Global

Global Capital Spending to Fall for Third Straight Year. The world's top-spending corporations are set to cut back on investment in 2015 for the third year in a row, as a commodities sell-off hits confidence. Capital expenditure (or capex) by non-financial corporations is set to fall by 1% this year and by 4% in 2016, according to S&P's 2015 global capex survey, which tracks the top 2,000 public and private corporate spenders. This year's decline would be mainly due to the energy and materials industry, which is set to cut spending by 14%. Excluding energy and materials, global capital spending is estimated to rise by 8%. (Reuters)

Malaysia

Malaysia New Export Orders up in July. Malaysia's new exports rose for the sixth month in a row in July, according to the Nikkei Malaysia Manufacturing Purchasing Managers' Index (PMI). Firms attributed the increase to gaining new foreign clients and product launches. Nikkei Malaysia Manufacturing PMI is an indicator of manufacturing performance derived from indicators for new orders, output, employment, suppliers' delivery times and stocks of purchases. Malaysia's headline PMI was marginally higher at 47.7 in July from 47.6 in June. (Bernama)

Short-Term Rates to Remain Stable on BNM's Intervention. Short-term interbank rates are expected to remain stable today on Bank Negara Malaysia's (BNM) intervention to absorb excess liquidity from the financial system. BNM estimated today's liquidity at RM34.21 billion in the conventional system and RM12.5 billion in Islamic funds. At 4 pm on Monday, the central bank will conduct an up to RM30.2 billion in conventional overnight tender and a RM8.9 billion Qard overnight tender. (Bernama)

Asia

China PMI for July surprises by dropping to two-year low. A key China economic indicator took a sharp turn for the worse, with the final reading for the Caixin China purchasing managers' index (PMI) for July surprising with a drop to a two-year low. "The downturn in China's manufacturing sector intensified at the start of the third quarter. Renewed falls in both total new work and new export orders led manufacturers to cut production at the fastest rate since November 2011," the news release said. The reading came in at 47.8, well below the 50-mark separating growth from contraction and also lower than the preliminary reading of 48.2, which also surprised markets on the downside. The data paint a darker picture than the official China PMI, released on Saturday, which avoided falling into contraction territory by coming in at 50 for July. (CNBC)

South Korea Posts Record Current Account Surplus. South Korea on Monday posted a record current account surplus for the first half of this year as slumping oil prices helped offset the impact of shrinking exports. The current showed an unprecedented surplus of $52.4 billion in the six months to June. The surplus for June also hit a record monthly high of $12.2 billion. For June alone, the value of imports tumbled 17.3% on-year to $36.1 billion. The value of exports meanwhile fell to $279 billion for January to July, down 10.6% compared to the same period last year. (AFP)

India’s Manufacturing PMI Speeds to Six-Month High in July. Indian manufacturing activity expanded at its fastest pace in six months in July as new export orders accelerated. The Nikkei Manufacturing Purchasing Managers’ Index (PMI) rose to 52.7 in July from June’s 51.3. The new export orders sub-index jumped to 54.5 from 51.8, the highest reading in five months, which coupled with a similar increase in domestic orders suggests renewed demand for Indian goods both home and abroad. (Reuters)

Japan's Economy Shrank 0.1% in June. Japan's real GDP contracted 0.1% from the previous month in June, declining for a third consecutive month, the Japan Center for Economic Research said Monday. Real personal spending decreased 0.4% to slip into negative territory. Capital spending dropped 1.4%, declining for the second month in a row and weighing down the overall economy. Exports inched up 1% and imports rose 0.2%. (Nikkei)

Americas

US Manufacturing Growth Slows in July. U.S. factories were a little less busy last month. The Institute for Supply Management's manufacturing index slipped to 52.7 last month from 53.5 in June. Economists had expected the index to remain unchanged. Factories' exports are contracting, partly because a strong dollar makes U.S. goods more expensive. Hiring slowed at U.S. factories last month, but production and new orders rose. (AP)

