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China data lifts markets

China data lifts markets

Trade data from China and a stronger Yuan fixing brought markets back to life overnight. The growth positive moves started in the Asia Pacific region yesterday after the better than expected numbers dropped mid-session. Despite the lift in stocks and industrial commodities, bonds and gold held their higher ground. This indicates ongoing central bank support, and lower for longer interest rates, remain an important part of the market psyche.

European and US indices are glowing green. Gains across both continents range between 1% and 2.5%. Regional futures markets indicate further gains for Asia Pacific markets today.

Data could dominate the global trading session. Japanese preliminary Q2 GDP and July inflation numbers for China arrive today. If either come in above forecasts there is potential to add to the positive momentum. Tonight the focus turns to the UK for the release of GDP, trade, investment, production, manufacturing and construction data. Forex traders could re-position ahead of the numbers deluge.

The Reserve Bank of Australia releases its quarterly statement on monetary policy this morning. There is a focus on growth and inflation forecasts, and some analysts expect they will be lowered.

Online real estate group REA reported a 58% decline in headline profit after booking a $173 million charge against its Asian operations. However underlying profits surprisingly rose, and both earnings and revenue lifted 8%. In an echo of yesterdays’ result from developer Mirvac Group, a decline in residential activity was offset by gains in industrial and office activity. Management issued a positive outlook, and REA investors will hope the share price follows Mirvac’s 6.5% post-result gain.

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