In response to the tragic Barcelona.....>

EGB SUMMARY: In response to the tragic Barcelona attacks, there is an air of

caution hanging over the financial markets this morning. This Bund contract,

initially opened stronger but has surrendered some of these gains as trading

stabilises. 

- Peripheral markets are underperforming marginally as equities sink. The

Spanish IBEX index has lost 1.0%, and is the weakest bourse in Europe by a

significant margin on Friday.

- Overnight, Fed Presidents Kaplan and Kaskari's made their usual dovish

speeches and broke no fresh ground.

- The 2-Year German Schatz yield is 1.1bp lower today at -0.712%, a level that

is close to low yields from last week. 

- In derivatives markets, the Eurobuxl invoice spread remains close to a 4 month

high at 40.6bp.

- German PPI data for July came in slightly hot relative to expectations at

2.3%Y/Y but now the data calendar is devoid of market moving events until the

University of Michigan sentiment indicator.