Following a light morning of earnings and economic releases, the major equity indices managed to relax after recent geopolitical actions and trade higher. In fact, markets all over the world got a nice recovery today following reports of Russian warplanes ending drills in Ukraine – a small sign that tensions may be subsiding. In Europe, all stock exchanges (but Portugal’s) closed roughly 1.0% higher for the session. In a day light with economic news flow, we look to the status of international markets.

In particular, Chinese stocks are soaring today after it was announced that the rate of inflation in China remained at a steady pace in July. The Chinese consumer price index (CPI) climbed by 2.3% in July, while producer prices fell by 0.9% - both measurements were in-line with economist expectations. Ultimately, the limited price pressure means that China’s central bank will retain enough room to manipulate monetary policy, while the decline in producer prices suggests that the industrial sector might be improving. For all of fiscal 2014, the Chinese government has set an inflation goal of around 3.5%.

Within the report, it was noted that the politically sensitive food prices eased to 3.6%, from 3.7% in June, while non-food prices grew 1.6% after gaining 1.7% in June. Among food prices, the highest increases came from the cost of fresh fruit (20.1%) and eggs (19.5%). Prices of pork declined 3.6% from a 2.7% drop last month – it is likely that the supply of pork is still relatively high in the country. Housing prices were up 2.0%, rental and utilities costs increased 2.8% and 1.1% respectively.