LONDON (ShareCast) - -ST Microelectronics sees Q1 revenue drop of 10%.

-Siemens reports fall in first quarter profit.

-Eurozone Finance Ministers press IIF for a lower coupon.

-Texas Instruments rose 3.5% after the US close, following results.

-German PMI surveys stronger than expected.

-Mixed French PMI data.

FTSE-100: -0.80%%
Dax-30: -1.04%
Mibtel-30: 0.41%
Ibex 35: -0.60%
Cac-40: -0.91%

The main European equity benchmarks have begun the trading session lower, weighed down by news that Eurozone finance ministers did not accept the offer made by Greece’s private sector creditors on the coupon rate to be assigned to the country’s new debt, should a voluntary debt exchange finally be agreed.

Eurozone finance ministers could not be coerced to sign off on the proposal for Greek debt and responded with a resounding “no”. The bone of contention lies in the fact that the IIF insists on an average 4% interest rate for the life of the new debt, while Greece refuses to pay above 3.5%.

The Eurogroup members that met yesterday in Brussels decided to back Athens. Its president, Jean-Claude Juncker, agreed that the Greek coupons need to be below 3.5% for the debt to be paid up to 2020 and that it should be below 4% for the full 30 year life of the bonds.

Also weighing on equities, weak results out from the likes of Dutch telecommunications group KPN and german industrial conglomerate Siemens this morning.

Furthermore, Deutsche Bank is now giving back some ground on the back of a broker downgrade.

Also weighing on banks possibly, Societe Generale and Credit Agricole are among French banks to have had their credit grades cut by ratings agency Standard & Poor’s.

The International Monetary Fund (IMF) is expected to publish its World Economic Outlook (WEO) this afternoon.

Spain’s Treasury will auction up €2.5bn in 3 and 6 month bills later this morning.

MACROECONOMY

The German manufacturing sector purchasing managers’ index for the month of January has surprised to the upside, at 50.9 (Consensus: 49.2), versus 48.4 in December.

The German service sector purchasing managers’ index for the month of January has surprised to the upside, at 54.5 (Consensus: 52.6), versus 52.4 in December.

OTHER MARKETS

The Euro/dollar is now rising by 0.13% to the 1.3030 dollar level.

Brent crude futures are higher now by 0.289% to the $110.90 per barrel mark.

AB

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