-Supervisors ease implementation of global liquidity rules
-china sovereign weath fund goes shopping in Germany
-Epiphany feast day in Southern Europe
-No major economic releases expected
FTSE Mibtel 30: 0.53%
Ibex 35: 0.46%
Stoxx 600: -0.04%
The main European equity benchmarks have begun the day on a mixed footing. That ahead of this week's rate-setting meetings of the Bank of England and European Central Bank (ECB). Nevertheless, some market commentary holds that the ECB's will be a 'non-event' given recent signs of cyclical improvement. Those same analysts will be training their sights, instead, on the first Italian and Spanish sovereign bond auctions of the year, which are scheduled to take place later in the week. For their part, analysts at Unicredit highlight that both issues will embed so-called 'collective action clauses' (CACs).
Perhaps lessening the need for monetary authorities to act further, yesterday evening the Group of Governors and Heads of Supervision (GHOS) announced modifications to the global liquidity rules set to come into effect for the world's main lenders. The new agreement prolongs the implementation phase for the so-called liquidity coverage ratio (LCR) and expands the types of assets eligible.
Acting as a backdrop, over the weekend US Senate majority leader Mitch Mc.Connell indicated that Republicans are not willing to raise taxes any further. This initial stance may just be a part of the negotiation process expected to take place over the next month approximately. Also worth mentioning, as far as market 'technicals' are concerned are: European equityies are near 22 month highs, after rising by 20% Chinese equities have entered a 'bull market', levels of volatility have hit relative new lows in the US (the VIX fell below 14 last Friday).
Today is the feast day of the Epiphany in several Southern European nations, which may weigh on trading volumes in their respective bourses.
China goes shopping in Germany
Shares of Daimler are adding 1% following a report that sovereign wealth fund China Investment Corp. may buy a stake in the company. CIC may acquire up to a 10% stake.
Infineon Technologies has been downgraded to underperform, the equivalent of a sell recommendation, from neutral at Bank of America Corp.
From a sector stand-point the best performance on the DJ Stoxx 600 is now to be seen in shares
of Banks (2.09%), Insurance (0.52%) and Financial services (0.33%).
No major macroeconomic releases are slated for release today
Investors now net long the single currency
The euro/dollar is moving slightly lower at the moment, by 0.36% to the 1.3022 dollar
mark. The latest weekly IMM data showed euro positioning turn marginally net long for the first time since August 2011. For many that means that the risk of weakness in that currency unit is now proportionately higher.
Front month Brent crude futures are down by 0.415 dollars to the 110.85 dollar level on the ICE.