China Reports Upbeat Economic Data

A slew of positive data was reported from China overnight, with second quarter GDP growth coming in at a hotter than anticipated 6.90%, topping the consensus estimate of a 6.80% increase during the April to June period. China is targeting slower annual economic growth of 6.50% this year versus the 6.70% pace recorded in 2016. With the first two quarters of year recording 6.90% expansion, the Chinese government will now have a greater cushion to absorb slower growth during the second half of the year when tightened policy and deleveraging are likely to commence.

Separately, industrial output and retail sales came in well ahead of expectations at 7.60% and 11.00% respectively. Fixed asset investment from January to June also rose 8.60% year-on-year, edging past a Reuters poll of 8.50%. After tumbling last week, USDCNH is modestly higher on the session, trending near 6.7700.

UK Brexit Secretary David Davis will resume a fresh round of negotiations on Monday when he meets the European Commission's Michel Barnier in Brussels to discuss the terms of his country’s withdrawal from the European Union. With a little over a year left to settle the terms of the divorce before Britain exits on March 30^th, 2019, the EU countries want British Premier Theresa May to gather her divided country behind a clear and detailed withdrawal plan that can minimize social and economic disruptions across the currency bloc.

Negotiators from both teams will break into separate groups to discuss two key areas - citizens' rights and the EU’s demand that the UK pay EUR 60 billion to cover budget commitments - before a scheduled news conference on Thursday. FTSE 100 futures are up in Monday morning trade to currently hover around 7330.