Before the open - 01/08

Asian shares were up last night on the back of unexpected good manufacturing data from July.

The NBS purchasing managers’ index came in at 50.3 – up from 50.1 the month before and above expectations of 49.8 (above 50 indicates growth, below contraction). HSBC’s measure of manufacturing PMI, however, said the industry shrank, coming in later at 47.2 in line with expectations, but slightly below June’s measure of 48.2. This pulled stocks down a little, but not enough to temper gains of around 1.1 per cent in the Shanghai Composite and 0.5 per cent in the Hang Seng.

The Australian dollar, closely linked to Chinese growth due to trading links, fell below 90 US cents for the first time in three years last night on the back of better-than-expected US GDP data and unexpected quarterly falls in the import and export price indices.

The FTSE is expected to open slightly up today after Barclays and BP pulled down the index yesterday.

The big events to watch today are monetary policy decisions from the Bank of England and European Central Bank.

Key events today:

Italian July Markit manufacturing purchasing managers’ index (PMI) at 08:43. Expected to rise from 49.1 to 49.8 (above 50=growth).

French July Markit manufacturing PMI at 08:48. Expected to increase from 48.4 to 49.8.

German July Markit manufacturing PMI at 08:53. Expected to rise from 48.6 to 50.3.

Eurozone July Markit manufacturing PMI at 08:58. Expected to fall from 50.1 to 48.8.

UK July Markit manufacturing PMI at 09:28. Expected to increase from 52.5 to 52.8.

UK Bank of England August interest rate decision at 12:00. Expected to stay flat at 0.5 per cent. Asset purchases expected to remain flat at £375bn.

European Central Bank interest rate decision at 12:45. Expected to stay flat at 0.5 per cent.

European Central Bank monetary policy statement and press conference at 13:30.

US 26 July initial jobless claims at 13:30. Expected to increase from 343,000 to 346,000.

US July Markit manufacturing PMI at 13:58. Expected to rise from 51.9 to 53.1.

US June construction spending at 15:00. Expected to fall from 0.5 per cent to 0.4 per cent month-on-month.

US July Institute for Supply Management manufacturing PMI at 15:00. Expected to increase from 50.9 to 51.5.