The EBA publishes the results of its stress tests

European shares found no clear direction as the BoJ eased monetary policy in less aggressive way than expected. European indices show modest gains with Spain and Italy outperforming. US equity indices opened little changed.

The US economy expanded at a significantly weaker pace than expected in the second quarter, adding to concerns that weakness in the global economy and trouble in the oil patch may have taken a greater toll than earlier forecast. The world's biggest economy expanded at an annualised pace of 1.2% in the three months to the end of June, from a downwardly revised 0.8% in the first quarter.

Growth in the eurozone fell to 0.3% in the three months to the end of June, falling back from an impressive 0.6% posted at the start of the year. Separate data showed inflation unexpectedly accelerated to 0.2% Y/Y in July, the strongest since January. Core inflation stabilized at 0.9% Y/Y. The euro zone unemployment rate held steady at a 5‐yr low of 10.1% in June.

The UK has become the temporary centre of the global oil glut as a lull in demand from refineries has led traders to store crude on ships off the coast. Brent crude reached a new short term low today, below $42/barrel.

After the close of the European markets, the EBA publishes the results of its stress tests. Monte dei Paschi di Siena is widely expected to emerge as the weakest lender. The board of Italy's oldest and most troubled lender threw its weight behind a risky privately funded rescue plan as it seeks to stave off a "bail‐in" under new European bank rules.