- Spain sees strong demand at debt auction- German ZEW surprises to the upside- Barclays leads banks higher after BofA noteGains for London's blue chip index had been extended by Tuesday lunchtime after some positive newsflow from Europe and a rebound in the banking sector.Spain issued €3.18bn in short-term government bonds this morning and while yields rose as expected, the issuance was higher than the €2-3bn target range and demand for both 12- and 18-month notes was strong. The borrowing rate for Spanish bonds jumped yesterday after Prime Minister Mariano Rajoy reiterated the gravity of his country's position saying the "fundamental objective at the moment is to reduce the deficit...If we don't achieve this, the rest won't matter: we won't be able to fund our debt." After having surged past the 6% level yesterday, the yield on 10-year Spanish bonds dropped 14.7 basis points to 5.923% just before midday today.Elsewhere in the Eurozone, despite consensus expectations of a fall in the ZEW German economic sentiment index to 19, the survey improved to 23.4 in April from 22.3 the month before. "The financial market experts who take part in the survey remain rather optimistic about the German economy. This appears to support the view that the latest financial market weakness, also visible in the German stock market, is most likely reflecting a technical correction and some renewed market worries about euro area sovereign debt rather than weaker fundamentals of the German economy," said analyst Thomas Harjes from Barclays Capital.Markets are also awaiting housing starts and industrial output data due out later today in the US. FTSE 100: Banks offset large falls for Burberry and M&SFinancials were performing strongly after yesterday's sell-off. Barclays, Schroders, RBS, Standard Chartered, Lloyds and Aviva were among the highest risers of the day. Barclays was leading the charge after Bank of America Merrill Lynch suggested the broking community could be about to up their earnings forecast for the bank. "With Eurozone fears hitting the shares recently, we think the first-quarter results could re-focus investors to the fundamental attractions," the US broker reckons.Leading the downside was luxury brand Burberry after underlying revenue growth eased in the fourth quarter owing to a slowdown in growth at its Wholesale division, affected "by the planned shift from wholesale to retail in Saudi Arabia and Spain and further rationalisation of the brand's distribution in the United States and Europe," the company said. Inventory problems at Marks and Spencer have hit sales in general merchandise (like clothing and homeware) but the tills are still ringing in the company's food halls. Like-for-like (LFL) sales in the UK were down 0.7% on the first quarter of 2011. Shares fell around 3%.Mobile phone networks giant Vodafone has cranked up its dispute with the Indian government by serving notice that it is prepared to go to international arbitration over India's plans to introduce a retrospective tax law which will hit the UK-based company hard. Shares were up over 1%.Miners were putting in a mixed performance. Diversified mining titan ENRC rose after announcing the completion of the acquisition of thermal coal group Shubarkol Komir JSC, which is expected to enhance the company's position as a leading coal producer in Kazakhstan. Anglo American was also among the best performers of the day.However Rio Tinto was flat after saying that production of copper and iron ore fell in the first quarter of 2012 compared with the final three months of last year. Sector peers Randgold Resources and Fresnillo however were heavy fallers on the Footsie.FTSE 250: Afren jumps on 'potentially transformational' oil discovery Afren thinks it might have struck it big in the Kurdistan region of Iraq with its Simrit-2 exploration well. "The scale of the oil column that has been intersected suggests that the Simrit structure and surrounding prospects elsewhere on the Ain Sifni PSC have the potential to be transformational for Afren", said Osman Shahenshah, Chief Executive. Daily Mail and General Trust (DMGT) said that advertising at Associated Newspapers, which publishes the Daily Mail, has fallen 3% in the six months to the end of March. Milk, cheese and spreads group Dairy Crest fell after saying it is looking to close two of its dairies. It also revealed that a Tesco contract will not be renewed.FTSE 100 - RisersBarclays (BARC) 220.40p +4.55%Amec (AMEC) 1,106.00p +3.27%Royal Bank of Scotland Group (RBS) 24.96p +2.84%Anglo American (AAL) 2,283.00p +2.49%Schroders (SDR) 1,477.00p +2.43%Standard Chartered (STAN) 1,535.50p +2.43%Vedanta Resources (VED) 1,190.00p +2.41%ITV (ITV) 86.80p +2.36%Aviva (AV.) 305.10p +2.28%Kazakhmys (KAZ) 893.50p +2.23%FTSE 100 - FallersBurberry Group (BRBY) 1,507.00p -4.98%Marks & Spencer Group (MKS) 357.50p -2.77%Randgold Resources Ltd. (RRS) 5,440.00p -1.98%Fresnillo (FRES) 1,538.00p -1.41%Sage Group (SGE) 282.50p -1.36%ARM Holdings (ARM) 592.00p -1.17%G4S (GFS) 285.50p -0.83%Imperial Tobacco Group (IMT) 2,459.00p -0.77%Ashmore Group (ASHM) 385.70p -0.52%Experian (EXPN) 970.00p -0.51%FTSE 250 - RisersAfren (AFR) 142.40p +5.87%Exillon Energy (EXI) 130.20p +5.00%Dixons Retail (DXNS) 17.50p +4.79%Stagecoach Group (SGC) 250.00p +3.95%Heritage Oil (HOIL) 141.50p +3.89%Spirit Pub Company (SPRT) 56.25p +3.69%Logica (LOG) 81.40p +3.56%Ocado Group (OCDO) 111.00p +3.35%Capital & Counties Properties (CAPC) 197.30p +3.30%Grainger (GRI) 106.60p +3.09%FTSE 250 - FallersDaily Mail and General Trust (DMGT) 419.30p -5.69%Morgan Crucible Co (MGCR) 322.40p -3.44%Spirent Communications (SPT) 163.60p -2.09%EnQuest (ENQ) 121.40p -1.78%CSR (CSR) 208.40p -1.51%Phoenix Group Holdings (DI) (PHNX) 524.50p -1.41%Perform Group (PER) 296.00p -1.33%Savills (SVS) 350.90p -1.13%Senior (SNR) 198.10p -1.10%Synergy Health (SYR) 835.50p -1.01%BC
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