Asian shares oscillate between gains and losses ahead of key Chinese data By Reuters

By Ritvik Carvalho

LONDON (Reuters) – The first weekly loss recorded since Friday in May has been on the brink of a decline, and the dollar has fallen for the third day in a row, as US inflation is still stronger than expected. not shaken interest rate cuts from the Federal Reserve.

European stocks rose after a series of modest falls this week and investors also digested a weekend snowstorm containing Chinese data. The pan-European STOXX 600 index () was up 0.2% at noon in London.

The all-country MSCI country index, which tracks stocks in 47 countries, has not moved by the day and is about to break a series of gains in five weeks.

E-mini futures have increased 0.2%.

Data from China showed that Beijing's exports fell in June when the United States increased trade pressure, while imports fell more than expected, pointing to new tensions in the world's second-largest economy.

(Trade with China: imports and exports (https://fingfx.thomsonreuters.com/gfx/editorcharts/GLOBAL-MARKETS/0H001QEHL78P/index.html)

"Export data was really weak and it's a sign that the trade war has begun to bite Chinese exporters and that companies are starting to reorient their supply chains," said economist Stefan Koopman. market leader at Rabobank in Utrecht, the Netherlands.

"European markets are waiting for information on what is happening between the United States and China in terms of trade."

The data come after a series of disappointing economic reports from around the world, which showed that the global economy was suffering from a long trade war between the United States and China, which forced the major central banks to take a longer stance. accommodative.

China is also expected to release GDP figures for the second quarter on Monday, which should show that the world's second-largest economy has slowed to its slowest pace in at least 27 years.

Industrial production in the euro area rose more sharply than expected in May, offsetting the declines in the past two months and defying the gloomy forecast due to prolonged trade tensions.

This positive reading could undermine European Central Bank policy makers, who favor more stimulus to counter weak growth and low inflation in the euro zone, although economists warn that this improvement would only temporary.

The ECB's decision-makers meeting last month agreed on the need to be ready to further stimulate the Eurozone economy in an environment of "heightened uncertainty," the report said on Thursday. official meeting.

In Asia, the broadest index of MSCI shares in Asia-Pacific excluding Japan declined 0.2%.

Against a basket of currencies, the dollar was down for a third day in a row, down 0.1%. A more vigorous than expected reading of the defeat has not shaken the belief that the Federal Reserve will begin to cut interest rates at a political meeting later this month.

The main consumer price index, excluding food and energy, rose 0.3% in June, the largest increase since January 2018, according to data released on Thursday.

Reading pushed US Treasury yields higher, but the money markets still showed a rate cut at the end of July and a cumulative reduction of 64 basis points by the end of 2019 .

The comments of Charles Evans, president of the Chicago Fed, are expected later Friday and John Williams (NYSE :), president of the New York Fed Monday, will give the opportunity to gauge the dynamism of the central bank, said Masafumi Yamamoto, chief foreign exchange strategist at Mizuho Securities.

"If these Fed officials are not as accommodating as Powell, and if the manufacturing survey conducted Monday by the New York Fed turns out stronger than expected, they could show that the ## 147 ## The weakening of the dollar following Powell's testimony in Congress was excessive. "

Elsewhere in currencies, the euro () benefited from a sell on the German bond market, up 0.1% to $ 1.1270.

Security haven The German government bonds have been sold for their biggest weekly sale for nearly a year and a half, while signs of economic might in the United States and parts of Europe left predict a burst of recession.

Oil prices have been close to the highs of the last six weeks and were on track for a weekly gain as US producers in the Gulf of Mexico cut production by more than half due to a tropical storm and lingering tensions in the Middle-East.

The global benchmark rose 0.24% to 66.68 dollars a barrel. WTI (West Texas Intermediate) crude in the United States rose 0.03% to $ 60.22 per barrel.

Gold prices, weakened by stronger than expected US consumption inflation data, have regained their luster thanks to renewed commercial concerns and expectations of rate cuts. last trading up 0.3% to $ 1,407.61 an ounce.

Nickel prices in Shanghai recorded their strongest weekly gain since June 2018 as investors bounced on the potential demand for metal in the electric vehicle battery sector.