The 6am Cut London

Rajoy presents the Spanish bank bailout as a victory says the FT, although there are fears it raises more questions about the country’s level of sovereign debt. The 17 eurozone finance ministers agreed to lend up to €100bn to the banks via the country’s bank restructuring fund, Frob. Although the deal is relatively light on conditions, the amount lent to each bank will be deciced by the European Commission and tough new rules for the finance sector are expected. Now Italy moves into the crosshairs, says Bloomberg. And so does the Greek election, says the WSJ.

Markets are tending to agree with Rajoy, with the MSCI Asia Pacific up 1.6%, its biggest gain in two months, reports Bloomberg. The euro strengthened 1% to $1.26.

Francois Hollande looked close to securing a majority in the National Assembly on Sunday night, reports the FT. If he succeeds in next weekend’s second round, Hollande will be able to start implementing his growth plans and rejecting at least part of the austerity drive of his predecessor.

China’s inflation, industrial output and retail sales all flagged in May for a second straight month of sluggish growth, according to official data published on the weekend, says Reuters, raising hopes of more stimulus measures.

China’s exports rose more than expected in May, reports Bloomberg. However growth in industrial metal production slowed slightly from April, as broader macroeconomic demand weakened, according to official data, reports the WSJ.

Facebook’s April unique viewer numbers grew at the slowest rate on record, as measured by comScore, says the WSJ.

UK banks will get to put more inside the Vickers retail ringfence, says the FT, such as simple interest rate and currency hedging tools. George Osborne will outline details on Thursday.

Goldman Sachs is close to selling its hedge fund administration business to State Street, reports the FT, citing people familiar with the sale.

COMMENT AND CURIOS

- Spain gets get-out-of-jail card… until you look at the sovereign, says Gavyn Davies. (Financial Times)

- If Spain confronted the bank problems earlier, it could’ve funded them itself. (Wall Street Journal)

- Some of the UK’s biggest fund managers are pushing banks and other blue-chip companies to adopt genuinely long term incentive plans. (Financial Times)

- Greek tourism is being battered by fear and uncertainty. (Reuters)

OVERNIGHT MARKETS: UP

Asian markets responded positively to the Spanish deal and Chinese data over the weekend. [More]