By James Langton

(July 14 – 09:00 ET) – U.S. PPI came in better than expected this morning with the
headline rate up sharply, 0.6%. The core rate was down 0.1%. This is the first core rate drop in five months. Economists were expecting a 0.5% rise in the headline and a 0.1% rise in the core rate. High energy prices are certainly affecting the rest of the economy.

U.S. retail sales came in up 0.5% in June. Excluding autos they were only up 0.2%. Canadian motor vehicle sales were expected to rise 0.7% in May after a 1.1% fall in April, but they came in down 2.7%. That’s much weaker than economists predicted.

U.S. futures are up in early morning trading. Markets are up in Europe, too, although a summertime Friday can be expected to be rather quiet. London’s FTSE is up 10 points to 6485. In France the CAC 40 is up 34 points to 6570. Germany’s DAX has gained 103 points to reach 7299.

German stocks are getting a boost after its upper House of Parliament approved US$24 billion in tax cuts, which are expected to spur economic growth and takeovers. Insurers are up on the news, pharmaceuticals are weak.

Crude oil is falling this morning after three days of rises. Traders are expectiing OPEC to increase production.

Markets finished on an up note in Asia. Japan’s Nikkei rose 106 points to 17142. The Hang Seng gained 137 points to 17586.