Asia

China’s Factories Spring Back To Life. Activity in China’s vast factory sector expanded at the fastest pace in 27 months in July, while industry surveys across Asia showed a pick up in export orders that hinted at a long-awaited revival in global trade. China’s official manufacturing purchasing managers’ index (PMI) rose to 51.7 in July, the strongest since April 2012 and up from 51 in June, the National Bureau of Statistics said yesterday. Economists had expected a reading of 51.4. The upbeat result was echoed in the HSBC/Markit China measure of manufacturing, which climbed to an 18-month peak of 51.7, from June’s 50.7. (Reuters)

China July Official Services PMI Dips To Six-Month Low. Growth in China's services sector slipped to a six-month low in July as new orders rose at their weakest rate in at least a year, data showed, taking some of the shine off an industry that has been a bright spot in the Chinese economy this year. The official Purchasing Managers' Index (PMI) for the nonmanufacturing sector slowed to 54.2 in July from June's 55, the National Bureau of Statistics said on Sunday. That is the weakest reading since January. (Reuters)

China Central Bank Signals No Broad Monetary Easing. The People’s Bank of China warned that the country’s credit and money supply have increased rapidly and indicated that it will refrain from broader monetary easing to support growth. “The total debt level has been rising relatively quickly,” the PBOC said in its second-quarter monetary policy report on Aug. 1. “Our existing money supply and credit are already relatively large and their growth is also high.” The central bank reiterated it will use tools including open market operations, reserve requirement ratios, relending, standing lending facilities, and short-term liquidity operations to adjust liquidity, according to the report. (Bloomberg)

Americas

Hurdle for Declining US Unemployment as Participation Steadies. The laborforce participation rate is starting to stabilize, putting the onus on hiring to push down joblessness in the U.S. The share of Americans employed or looking for work rose to 62.9% in July, Labor Department data showed today. The increase helped push up the unemployment rate to 6.2% from 6.1% in June as some applicants failed to land a job. Over the past nine months, participation has gained 0.1 percentage point, the best performance over a similar period since 2008. (Bloomberg)

U.S. factory activity expands in July, pace slows. The U.S. manufacturing sector expanded in July, but the pace of growth slipped from the previous month as growth in output, new orders and employment slowed, an industry report showed on Friday. Financial data firm Markit said its final U.S. Manufacturing Purchasing Managers Index slipped to 55.8 in July, down from the 57.3 June reading that was the highest since May 2010. The preliminary read for the index was 56.3. A reading above 50 signals expansion in economic activity. The last reading below 50 came in September 2009. (Reuters)

US Consumer Sentiment Dips In July. U.S. consumer sentiment edged down in July, while an index of consumer expectations weakened for a third straight month, a survey released on Friday showed. The Thomson Reuters/University of Michigan's final July reading on the overall index on consumer sentiment came in at 81.8, a touch below the 82.0 estimate and down from the final June reading of 82.5. "What has recently dominated the attention of consumers is job and income growth," survey director Richard Curtin said in a statement. "Despite the recent improvement, consumers have yet to take recent economic gains to indicate that more robust growth in jobs and wages will be forthcoming." (Reuters)

Argentine Bonds Decline As Default Triggers $1 Billion Of Swaps. Argentine bonds posted the biggest two-day loss since 2012 as a committee ruled that the failure to pay interest will trigger $1 billion of credit-default swaps. The International Swaps & Derivatives Association’s determinations committee made the ruling on the contracts in response to a question posed by Swiss bank UBS AG after the government missed a July 30 payment deadline on $539 million of notes. Argentina is the first nation to trigger the insurance since Greece restructured its debt in 2012. (Bloomberg)

Europe

German Economic Growth To Be Hit By Ukraine Crisis, Ifo Head Says. German economic growth will shrink towards zero in the second quarter due to the Ukraine crisis and the tough new economic sanctions imposed on Russia from 0.8% in the first quarter, the head of Germany's Ifo institute said on Saturday. Ifo president Hans-Werner Sinn wrote a guest column for Wirtschaftswoche magazine in which he said the worsening crisis meant forecasts that Europe's largest economy would expand by 0.3% in the second quarter have to be revised down. "The growth forecast that Ifo presented last month will likely have to be revised downward. The assumption that the second quarter will have had grown 0.3% from the first quarter can no longer be held onto. It's more likely that there was zero growth in the second quarter," Sinn wrote. Sinn added growth forecasts for the third quarter will also have to be changed due to the Ukraine crisis and sanctions.

Currencies

Dollar Declines Vs. Rivals As Rate-Hike Prospects Soften. The U.S. dollar pulled back against the Japanese yen and other rivals Friday after July jobs data softened prospects of an interest-rate increase by the Federal Reserve coming sooner than later. The dollar was buying ¥102.70, down from around ¥102.99 just before the U.S. Labor Department released its jobs report. The economy added 209,000 jobs, which was less than the 235,000 jobs that economists in a MarketWatch poll had expected. The euro bought $1.3411 compared with $1.3393 after the report, and the pound traded at $1.6834 versus $1.6818. The ICE U.S. dollar index, which measures the greenback’s performance against a basket of six other currencies, fell to 81.367 from 81.446 on Thursday. (MarketWatch)

Commodities

Oil Prices Tumble On Oversupply, Weak Demand. Brent and U.S. crude futures tumbled on Friday to the lowest settlement prices in months, as oversupply in the Atlantic basin and low demand outweighed worries over political tensions in the Middle East, North Africa and Ukraine. Oil prices ended the week down more than 3%, as forecasts for a supply glut in West African and European markets dragged Brent below $105 a barrel and U.S. crude below $98. Brent crude slid $1.18 to settle at $104.84 a barrel, its lowest settlement since April 2. U.S. crude fell 29 cents to settle at $97.88 a barrel, the lowest settlement since Feb. 6. U.S. crude notched its biggest weekly decline since January, almost 4.5%. (Reuters)

Gold Up About 1% After Disappointing U.S. Jobs Data. Gold rose nearly 1% on Friday, snapping a four-day losing streak, as disappointing U.S. nonfarm payrolls data dampened talk of an early interest rate rise by the Federal Reserve and increased bullion's appeal as a hedge. Spot gold was up 0.9% to $1,293.01 an ounce by 2:36 p.m. EDT (1836 GMT), rebounding from Thursday's six-week low of $1,280.76. U.S. COMEX gold futures for December delivery settled up $12 an ounce at $1,294.80. Among other precious metals, silver was down 0.5% at $20.24 an ounce, while platinum inched up 0.3% to $1,458, and palladium dropped 0.9% to $859 an ounce. (Reuters)