Mixed data out yesterday muddied the picture in the world markets.
In the UK, the British Chambers of Commerce (BCC) reported that UK export activity has reached its highest level since the financial crisis erupted in 2008. The BCC report shows a trade index rising to 118.12 in the three months to June 2013, up 2.9% on the same period last year.
The report includes a business confidence assessment and the results suggest exporters are optimistic over future sales and profits with 42% of manufacturing firms reported higher export sales and 31% of firms expect to increase staffing levels this year.
John Longworth, director general of the BCC commented that "For the first time on record, these results are positive across the board. Export sales and orders have gone up, confidence is high and expectations around profitability have increased".
By contrast, overnight HSBC reported that China's manufacturing activity fell to an 11-month low in July with the bank's Purchasing Managers' Index (PMI) falling from a figure of 48.2 in June to 47.7.
The PMI is a key activity indicator and any reading below 50 indicates a contraction in the sector. This is the third month in a row that the HSBC reading has been below the 50 mark.
The data comes amid widespread fears of a slowdown in China's overall economy. Earlier this month, data showed that China's economic growth slowed in the second quarter of this year, the second straight quarter of weaker expansion with registered growth of 7.5% compared to the previous year. In the first quarter of this year, growth was registered at a rate of 7.7%.
By contrast, data out overnight showed that Japanese exports continue to recover, boosted by a weak yen and a revival in demand from Europe. This is the fourth month in a row of rising exports. The latest data shows export growth of 7.4% from a year earlier with sales to the European Union (EU) rising by 8.6%, the first jump in this sector’s data in 21 months.
Today sees the publication of further housing data from the US and the monthly policy announcement from the Reserve Bank of New Zealand.