US Consumer Spending Edges up in June. Consumer spending in June rose by the smallest amount in four months as shoppers cut back on purchases of cars and other big-ticket items. Consumer spending edged up 0.2% in June, the poorest showing since a similar increase in February. Overall purchases of durable goods, the category that covers autos, fell 1.3% in June. For the full April-June quarter, consumer spending posted a solid gain, rising at an annual rate of 2.9%. The improvement in consumer spending was the biggest factor boosting overall economic growth to 2.3% in the second quarter. (AP)

U.S. Treasury Says Plans to Borrow More in Third Quarter Than Previously Expected. The U.S. Treasury said on Monday it would borrow more in the July-September period than previously estimated so that it could hold a bigger cash buffer and because of a slightly larger than anticipated fiscal shortfall. The Treasury said it would borrow $127 billion through credit markets during the period, up from an initial estimate of $66 billion. The Treasury said it expected to borrow $270 billion during the last three months of the year. (Reuters)

Europe

German Manufacturing PMI Posts Modest Growth. German manufacturing activity rose slightly for the eighth straight month in July, a sign that Europe's largest economy began the third quarter in growth mode. Markit's purchasing managers' index (PMI) for manufacturing, which makes up about 20% of the German economy, stood at 51.8 compared with 51.9 in June. Factory output increased for a 27th straight month. Manufacturers stepped up recruitment and they continued to make more purchases. On the downside, volumes of new orders from abroad fell for the first time in six months. (Reuters)

UK Manufacturing PMI Edges up, Still Dragging on Economy. British manufacturing growth picked up in July but new orders grew at the slowest pace in nearly a year, suggesting the factory sector would continue to drag on overall economic growth. The Markit/CIPS manufacturing purchasing managers' index (PMI) rose more than forecast in July to 51.9, up from 51.4 in June. The pace of growth of new orders slowed to 52.2, its lowest since September 2014. (Reuters)

Eurozone Flash PMI Slips Back in July. Business activity in the 19-member euro zone eased in July, suggesting the recovery lost momentum at the start of the second half of the year. The Markit flash euro zone composite purchasing managers' index, which measures activity in manufacturing and services sectors, fell month on month to 53.7 in July, down from a four-year high of 54.2 in June. French preliminary PMI for the service and manufacturing sectors fell to 51.5 in July from 53.3 in June. (CNBC)

Currencies

Dollar Gains as Upcoming Jobs Data Stokes Rate Hike Expectations. The dollar gained on Monday as investors looked ahead to jobs data on Friday that is expected to show a still strengthening labor market. The dollar last traded against the euro at $1.0948. The dollar index was traded at 97.508 on Monday, up 0.17% on the day but below a one-week high of 97.773 set last Thursday. The Canadian dollar and emerging market currencies weakened as crude oil prices fell. The Canadian dollar fell to its lowest level in more than a decade against the greenback. The dollar rose to Canadian dollar 1.3175, its highest since September 2004. (Reuters)

Commodities

Oil Dives 5% to Six-Month Low. Oil prices lurched 5% lower on Monday to their lowest since January, taking global benchmark Brent below $50 a barrel as weak factory activity in China deepened a commodity-wide rout. Brent settled down $2.69, or 5.2%, at $49.52 a barrel. U.S. crude settled down $1.95, or 4.1%, at $45.17, just about $3 above its 2015 bottom. U.S. crude had already fallen 21% in July. The rout deepened after data showed Chinese manufacturing growth unexpectedly stalled in July and U.S. consumer spending advanced at its slowest pace in four months in June. (Reuters)

Gold Down on Dollar After Worst Month in Two Years. Gold dropped on Monday, after falling by the most in two years in July, as the dollar rose and investors monitored U.S. economic indicators for clues on the timing of a hike in U.S. interest rates. Spot gold was down 0.9% at $1,086.06 an ounce by 1902 GMT. Spot platinum dropped 2.6% to $955.74 an ounce, after posting the biggest monthly fall in ten months at 8.7% in July. Palladium lost 2.3% to $595.25 an ounce, nearing the lowest since October 2012. (Reuters)