The US economy grew at a 2.4pct annual pace in the June quarter after an upwardly revised 3.7pct reading for the March quarter (previously reported as a 2.7pct gain). The employment cost index rose 0.5pct in the June quarter as expected by economists. The Chicago purchasing managers index rose from 59.1 to 62.3 in July. And consumer sentiment rose from an initial reading of 66.5 in July to 67.8.

The Chinese purchasing managers index slowed from 52.1 to 51.2 in July - the lowest reading in 17 months.

European shares fell for a third day on Friday. Banks led the declines while BP lost 1.8pct. The FTSEurofirst index fell by 0.3 pct but was up 5pct over the month. But while the UK FTSE fell 1.1pct on Friday, the German Dax gained 0.2pct.

US sharemarkets were largely flat on Friday as investors weighed mixed economic data. The Dow Jones fell by just over one point with the S&P 500 up 0.01pct, and the Nasdaq rose 3 points or 0.1pct. Over the week the Dow Jones rose by 0.4pct with the S&P 500 down 0.1pct and Nasdaq eased 0.7pct. Over the month the Dow Jones rose 7.1pct with both the S&P 500 and Nasdaq up 6.9pct.

US longer-term treasuries rose on Friday (yields lower) on deflationary concerns. US 2yr yields fell 4pts to 0.55pct and US 10yr yields fell 8pts to 2.905pct. Over the week US 2yr yields fell by 4pts and US 10 yr yields eased by 9pts.

Major currencies were mixed against the US dollar on Friday. The Euro traded between US$1.2980 to US$1.3090 in European and US trade to end near US$1.3045. The Euro has lifted to US$1.3060 this morning. The Aussie dollar rose from US89.65c to US90.60c, ending US trade near US90.40c. The Aussie has lifted to US90.55c this morning. And the Japanese yen held between 86.00 yen per US dollar to JPY86.70, before ending US trade near JPY86.40.

US crude oil prices rose on Friday as investors maintained optimism about economic prospects. The Nymex crude oil contract rose by US59c or 0.8pct to US$78.95 and was largely unchanged over the week. London Brent crude also rose by US59c to US$78.18 a barrel.

Base metal prices rose for the third straight day on the London Metal Exchange on Friday. Aluminium soared 4.2pct and other metals were up 0.9-2.3pct. Metals posted solid gains for the second straight week, rising between 3.8-7.6pct, with aluminium doing best and copper doing worst. And the Comex gold price rose in line with other commodities, lifting by US$12.70 an ounce to US$1,183.90. Gold fell US$4 in the week and lost 5pct in July.

Ahead: In Australia, there is a bank holiday in NSW and the ACT. The Performance of Manufacturing index is released together with new home sales and the monthly inflation gauge. In the US construction spending and the ISM manufacturing index are released.