Participation is light ahead of Easter holiday

EU Market Update: Heavy weights in Europe report mixed results ahead of Easter holiday; Putin postures ahead of meeting on Ukraine

Notes/Observations

- Participation is light ahead of Easter holiday

- Japan Govt (Cabinet Office) cuts its overall economic assessment of economy (first downgrade since Nov 2012) citing impact from the sales tax increase

- Ahead of quad discussion on Ukraine, Russia President Putin says he is sure that Russia would reach an agreement with Ukraine; both countries are tied by joint interest

- Euro remains unfazed by verbal intervention

- (FR) France Fin Min Sapin: Reiterates strong Euro bad for companies and growth - radio interview

- Mulberry Group lowered its outlook for the first time in 3-yrs; will offer cheaper products to try and jump start sales

- Taiwan Semiconductor Manufacturing, handily beat estimates and y/y figures in Q1 results, gross margin was higher than expected, while Op margin rose q/q.

- Diageo reported Q3 organic net sales -1.3% v +1.8%e, volume -1% y/y, shouldered the blame on weak economies and negative fx impact

- SAP reported a strong Q1, slightly missing on Rev, though given a strong boost from cloud business.

- (CN) China PBoC may relax controls on foreign central banks in their domestic bond market - financial press

Equities

- Market Focal Points: Equity markets open mixed following negative leads from Asia and various European corporate earnings report, US technology companies disappoint (IBM, Google), Like in Q4 European corporates continue to be negatively impacted by forex factors (SAP, Akzo Nobel), Weakness in Asia/Pacific weigh on Diageo and Remy Cointreau, US corporate earnings pick up on today's session (include GE, Goldman, Dupont, Pepsi, Morgan Stanley, Honeywell, Philip Morris)

- Indices [Stoxx50 -0.3%, FTSE 100 -0.2% at 6,571, DAX flat at 9,315, CAC-40 +0.1% at 4,409, IBEX-35 -0.4% at 10,228, FTSE MIB -0.3% at 21,465, SMI -0.1% at 8,311, S&P 500 Futures -0.2% at 1,849]

By Sector

- Industrials [Imtech IM.NL +8% (asset sale), TUI AG TUI1.DE +3% (merger between Hapag-Lloyd and CSAV)]

- Consumer Discretionary [Publicis PUB.FR +2.5% (Q1 organic growth 3.3%); Mulberry MUL.UK -6% (another profit warning), Remy Cointreau RCO.FR -5% (cautious outlook), Diageo DGE.UK -4% (Q3 sales -1.3%)]

- Technology [SAP SAP.DE -2.5% (Q1 results below ests)]

- Basic Materials/Resources [Akzo Nobel AKZA.NL -4.5% (Q1 results below ests)]

- Healthcare [Galapagos GLPG.BE +3% (data presentation), Actelion ATLN.CH +1% (Q1 results above ests)]

- Utilities [RWE RWE.DE -5% (ex-dividend)]

- Stoxx50 sectors [Telecom flat, Financials flat, Industrials flat, Basic Materials flat; Utilities -2%, Technology -1.6%, Consumer Non-Cyclical -0.7%, Consumer Cyclical -0.2%, Energy -0.1%]

Currencies/Fixed Income

- Verbal intervention from European officials having little effect in downward price action in the pair. French officials were out in force the past 24 hours. The USD remained on the defensive after dovish commentary from Fed Chair Yellen

- BoJ governor, Kuroda, continues to suggest that further policy action is not on the cards at this point

Economic Data

- (JP) Japan Mar Consumer Confidence Index: 37.5 v 37.7e

- (JP) Japan Mar Nationwide Dept Sales Y/Y: 25.4% v 3.0% prior; Tokyo Dept Store Sales Y/Y: 25.5% v 3.9% prior

- (UK) Retailer John Lewis reports weekly LFL Partnership sales for week ending April 12th (y/y): +9.5% v +15.7% prior

- (DE) Germany Mar PPI M/M: -0.3% v 0.0%e; Y/Y: -0.9% v -0.7%e

- (EU) EU27 Mar New Car Registrations: 10.6% v 8.0% prior

- (IL) Israel Apr CPI Forecast: 1.5% v 1.6% prior

- (IL) Israel Mar M1 Money Supply Y/Y: 16.1% v 16.6% prior

- (EU) ECB €0.0M borrowed in overnight loan facility vs. €0.0M prior; €29.1B parked in deposit facility vs. €24.9B prior - Daily Eurosystem Liquidity Conditions

