Asian markets mixed with Japan closed today, China’s Shanghai composite 1.3% lower on concerns their slowdown is deepening. On geopolitical news, tensions between Japan and China continue to rise over the purchase by Japan of islands from a private Japanese owner. A top think tank has called for 2012 Chinese growth of between 7.7and 7.8%.

In Europe, Spain has held informal talks with the EU on possible aid request, sounding out the EU on policy conditions before submitting a request. European equity futures are pointing to a fall of around 40bps, whilst the Euro remains firm at 1.3135.

In the US, Egan Jones have cut their US credit rating to AA- from AA, later today we have Empire manufacturing data, US futures are around 20bps lower with the US 10 year treasury yield slightly higher at 1.89%.

Philip Ball | Sales and Trading