By Greg Peel

The Dow closed up 22 points, or 0.1%, while the S&P lost 0.2% to 1692 and the Nasdaq dropped 0.6%.

The ASX 200 did manage to hold above the longstanding resistance level of 5000 yesterday by rising tenuously to 5017. The Aussie dollar continues to shift higher, up 0.5% to US$0.9299 over 24 hours, as possibly the last of the shorts decides to square off ahead of the next development. That might come today with the release of Australia's June quarter CPI. In the minutes of the July meeting the RBA indicated its concern that the lower currency might fuel inflation.

It is very unlikely the impact of the lower Aussie, which takes time to filter through the economy into price adjustments, will be felt on this quarter's CPI. The market will be watching closely nevertheless, such that any print above/below the expected 0.5% quarter on quarter and 2.5% year on year results will likely shift the Aussie up/down. The irony is, of course, that the more the Aussie moves the more it counters the reason it is moving. A low print would likely rekindle expectations of an August rate cut.

The stock market will be hoping for an August rate cut, but perhaps will not be too devastated if the RBA holds off a little longer. Movement is unlikely to be significant in the lead-in to next month's corporate result season, but in the meantime we find Wall Street hovering at new highs and looking just a little nervous. Mixed economic data continue to roll in, but that's not so bad given the Fed has ensured it will respond accordingly. It is the mixed earnings results that are in greater focus at present as well as forward guidance, informing as to whether the US economy really is in a recovery or not.

At the beginning of July, Wall Street analysts were forecasting a consensus 6.0% increase in net S&P 500 earnings for the September quarter. On guidance included in June quarter reports to date, that figure has fallen to 5.6%. Wall Street is relatively happy about it, because recent quarters have typically featured more substantial downgrades. The season to date nevertheless continues to be very much an "alpha" affair of ups and downs.

The big "up" last night came from United Technologies, a leviathan of a conglomerate best known for elevators, air conditioning and alarm systems as well as aircraft and aerospace services among other things. A solid result saw United shares jump 3%, which is worth around 20 Dow points. On the other end of the scale the late report yesterday morning from Netflix, which saw its shares down 4% overnight, highlights some mostly disappointing results to date from the highly fancied tech sector. Hence underperformance for the Nasdaq.

The S&P 500 typically split the difference last night. Among other reports, Dow stocks posted mixed results with Travelers down 4%, DuPont up slightly, and AT&T down 1%. Having already offered up a pre-result downgrade, United Parcel Service saw little response to its result, while the big one after the bell last night was Apple. Despite warnings of a rotten result, Apple sufficiently beat expectations to see its shares up a ripe 3.8% in the aftermarket. Remember that Apple is one of the biggest companies in the US (briefly the biggest, after the iPad took off) but is not in the Dow.

Australian investors will also be heartened to know that US copper giant Freeport McMoRan posted an upside surprise that saw its shares up 3%, while major coal producer Peabody also surprised and its shares rose 5%. Peabody also received a boost from announced workforce cuts, which unfortunately includes its Australian interests.

It is notable that BA-Merrill Lynch analysts in Australia are particularly concerned about rising unemployment led by mining sector lay-offs, the impact of which will flow through to services and into the wider economy.

Last night's US economic data releases were also mixed. On Monday night we had an improving but still contracting Chicago Fed activity index, and last week we had very solid expansion numbers from the New York and Philly Fed districts. Last night it was the turn of adjacent Richmond, and its Fed surprised with a shock flip-over to minus 11 this month from plus 18 last month in this zero-neutral index.

The FHFA house price index (Fannie/Freddie mortgages) for May showed 0.7% growth, which was just shy of 0.8% expectation. Annual growth is nevertheless 7.3%, and everyone is happy.

Mixed data and mixed results, not to mention a little lingering monetary policy uncertainty, is keeping the retail investor masses at bay in the US despite the S&P hitting new all-time highs every other day. There is talk that a breach of 1700 might just provide a psychological spur, but figures for the month of June show that while US$64bn left the bond market as prices fell on Fed taper-talk, only US$7bn found its way into equities. The rest is parked in cash, wondering exactly what to do next.

The weak Richmond Fed index result was enough to see the US dollar index down 0.3% to 81.99 last night, while gold took another quiet step upwards by US$7.50 to US$1343.30/oz. Over in London, base metal trade has become increasingly subdued as traders depart for the Costa Del Sol, with the weaker dollar helping all metals up slightly last night. Copper was up 0.5%.

The oils stuck to the current script, with Brent up US29c to US$108.44/bbl and West Texas up US20c to US$107.14/bbl. Rising oil prices and a lower Aussie are not a good sign for Australia's economy either.

Having ticked down by US20c two days in a row, spot iron ore has risen by US40c to US$131.90/t.

The SPI Overnight is up 3 points.

So it's all eyes on the local CPI result today, and that will be followed by HSBC's flash estimate of China's July manufacturing PMI. The Chinese premier managed to appease the world yesterday and provide support for Australian stocks when he dropped his "we can live with lower growth while reforms are more important" stance and instead declared that 7.0% GDP growth is "the bottom line" and that "this bottom line must not be crossed". Analysts had suspected sub-7 might be a line too far for Beijing, and this appears to be the case.

The eurozone will also release a flash PMI tonight, as will the US. US earnings highlights tonight include Dow components Boeing, Caterpillar and Ford, while Visa will also be closely watched and plenty of attention will centre on Facebook.

Locally, Australand Property ((ALZ)) will jump the gun and issue its half-year result today.

Rudi will appear on Sky Business this evening at 5.30pm.