Solid Italian Auction Results Soften Effects From S&P Spain Downgrade

(DE) Germany Sept Final Consumer Price Index M/M: 0.0% v 0.0%e; Y/Y: 2.0% v 2.0%e

(DE) Germany Sept Final CPI EU Harmonized M/M: 0.0% v 0.0%e; Y/Y: 2.1% v 2.1%e

(SE) Sweden Sept PES Unemployment Rate: 4.7% v 4.7%e

(ID) Indonesia Central Bank left its Reference Rate unchanged at 5.75%, as expected

(FR) France Sept Consumer Price Index M/M: -0.3% v -0.1%e; Y/Y: 1.9% v 2.2%e; CPI Ex Tobacco Index: 124.74 v 125.00e

(FR) France Sept CPI EU Harmonized M/M: -0.3% v 0.0%e; Y/Y: 2.2% v 2.4%e

(ES) Spain Sept Consumer Price Index M/M: 1.0% v 1.1%e; Y/Y: 3.4% v 3.5%e

(ES) Spain Sept CPI EU Harmonized M/M: 1.9% v 2.0%e; Y/Y: 3.5% v 3.5%e

(ES) Spain Sept CPI Core M/M: 0.9% v 1.1%e; Y/Y: 2.1% v 1.7%e

(HU) Hungary Sept Consumer Prices M/M: 0.4% v 0.2%e; Y/Y: 6.6% v 6.3%e

(TR) Turkey Aug Current Account: -$1.2B v -$1.6Be

(IN) India Preliminary Sept Trade Balance: -$18.1B vs. -$15.7B prior

(EU) ECB: €748M borrowed in overnight loan facility v €419M prior; €242.9B parked in deposit facility vs. €284.4 prior

(SE) Sweden Sept Average House Prices (SEK): 2.111M v 2.049M prior

(SE) Sweden Sept CPI Headline Rate M/M: 0.4% v 0.6%e; Y/Y: 0.4% v 0.6%e; CPI Level: 314.81 v 315.44e

(SE) Sweden Sept CPI Underlying (CPIF) M/M: 0.7% v 0.7%e; Y/Y: 0.9% v 0.9%e

(ES) Spain Banks Sept Net ECB Borrowings: €378.2B v €388.7B m/m (first decline since Sept 2011)

(PT) Portugal Sept Consumer Price Index M/M: +0.6% v -0.1% prior; Y/Y: 2.9% v 3.1% prior

(PT) Portugal Sept CPI EU Harmonized M/M: +0.4% v -0.1% prior; Y/Y: 2.9% v 3.2% prior

(GR) Greece July Unemployment Rate: 25.1% v 24.8% prior

(ZA) South Africa Aug Gold Production Y/Y: +0.4% v -5.0% prior; Mining Production Y/Y: 0.8% v 6.7% prior

Fixed Income
(IT) Italy Debt Agency (Tesoro) sold total €6.0B vs.€4.25-6.00B indicated range in 2015, 2016, 2018 and 2025 BTP bonds

Sells €3.75B vs. €3.75B indicated in 4.5% July 2015 BTP bond; Avg Yield 2.86% v 2.75% prior (highest yield since mid-July); Bid-to-cover: 1.67x v 1.49x prior

Sells €846M in 4.75% 2016 BTP bonds; Avg Yield 3.42% v 6.14% prior; Bid-to-cover: 2.22x v 1.42x prior

Sells €711M in 5.0% 2018 BTP bonds; Avg Yield 4.06% v 5.75% prior; Bid-to-cover: 2.46x v 1.61x prior

Sells €693M in 5.00% 2025 BTP bond; Avg Yield 5.25% v 5.90% prior; Bid-to-cover: 2.04x v 1.93x prior

