Wholesale trade rose in July Statistics Canada reported this morning, but the news is only moderately positive for markets because the trend since February has been downward.

Wholesale sales grew 1.1% in July, as wholesalers sold $36.2 billion worth of goods and services. This follows a period of strong growth for wholesale sales from the fall of 2001 to January 2003.The slowdown in wholesale sales since February was partly a reflection of weak international trade. Exports fell four times during this period.

Six of the eleven sectors posted an increase in July. The most significant increases were in computer and electronic products (+9.1%), lumber and building materials (+5.3%) and beverage, drug and tobacco products (+4.3%). The July increase was partly dampened by lower wholesale sales in the other products category (-2.8%) (which includes seeds and chemicals, as well as other farm supplies), and in motor vehicles, parts and accessories (-1.3%).

There are no major data releases in the United States today.

It expected to be a weak morning for equities despite record highs reached by American markets yesterday.

Overnight, Tokyo’s Nikkei average fell 94.90 points to 10,938.42, after closing above 11,000 on Thursday. In Hong Kong, the Hang Seng index fell 100.80 points to 10,968.42.

In Europe at midday markets are down. Paris’s CAC-40 index was down 1.2%. Investors are worried about the future of engineering giant Alstom. Trading in Alstom shares was suspended, but the market fell due to concern about the impact of the company’s plight on banks, suppliers and the economy in general. In London, the FTSE 100 index is down 33.2 points to 4,281.5 or 0.8%. Frankfurt is off 0.6%.

On Thursday, the Nasdaq composite index closed above 1,900 for the first time in 18 months. The Dow Jones industrial average and Standard & Poor’s 500 index reached 15-month highs after an encouraging employment data and an upbeat report on U.S. leading economic indicators. In Canada, the S&P/TSX composite fell 12.99 points to 7,600.59, due to a drop in energy stocks.

In other news, the man expected to be Canada’s next prime minister, Paul Martin, is promising that he will lead a tight-fisted government, lowering taxes and reducing debt. Martin is dismissing Prime Minister Jean Chretien’s advice earlier this week about freezing tax cuts and boosting social spending. He says that it is essential that Canadians lower our national debt load in order to keep our interest rates low and keep the flexibility we need to respond to an unpredictable international economy.