Numerous European Data Releases And Bond Auction Bode Well For Risk Sentiment: April 17, 2012

(IN) India Central Bank (RBI) cut the Repo Rate by 50bps to 8.00% (More than the 25bps expected); the Cash Reserve Ratio (CRR) unchanged at 4.75%

(SE) Sweden Mar PES Unemployment Rate: 4.5% v 4.5%e

(EU) Mar EU 25 New Car Registrations: -7.0% v -9.7% prior

(AT) Austria Mar Consumer Price Index: M/M: 1.1 v 0.5% prior; Y/Y: 2.4 v 2.6% prior

(UK) Feb DCLG UK House Prices Y/Y: 0.3 v 0.0% prior

(UK) Mar CPI M/M: 0.3% v 0.3%e; Y/Y: 3.5% v 3.4%e; Core CPI Y/Y: 2.5% v 2.3%e

(UK) Mar RPI M/M: 0.4% v 0.4%e; Y/Y: % v 3.6%e; RPI Ex Mortgage Interest Payments Y/Y: 3.7% v 3.7%e; Retail Price Index: 240.8 v 240.9e

(EU) Eurozone Mar CPI M/M: 1.3% v 1.2%e; Y/Y: 2.7% v 2.6%e; Core CPI Y/Y: 1.6% v 1.5%e

(DE) Germany Apr ZEW Economy Sentiment: 23.4 v 19.0e; Current Situation: 40.7 v 35.0e

(EU) Euro Zone Apr ZEW Economic Sentiment: 13.1 v 11.0 prior

(IT) Italy Feb Current Account: -€5.1B v -€8.0B prior

Fixed Income

(ES) Spain Debt Agency (Tesoro) sold approx €3.2B vs. €2.0-3.0B indicated range in 12-Month and 18-Month Bills

Sold €2.09B in 12-month Bills; Avg Yield 2.623% v 1.418% prior; Bid-to-cover: 2.90xv 2.1x; Max Yield 2.738% v 1.473% prior

Sold €1.09B in 18-month Bills; Avg Yield 3.110% v 1.711% prior; Bid-to-cover: 3.77x v 2.9x; Max Yield 3.200% v 1.770% prior

(GR) Greece Debt Agency (PDMA) sold €1.625B vs.€1.25B indicated in 13-week Bills; avg yield 4.20% v 4.25% prior; Bid-to-cover: 2.46x v 2.69x prior

(ZA) South Africa sold total ZAR2.1B vs. ZAR2.1B indicated in 2018, 2021 and 2031 bonds

(EU) ECB allotted €51.7B in Main 7-Day Refi Operation vs. €55Be

(HU) Hungary Debt Agency (AKK) sold total HUF40B vs. HUF50B indicated in 3-Month Bills; avg yield 7.28% v 7.26% prior (first rise in yields in 5 weeks); Bid-to-cover: 1.41x v 1.68x prior

(BE) Belgium Debt Agency sold total €3.25B vs. €3.5B indicated in 3-month and 12-month Bills

Sold €1.60B in 3-month Bills; Avg yield 0.229% v 0.188% % prior; Bid-to-cover: 3.10x v 2.56x prior

Sold €1.645 in 12-month Bills; Avg Yield 0.734% v 0.586% prior; Bid-to-cover: 2.32x v 2.58x prior

Notes/Observations

India cuts rates more than expected.

Argentina nationalizes Repsol (Spain) Argentine unit.

Spain bill auction result saw strong bid-to-cover coupled with higher yields; sold just above the indicative range.

IMF to update its global outlook later today.

Japan became the first non-European country to pledge extra money to IMF; Sweden pledges at least $10B.

German ZEW Survey continues to improve.

Key US corporate earnings include Coca Cola [KO], Johnson & Johnson [JNJ]; Goldman-Sachs [GS] and State Street Bank [STT].

Equities

FTSE 100 +0.90% at 5715, DAX +1.2% at 6703, CAC-40 +1.5% at 3,253, IBEX-35 +1.3% at 7,300, FTSE MIB +2.4% at 14,761, SMI +0.50% at 6156

European equity indices opened the session mostly lower, but indices have since more into positive territory, supported by the rebound in French banks and better than expected German ZEW data. Also, Spain's debt agency sold €3.2B in bills, which was higher than the €2-3B expected range. As for upcoming US corporate events, companies expected to report earnings during the US morning include Goldman-Sachs and J&J.

Shares of Burberry [BRBY.UK] have declined by over 4%, after the company reported weaker than expected H2 sales figures, while Marks & Spencer has lost over 2% on its quarterly sales report. Rio Tinto [RIO.UK] is declining by more than 0.50%, as the company reported that its Q1 iron ore production declined q/q.

In Germany, Sky Deutschland has gained over 20% on reports that the company won broadcasting rights for the German Football League. Banking machine manufacturer Wincor Nixdorf [WIN.DE] has declined by over 8%, announcing plans to downsize certain activities in Europe. France-listed Danone has gained over 1%, after reporting its Q1 sales. In Spain, Repsol [REP.ES] has declined by more than 7%, as the Argentina Government confirmed that it would nationalize the YPF unit.