-Investors waiting on German constitutional court
-Italy cancels mid-August debt auction due to good fiscal performance
-Greece tempers demands -Reuters
-Spain announces VAT increase and numerous other measures
-Spanish 10 year bond yields down by 16bp to 6.65%
-10,000 march against end of mining sector subsidies in Madrid

FTSE-100: -0.09%
Dax-30: 0.08%
Cac-40: -0.45%
FTSE-Mibtel: -0.31%
Ibex 35: 0.89%
Stoxx 600: 0.07%

European equity markets were still trading in a mixed but fairly steady fashion at the midday mark, despite the worry over possible further delays to the ratification of the European Stability Mechanism by Germany. That as profit warnings weighed on US stocks overnight, while Chinese Prime Minister Wen Jiabao reiterated the importance of buttressing levels of investment -and thus growth- in his country.

Significantly, however, the government in Madrid has unveiled the details of EUR65bn in spending cuts, as part of the measures which it agreed with Brussels that it would undertake in exchange for aid from the rest of the European Union. That as the country attempts to cut its ‘red ink’ to the equivalent of 6.2% of gross domestic product this year and to 3% in the medium term. That would make for a reduction of 2.6 percentage points just in 2012, in the midst of a recession which is the country´s second worst by the Prime Minister´s own admission. In particular, some observers warn of the effect which raising the main rate of value added tax may have. Even so, for now the first reaction by financial markets seems to be positive.

As regards Greece, the country´s finance minister, Yannis Stournaras, told Reuters Television that he wanted to get his country’s adjustment programme back on track before requesting any kind of extension to a 130 billion-euro bailout from the EU and IMF.

Acting as a backdrop, in the US profits for S&P 500 companies are thought to have fallen by 1.8% in the second quarter, according to analyst estimates compiled by Bloomberg. That would be the first decline since 2009. Analysts however project profit growth of 3.9% and 15%, respectively, in the third and fourth quarters of 2012.

Automobiles continue to lead declines

From a sector stand-point the worst performance on the DJ Stoxx 600 can now be seen in the following industrial groups: automobiles (-1.59%), personal goods (-1.47%) and construction (-1.15%).

GlaxoSmithKline and its partner Shionogi may benefit from positive clinical trial results for their experimental AIDS drug.

German inflation as expected

Germany´s consumer price index for the month of June has been confirmed at 1.7% year-on-year.

Single currency holding steady

Front month Brent crude futures are now rising by 0.84 dollars to the 98.8 dollar per barrel mark on the ICE.

The euro/dollar is edging up by 0.09% to 1.2260.

AB