While we managed to get some rebound in broader European stock markets yesterday, this week’s news from China has done some significant damage to overall sentiment in general, as the gains of the last two weeks have slowly dissolved. The FTSE100 in particular lagged behind giving up yesterday’s early gains as oil prices resumed their recent weakness with US prices hitting their lowest levels since 2009. While Brent prices are holding up rather better, still trading above their lows this year, yesterday’s actions by Switzerland in removing Iranian sanctions are a timely reminder of the potential supply overhang when Iran chooses to expand its production output, particularly if other countries follow the Swiss lead. US stocks continue to thrash about indecisively as investors weigh up not only the prospects of a US rate rise next month, but also whether it will be a positive or a negative for US stocks, if it comes, though it is noticeable that the Russell 2000 continues to show continuing signs of threatening to roll over. While yesterday’s session was a slightly calmer one as a result of a rare press conference from Chinese central bank officials explaining their recent actions, it would appear the genie is out of the bottle, and the markets main preoccupation now is how much lower can the Yuan potentially go in the coming weeks, and what effect will it have on price inflation in the coming months. As for today the main focus will be on two distinct areas namely the latest finance ministers meeting in Brussels and the latest Q2 GDP numbers from France, Germany, Italy and the wider EU, as well as the final EU CPI numbers for July. No surprises as to what will be being discussed at the Eurogroup meeting, namely the latest Greece bailout, where we have the spectacle of Germany being slowly backed into a corner on the subject of debt restructuring, after the EU backed the IMF’s position over Greece’s debt sustainability, or rather the lack of it. Given Germany is opposed to debt relief the question of how any bailout can be agreed without IMF involvement is a significant concern, even before you consider whether Greek Prime Minister Tsipras is able to get the 47 prior actions through the Greek parliament that were said to be needed by Finland’s finance minister Alex Stubb yesterday, for aid to be unlocked. On the data front, with the Spanish economy enjoying a continued economic renaissance and currently growing at an annualised 3.1% in Q2, and Greece surprising with a “rubs eyes” 0.8% expansion in Q2, expectations are for a fairly good set of GDP numbers, though Greece’s numbers are likely to be a one-off, given they don’t include the July cliff edge of capital controls, and manufacturing collapse. Unfortunately things are rarely that simple in Europe, with no improvement from Q1 expected for both France and Italy in the second quarter. France is expected to post an expansion of 0.2%, down from 0.6% in Q1, while Italy is expected to show an expansion of 0.3%, unchanged from Q1. The main concern in these two economies is the trend of continuingly growing levels of unemployment, particularly youth unemployment, while German Q2 GDP is expected to keep ticking along coming in at 0.5%, up from 0.3% in Q1. Overall these numbers should translate into an overall positive improvement in EU Q2 GDP, with a year on year improvement of 1.3%, though the quarterly measure is expected to come in at 0.4%, unchanged from Q1. The wider worry remains around CPI inflation and while Spain appeared to finally escape annualised deflation earlier this week, the monthly numbers remain a worry. While the latest Y/Y CPI numbers are expected to show 0.2% rise the monthly number is expected to show a slide of 0.6%, not surprising given the slide in commodity prices in recent weeks. This slide in commodity prices is expected to be reflected in today’s US PPI factory gate prices for July, with weaker numbers expected from the June numbers. EURUSD – having broken through the 50 day MA earlier this week, thus far we’ve stayed above it at 1.1080. While we do so we remain on course for a retest of the 1.1220 level. A move back through 1.1080 retargets the 1.1020 area, while a move through 1.1230 retargets a move towards 1.1450. GBPUSD &ndash the pound is currently trading in a 220 point range between 1.5460 and 1.5680. We also have fairly solid support towards the converging 100 and 200 day MA at 1.5390. The high of the last five weeks at the 1.5680 level remains a key resistance on the upside. A move above 1.5700 has the potential to retarget the 1.5820 level. EURGBP – finding support at higher levels we need to stay above yesterday’s low at 0.7100 to argue for a retest of the 0.7200 area and trend line resistance from the May highs at 0.7480. Support is likely to come in now at the 0.7120 area, with a fall below signalling a retest of 0.7070. USDJPY – despite a quick look above 125.00 earlier this week, we soon drifted back down. There does seem to be significant resistance above which makes the prospect of a sharp move lower quite likely. As such we could see a move back towards the 123.75 area, and then 123.00. Only above 125.90 argues for a move towards 127.20. CMC Markets is an execution only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.