The Footsie was trading just below the 5,500 level at midday, with banks and miners providing a drag on London's blue chip index. It seems that markets across Europe have given a lukewarm reaction to the 'fiscal compact' agreed by (some) EU leaders late last week, with indices in Paris, Frankfurt and Madrid falling over 1% each today.MARKETS DIGEST SUMMITSpeaking at a business conference in Tel Aviv ratings agency Standard & Poor's (S&P) chief economist for Europe, Jean-Michel Six, has described last week's agreement by the European Union as "significant." However, he added: "let's not raise expectations too high, there will be more summits (...) time is running out and action is needed on both sides of the equation, on the fiscal and monetary side." According to Gary Jenkins from Evolution Securities, this week will be the "first real market test of the summit" as markets have had the weekend to digest the outcome and the continent should be braced for multi-sovereign downgrades from S&P in the near-future."High levels of debt, the rising risk of a recession and tightening credit conditions are all still with us after the summit and there was little in the way of real action to deal with any of them...So all things considered downgrades seem the most likely outcome from this starting point and I would expect them to occur early as this week."Meanwhile, in its latest weekly credit ratings agency Moody's stated that, "as we announced in November, unless credit market conditions stabilise in the near future, our ratings of all EU sovereigns will need to be revisited." In other news, the Italian Treasury has issued €7bn in one-year debt at a yield of 5.952%, versus 6.087% the last time around. The fall in yields may provoke a positive reaction in risk trades, some market watchers are saying. Italian 10-year bond yields however were rising sharply, moving up by 29 basis points to 6.65%. DEFENSIVES IN DEMAND, BANKS AND MINERS FALLTobacco giants British American Tobacco and Imperial Tobacco were among the high risers of the day, helped by Investec which upped the target prices for both stocks today, whilst keeping its buy recommendations."Our equity strategy call is to be long equities, but to be defensively positioned within this, given what we see as material earnings risk in the wider market...Both BAT and IMT have their attractions and, in a macro-driven world, we think investors could do worse than have equally-weighted exposure to each," said analyst Martin Deboo.Utilities were also performing well, with SSE, Centrica, Severn Trent and National Grid making moderate gains. Banks were on the decline today, with Royal Bank of Scotland (RBS) in focus after the long-awaited report from the Financial Services Authority (FSA) on the near-collapse of the bank which necessitated a government rescue. The FSA highlighted seven factors that contributed to the bank's fall from grace. These included: significant weaknesses in the bank's capital position; over-reliance on risky short-term wholesale funding; concerns about about RBS's underlying asset quality; the disastrous acquisition of ABN Amro.Sector peers Lloyds, Barclays and Standard Chartered were also falling, with the latter not being helped by Investec which cut its target price for the stock from 1,650p to 1,550p.With metals prices in retreat, the miners were out of favour on Monday. At midday, copper was down 2.33%, gold was 1.99% lower while silver had fallen 2.8%. ENRC, Xstrata and Kazakhmys were falling at lunchtime. For ENRC, this weekend's corruption rumours have weighed on the share price. The Sunday Times reported that the Serious Fraud Office had launched an enquiry into allegations of fraud at SSGPO, the company's iron ore business in Kazakhstan.As for Xstrata, UBS has cut its target price for the stock from 1,550p to 1,450p, after accounting for higher maintenance capital expenditure.FTSE 250 MOVERS: CSR AND MOTHERCARE JUMPWireless technology and computer chip company CSR roared higher after announcing that it will be discontinuing investment in the areas of digital television systems-on-a-chip and silicon tuners. CSR expects to realise, on an annualised basis, $60m of operating cost reductions as a result of these changes and other efficiency savings, and to incur an incremental $10m of restructuring costs by the end of the second quarter of 2012. Also on the up among FTSE 250 stocks was baby and toddler products vendor Mothercare, on the back of bid speculation. Private equity groups are said to be sniffing around the company, which is having a tough time of it in the UK, although the overseas operations seem to be doing fine. The company slumped into the red at the half-year stage, and the shares have lost almost three-quarters of their value over the last year. BCFTSE 100 - RisersGlaxoSmithKline (GSK) 1,444.50p +1.44%Imperial Tobacco Group (IMT) 2,383.00p +1.36%SSE (SSE) 1,269.00p +1.12%Diageo (DGE) 1,375.00p +1.10%British American Tobacco (BATS) 3,031.00p +1.08%Next (NXT) 2,622.00p +1.04%Associated British Foods (ABF) 1,096.00p +1.01%SABMiller (SAB) 2,205.00p +0.96%Centrica (CNA) 289.40p +0.91%Sage Group (SGE) 289.10p +0.87%FTSE 100 - FallersLloyds Banking Group (LLOY) 24.95p -6.63%Inmarsat (ISAT) 400.10p -5.50%Royal Bank of Scotland Group (RBS) 20.83p -5.28%Eurasian Natural Resources Corp. (ENRC) 649.00p -5.26%Essar Energy (ESSR) 213.70p -4.13%Aviva (AV.) 309.70p -3.61%Schroders (Non-Voting) (SDRC) 1,076.00p -3.41%International Consolidated Airlines Group SA (IAG) 148.80p -2.94%Xstrata (XTA) 982.60p -2.86%Kazakhmys (KAZ) 916.00p -2.86%FTSE 250 - RisersCSR (CSR) 185.10p +10.97%Mothercare (MTC) 172.80p +7.60%Cable & Wireless Worldwide (CW.) 18.04p +3.86%Allied Gold Mining (ALD) 171.90p +3.24%Thomas Cook Group (TCG) 15.63p +3.03%Gem Diamonds Ltd. (DI) (GEMD) 185.30p +2.77%Daejan Holdings (DJAN) 2,792.00p +2.46%SThree (STHR) 213.40p +2.35%Synergy Health (SYR) 846.50p +2.11%Imagination Technologies Group (IMG) 458.60p +2.07%FTSE 250 - FallersInternational Personal Finance (IPF) 193.80p -5.05%Fidelity China Special Situations (FCSS) 75.20p -4.57%London Stock Exchange Group (LSE) 785.00p -4.27%Ferrexpo (FXPO) 276.60p -3.89%African Barrick Gold (ABG) 490.60p -3.61%Pace (PIC) 69.25p -3.55%Afren (AFR) 81.50p -3.49%Spirent Communications (SPT) 115.80p -3.42%RPC Group (RPC) 343.50p -3.24%EnQuest (ENQ) 91.00p -2.99%