(SE) Sweden sold SEK500M in 0.25% I/L 2022 bonds; Yield: -0.0953%

(HU) Hungary Debt Agency (AKK) sold HUF65B vs. HUF45B indicated in 12-Month Bills; Avg Yield 6.30% v 6.53% prior; Bid-to-cover: 2.93x v 2.05x prior

(UK) DMO sold £1.5B in new 0.125% I/L 2024 Gilts; Real Yield -0.441%; Bid-to-cover: 2.56x

Notes/Observations
S&P cuts Spain's Sovereign Rating to lowest level of investment grade (joining Moody's in that opinion)

Brazil Central Bank cuts interest rates for the 10th straight time in current easing cycle to fresh record low level of 7.25%

South Korea Central Bank cuts 7-Day Repo Rate by 25bps to 2.75% (as expected)

Australia data mixed with Monthly Net Change in Employment beating expectations while the Unemployment Rate ticked to a 2-year high of 5.4%

BoE's Weale: UK could have a "triple-dip" recession; Sees risks attached to additional rate cuts.

Italy main auction run of 2015 bonds seemed to please the markets and helped to eased peripheral yields

Equities
Indices: FTSE 100 +0.40% at 5,798, DAX +0.70% at 7,254, CAC-40 +0.40% at 3,379, IBEX-35 -0.30% at 7,643, FTSE MIB -0.10% at 15,418, SMI +0.10% at 6,637, S&P 500 Futures +0.40% at 1,431

Following the lower open, European equity indices are currently trading mixed. Spain's IBEX-35 has underperformed , after S&P lowered Spain's sovereign rating by two notches to the lowest level of investment grade (BBB-). In the banking sector, Spanish and Italian banks have lagged. Outperformers in the banking sector include Barclays, Credit Agricole, Deutsche Bank and RBS. Mining shares are broadly higher, tracking the gains in the commodity prices. Coming into Thursday's session, European bourses closed lower for the prior 3 sessions.

Large French retailer Carrefour [CA.FR] has gained over 4%, as the firm's Q3 sales exceeded analyst expectations. In London, Burberry's [BRBY.UK] shares are higher by over 6%, despite the company reporting weaker than expected Q2 sales. Recall in early Sept, Burberry's shares declined by over 15%, after the company warned on the Q2 figures. BAE Systems [BA.UK] has gained over 1%, following the release of its trading update.

Shares of Bumi PLC [BUMI.UK] are higher by over 25%, as the firm received a proposal from Bakrie Group, which aims to end the relationship between the two companies. Over the past few weeks, BUMI had been weighed down by a probe related to Indonesia's PT Bumi Resources. Sandwich retailer Greggs [GRG.UK] has lost over 3%, following the release of its Q3 trading update. Bookseller WH Smith [SMWH.UK] is lower by more than 2.5%, as the firm reported its FY results and announced its CEO transition plan

FTSE 100 movers (Burberry +8%, Croda +3.6%, British Land +2.1%, Petrofac +2%, Kazakhmys +1.8%; WM Morrison -1.4%)

CAC-40 movers (Carrefour +4.5%, LVMH +2.6%, Solvay +1.5%, Accor +1.4%, Unibail +1%; EADS -1.6%, STMicroelectronics -1.3%, Legrand -1.2%, Safran -1.2%)

DAX movers (Adidas +2.2%, Lanxess +1.6%, ThyssenKrupp +1.2%, Deutsche Bank +1.2%, HeidelbergCement +1.1%; Siemens -1.1%)

IBEX-35 movers (Banco Popular -4.5%, Gamesa -3.3%, Sacyr -3%, Banco de Sabadell -3%, Bankia -2.9%; Red Electrica +1.6%)

FTSE MIB movers (Banca Monte dei Paschi -2.8%; Impreglio -1.7%, Banco Popolare -1.1%, Parmalat -1.3%, Saipem -1.2%; Autogril +1.2%)

SMI movers (Richemont +3%, Swatch +1.8%, Credit Suisse +1.7%, Julius Baer +1.2%)