-Germany says more time for Greece is only speculation -Authorities may be rethinking mechanics of Spanish rescue -WSJ -PIMCO (Bosomworth) says ECB must restart bond buying -LCH raises margin requirements for Spanish debt -Spanish and Italian bond yields drop FTSE-100: 0.43% Dax-30: 0.20% Cac-40: -0.21% Euro Stoxx 50: 0.18% FTSE-Mibtel: 1.40% Ibex 35: 0.58% The major European equity benchmarks are now registering slight advances, with the exception of the periphery markets where the gains are currently significantly greater. This on the back of a certain improvement in the news-flow regarding Europe and the periphery, and against the backdrop of tonight´s Federal Reserve meeting. Most economists seem to expect that the US central bank will indeed extend its so-called ‘operation Twist.’ Back in Europe, for the most part commentators seem to be reacting favourably to yesterday´s outcome of the G-20 summit in Mexico. For one, the G-20 backed Europeans´ ‘intention to consider concrete steps towards a more integrated financial architecture, encompassing banking supervision, resolution and recapitalization, and deposit insurance.’ Furthermore, Europe committed itself to looking at how to break the ‘vicious circle’ between bank and sovereign debt markets. The situation, however, continues to be critical, particularly as regards Spain and Greece. For that reason some well-known fund managers continue to insist that the European Central Bank will be forced to return to bond purchases on the open market. Good news for a change today on the Spanish front. According to The Wall Street Journal European leaders are reconsidering the ‘mechanics’ of the Spanish rescue given the very negative reaction to the first announcement. As well, the Spanish Economics Ministry has denied reports that it will delay the results of one of its audits of the Spanish financial system to September. Also worth noting, the Dutch press holds that European finance ministers will this Friday water-down a proposed financial transaction tax. H&M results beat consensus Ryan Air has revived its bid for smaller rival Aer Lingus, in a transaction which values the latter at EUR694m. H&M is also on the rise today after reporting a 23% increase in second quarter profit to 5.22bn kronor, well ahead of analysts´ estimates. Large drop in Swiss economic sentiment The ZEW institute´s Swiss economic confidence index fell to -43 points in June, from -4. Italian industrial orders fell by 1.5% month-on-month in April (Consensus: -2.0%). Oil holds lower Front month Brent crude futures are off by 0.462 dollars, at 95.33 on the ICE. The euro/dollar cross is now up by 0.11% to the 1.2701 dollar mark.

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