Investors Continue To Seek Safety Of AAA-Rated, Core European Countries

(JP) Japan June Final Machine Tool Orders: -15.5% v -15.5% prelim

(CZ) Czech June PPI Industrial M/M:-0.3% v -0.2%e; Y/Y: 1.5% v 1.7%e

(CZ) Czech May Export Price Index Y/Y: 4.0% v 2.7% prior; Import Price Index Y/Y: 6.1% v 4.5% prior

(ES) Spain Q2 House Price Index Q/Q: -2.6% v -3.0% prior; Y/Y: -8.3% v -7.2% prior

(ZA) South Africa Jun CPI (all items) M/M: 0.2% v 0.3%e; Y/Y: 5.5% v 5.6%e

(ES) Spain May Bad Loans at €155.8B v €152.7B prio

(UK) BOE voted 9 to 0 (unanimous) to leave interest rates unchanged at 0.50%

(UK) BOE voted 7 to 2 to increase Asset Purchase Target by £50B to £375B; MPC members Dale and Broadbent opposed increase

(UK) June Jobless Claims Change:+6.1K v +5.0Ke; Claimant Count Rate: 4.9% v 4.9%e

(UK) May Average Weekly Earnings 3M/Y: 1.5% v 1.4%e; Weekly Earnings exBonus 3M/Y: 1.8% v 1.9%e

(UK) May ILO Unemployment Rate: 8.1% v 8.2%e; Employment Change 3M/3M: 181K v 120Ke

(EU) Eurozone May Construction Output M/M: +0.1 v -3.7% prior; Y/Y: -8.4% v -6.3% prior

(CH) Swiss July Credit Suisse ZEW Expectations Survey: -42.5 v -43.4 prior

(IT) Italy May Current Account: -€1.2B v -€1.1B prior

(MA) Malaysia June CPI Y/Y: 1.6% v 1.7%e

(PT) Portugal June Producer Prices M/M: -0.7% v -0.5% prior; Y/Y: 2.7 v 3.2% prior

(ZA) South Africa Q2 BER Consumer Confidence: -3 v +5 prior

Fixed Income
(IN) India sold total INR120B vs. INR120B indicated in 3-month and 6-month Bills

(RU) Russia sold RUB14.5B vs. RUB15B indicated in 2027 OFZ Bonds; Yield 8.30% vs. guidance between 8.27-8.32%

(EU) ECB allotted $4.3B in 7-day USD liquidity tender at fixed 0.67% vs. $5.1B prior

(EU) ECB allotted $2.8B in 3-month USD liquidity tender at fixed 0.66% vs. $9.9B prior

(DE) Germany sold €4.17B in 0.0% Jun 2014 Schatz; Avg Yield -0.06% (record low) v +0.1% prior; Bid-to-cover: 2.0x v 1.9x prior

(PT)) Portugal Debt Agency (DSTA) sold total €2.0B vs. €1.75-2.00B indicated Range in 6-Month and 12-Month Bills

Sold €750M in 6-month Bills; Avg Yield 2.292% v 2.653% prior; Bid-to-cover: 3.82x v 4.3x prior

Sold €125M in 12-month Bills; Avg Yield 3.505% v 3.834% prior; Bid-to-cover: 2.4x v 2.7x prior

Notes/Observations
China Economic Work Conference China could shift monetary policy from "prudent" to "moderately loose" due to slowing economic growth.

Fed Chairman Bernanke to testify to House later today (likely to reiterates Tuesday comments to the Senate).

BOE vote to increase Asset Purchase Target earlier this month was not unanimous.

German Chancellor Merkel said to have commented that she could not be sure European project would work but remained optimistic.

Vague speculation that Austria could be faced with a sovereign cut.

Equities
FTSE 100 +0.30% at 5645, DAX +0.40% at 6600, CAC-40 +0.90% at 3205, IBEX-35 -0.10% at 6554, FTSE MIB flat at 13,541, SMI +0.50% at 6230, S&P 500 Futures -0.24% at 1355

Equity indices opened the session broadly higher, despite mixed trading in Asia and amid mixed corporate earnings. France's CAC-40 has led today's gains, while the Spanish IBEX-35 has underperformed. Banks have traded mixed (laggards have included Deutsche Bank, Santander, BBVA and Unicredit). Amid the ongoing global growth concerns, UK-listed commodity names are trading mixed. Looking ahead, companies seen report earnings during the US morning include Abbot Labs, Bank of America, Bank of New York, BlackRock and Honeywell. Following Tuesday's US close, large chipmaker Intel traded lower, as the company cut its 2012 sales forecast.

Credit Suisse [CSGN.CH] is gaining over 4%, after preannouncing better than expected quarterly results. Also, the Swiss bank disclosed a plan to bolster its capital levels by ~CHF15.3B. In Sweden, Ericsson [ERICB.SE] has declined by over 4%, as the company reported weaker than expected quarterly earnings and gross margins. Ericsson noted that part of the weakness in its results were due to sales in China and Russia. The London Stock Exchange [LSE.UK] has traded lower by over 1%, following the release of Q1 sales figures. Homeserve [HSV.UK] has benefitted from takeover speculation and has gained by over 5%.

In other UK movers, gold and silver miner Fresnillo [FRES.UK] is higher by ~3% on the company's Q2 production results. Puma [PUM.DE] has declined by over 4%, as the company warned on its H1 net profit and lowered its FY sales growth forecast. Coupled with the losses in shares of Puma, Adidas [ADS.DE] has also traded lower. In Norway, agricultural company Yara International [YAR.NO] has gained over 2%, as the company reported better than expected Q2 results. Dutch chip equipment firm ASML [ASML.NL], has moved between gains and losses, following the release of quarterly results and guidance.