European Concerns Continue To Sizzle And Aid Risk Aversion Sentiment

(DK) Denmark July Consumer Confidence: +0.1 v -3.0e

(ES) Spain May Mortgages-capital loaned Y/Y: -32.4% v -26.4% prior; Mortgages on Houses Y/Y: -30.5% v -31.3% prior

(CH) Swiss June M3 Money Supply Y/Y: 7.4 v 6.3% prior

(TW) June Industrial Production Y/Y: -.24% v +0.5%e; Commercial Sales Y/Y: -0.9% v +0.7%e

(HK) Hong Kong June CPI Composite: 3.7% v 4.0%e

Fixed Income
(PH) Philippines sold total PHP7.5B vs. PHP7.5B indicated in 3-month, 6-month and 12-month Bills

(DE) Germany sold €2.703B in 12-Month BuBills; Average Yield -0.0540% v +0.0191 prior; Bid-to-cover: 2.3x v 2.8x prior

Notes/Observations
Risk aversion remains heightened on global growth and European periphery concerns.

Numerous more Spanish regions said to be seeking central government assistance.

Spain borrowing cost hits record high while safe haven flows sends US, UK, Finland, Swiss, German, Norwegian and Singapore yields to record low levels.

IMF considering ending its support to Greece.

Equities
FTSE 100 -1.7% at 5556, DAX -1.6% at 6527, CAC-40 -1.9% at 3132, IBEX-35 -4.1% at 5988, FTSE MIB -4% at 12,542, S&P 500 Futures -1.1% at 1344

European equity indices opened the session lower and have continued to weaken on renewed concerns related to Greece and the Spanish regions. The IBEX-35 has lost over 4% on the session, as the index hit multi-year lows (below 6,000). The weakness in the IBEX-35 has come as Spain's 2, 5, 10 and 30 year yields have all hit record highs, with the 5-year yield moving above 7%. In Greece, concerns about the country's EU/IMF bailout agreement have driven the Athens Stock Exchange (ASE) lower by over 4.3%.

Amid the overall negative tone for the banking sector, financial companies which have underperformed include Intesa [ISP.IT], Unicredit [UCG.IT], KBC [KBC.BE] and BBVA [BBVA.ES]. Large resource related companies are trading lower, tracking the decline in commodity prices (COMEX Copper -2.8%, NYMEX Crude Futures -3%). In terms of corporate earnings, companies seen reporting during the US morning include Hasbro, Haliburton and McDonald's.

In the Netherlands, Philips [PHIA.NL] has gained over 7%, as the company reported better than expected quarterly results, while property company Wereldhave [WHA.NL] is lower by over 10%, after issuing a profit warning. Swiss bank Julius Baer [BAER.CH] has gained over 1%, as the firm reported better than expected net new money inflows for H1. In France, Peugeot [UG.FR] has moved slightly higher after disclosing a commercial vehicle partnership in Europe with Toyota.

Among the individual movers in the UK, Aquarius Platinum [AQP.UK] is lower by over 4% (reported H1 results), while African Barrick Gold [ABG.UK] has lost ~3.5% (issued Q4 production update). UK staffing firms are trading lower amid reports that UK tax officials are planning to probe whether certain recruitment firms engaged in tax avoidance schemes.