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Zurich 26 July, 2010. Europe´s debt crisis appears to be reaching an end and bank stress tests have barely touched Eurozone sentiment, at least for now, according to the Media Tenor´s analysis of cited financial experts. Reporting on activity in Spanish sovereign bonds was able to restore a measure of trust to European bond markets despite continued coverage on downgrades, or potential downgrades, of various European countries. Reports on the broadband market in India helped raise Reliance Industries´ tonality, and the high volume suggests that RIL remains the Western media´s litmus test for business sentiment in India. Despite the recent gains that India´s economy had made, the country has failed to remain in the media spotlight as China has returned to occupy the BRIC media agenda.

The second half of July has brought praise for growth figures in both Germany and the UK. This appears to be signaling a turnaround in the Euro story. For the Euro itself, cited analysts have been slightly more positive in the third week of July, although the generally low rating shows that journalists are choosing to support a cautious mood. Media Tenor´s Director of Research, Matthias Vollbracht, sees the mood as symptomatic of the early phase of crisis resolution.“ This is a similar pattern to the end of the financial crisis”, says Vollbracht. “The media is reporting on the positives, but there is still a natural skepticism and this showing up in the analyst citations.”

While the Euro has risen in tonality, there has been a somewhat surprising downturn in cited analyst sentiment around the BRIC economies. The potential India had shown in June has all but evaporated, and analysts have swung quite quickly from praise to concern that any BRIC downturn might hamper western recovery. Vollbracht believes the value of China to global sentiment cannot be underestimated, “The German export story shows that there is real value and real money is being made now. China´s importance to the global recovery is greatly understood, especially in Europe.”

Reliance Industries continues to dominate the Indian company agenda. Analysts were broadly cited on expansion opportunities, especially in its own domestic market where broadband services have given a positive lift to RIL´s tonality. Indian banks were generally received more positive than their Western counterparts. HDFC exemplified this difference with an improvement of positivity against an already high tonality for 2010. “For Asian banks there is little talk of exposure to sovereign debt, stress tests or criminal proceedings. India and the rest of Asia appear to be a very positive area for the banking sector” says Vollbracht.

Finally, bond markets were well covered in the second half of July with Spanish bond sentiment surging into positive territory for the first time in 2010. This led to an overall increase in European government bond sentiment and countered the general hostility still faced by Portugal and Ireland, both of which are suffering in the media from Moody´s continued skepticism. Greece´s rise in positivity will certainly be boosted by the fact that its banking sector performed relatively well in the stress test results. For Vollbracht the current discussion on bonds is an important signal for the market´s confidence in a country. “Bonds were rarely the main topic of economic discussion in the past, but as we come to the end of this European crisis, bond yields, along with company results, will be one of the unofficial indicators for economic health.”

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