- (NL) Netherlands Mar Unemployment Rate: 8.7% v 8.8%e

Looking Ahead

All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)

- (UR) EU, US, Ukraine and Russia hold talks in Geneva on Ukraine

- (GR) Greece Feb Current Account Balance: -€200Me v -€295M prior

- 05:50 (FR) France Debt Agency (AFT) to sell combined €1.50B in I/L Oati (inflation-linked)

- Sells € in 0.25% 2018 Oati; Avg Yield % v -0.20% prior; Bid-to-cover: (Feb 20th)

- Sells € in 2.1% I/L July 2023 Oati; Yield % v 0.60% prior (Oct 17th 2013)

- Sells € in 0.25% 2024 Oati; Avg Yield % v 0.72% prior; Bid-to-cover: (Feb 20th 2014)

- 06:00 (PT) Portugal Mar PPI M/M: No est v 0.0% prior; Y/Y: No est v -1.5% prior

- 06:00 (EU) ECB announces weekly 3-Year LTRO Repayment vs. €6.0Be

- 06:00 (CZ) Czech Republic to sell 9-month Bills

- 06:00 (UK) DMO to sell combined £2.0B in 1-month, 3-month and 6-month Bills

- 06:30 (EU) ESM to sell 6-month Bills

- 06:45 (US) Daily Libor Fixing

- 07:00 (RU) Russia Gold and Forex Reserve w/e Apr 11th: No est v $473.9B prior

- 08:00 (PL) Poland Mar Sold Industrial Output M/M: +10.1%e v -1.8% prior; Y/Y: 6.4%e v 5.3% prior

- 08:00 (PL) Poland Mar PPI M/M: -0.1%e v -0.1% prior; Y/Y: -1.2%e v -1.4% prior

- 08:00 (RU) Russia Mar Unemployment Rate: 5.7%e v 5.6% prior

- 08:00 (RU) Russia Mar Real Retail Sales M/M: 8.0%e v -0.1% prior; Y/Y: 3.3%e v 4.1% prior

- 08:00 (RU) Russia Mar Investment in Productive Capacity: -3.0%e v -3.5% prior

- 08:00 (RU) Russia Mar Real Disposable Income: 0.0%e v 1.0% prior

- 08:00 (RU) Russia Mar Real Wages Y/Y: 3.6%e v 6.0% prior

- 08:00 (PL) Poland Central bank (NBP) April Minutes

- 08:00 (BR) Brazil Apr IBGE Inflation IPCA-15 M/M: 0.9%e v 0.7% prior; Y/Y: 6.3%e v 5.9% prior

- 08:00 (BR) Brazil Mar Unemployment Rate: 5.4%e v 5.1% prior

- 08:15 Baltic Dry Bulk Index

- 08:30 (US) Initial Jobless Claims 315Ke v 300K prior; Continuing Claims: 2.78Me v 2.776M prior

- 08:30 (CA) Canada Mar CPI M/M: 0.4%e v 0.8% prior; Y/Y: 1.4%e v 1.1% prior; Consumer Price Index: No est v 124.1 prior

- 08:30 (CA) Canada Mar CPI Core M/M: 0.3%e v 0.7% prior; Y/Y: 1.3%e v 1.2% prior

- 08:30 (CA) Canada Mar CPI (Seasonally Adj) M/M: No est v 0.3% prior; Y/Y: CPI Core (Seasonally Adj) M/M: No est v 0.2% prior

- 08:30 (US) Weekly USDA Net Export Sales

- 09:00 (BE) Belgium Apr Consumer Confidence Index: No est v -8 prior

- 09:30 (EU) ECB calls for bids in 7-Day Main Refinancing Tender at fixed 0.25%

- 09:30 (EU) ECB announces amount to be sterilized in next 7-day Term Deposit tender

- 10:00 (US) Apr Philadelphia Fed Business Outlook: 10.0e v 9.0e

- 10:00 (LX) ECB's Mersch (Luxembourg)

- 10:30 (US) Weekly EIA Natural Gas Inventories

- 13:00 (US) Treasury to sell $18B in 5-Year TIPS