Investors who were unnerved by Fed's minutes and disappointing retail sales felt a bit relieved by news from the other side of the Atlantic. Spain succeeded in raising 3B euro from issuance of 15-year bonds at a rate of 5.116%, compared with 4.434% at a sale of the same securities on April 22. The bid-to-cover ratio was 2.57, indicating higher demand than April's auction (1.79). The euro strengthened and boosted commodity prices. The front-month contract for WTI crude rebounded after falling as low as 76.5. Yet price has been trading within a narrow range today. Gold climbs but remains below 1220.

OPEC released for the first time its demand forecast for 2011. The cartel responsible for 40% of the world oil output projects world oil demand will increase +1.17% y/y to 86.4M bpd in 2011. Estimates for 2009 and 2010 remained unchanged. On the supply side, non-OPEC supply is expected to grow by 0.3M bpd from 2010 with Brazil, Canada, Azerbaijan, Colombia, and Kazakhstan being the major contributors. OPEC NGLs and non-conventional oils are projected to reach 5.4M bpd in 2011, indicating a significant increase of around 0.5M bpd over 2010. Rise in non-OPEC production, OPEC NGLs and non-conventional oils made the call for OPEC largely unchanged despite increase in demand.

OPEC's data also unveiled further decline in compliance. The 11 members subject to production quotas produced 26.86M bpd in June, compared with a limit of 24.85 M bpd set in late 2008. Compliance level dropped to 52.1% from 53.6% in May.

Recovery in European bourses also helps oil prices which were under pressure and Asian stocks tumbled. The MSCI Asia Pacific Index slipped -0.9% while China's Shanghai Composite Index and Hong Kong's Hang Seng Index declined -1.87% and -1.48% respectively. Data showing moderation of Chinese growth in the second quarter and completion of Agricultural Bank of China's IPO were key factors.

Stock markets opened lower in European morning but the benchmark indices climb higher after strong Spanish bond auction. UK's FTSE changes little while, Germany's DAX and France's CAC 40 edges +0.3% and +0.4%, respectively.

US stock futures also surge a JP Morgan's earnings exceeded market expectations. Net profits jumped +76% y/y to $4.8B in 2Q10 as credit costs were lower. The strong results lifted optimism on other financial institutions including Citigroup, Goldman Sachs and Bank of America.

The US government will release a series of data including PPI, jobless claims, industrial production and manufacturing indices. PPI probably contracted -0.1% m/m in June after decline -0.3% in May while industrial production is expected to stay flat in June after expanding +1.2% a month ago. Regarding manufacturing surveys, Empire State index probably slid to 18.25 in July from 19.57 in the prior month while the Philly Fed index might have improved to 10 in July from 8 in June.