Apple’s rise has helped lift technology stocks on Wall Street, pushing the Nasdaq Composite 0.39% higher.

The Dow Jones Industrial Average - which also includes Apple - is marginally higher, up 0.04% while the S&P 500 has opened 0.17% higher.

Here’s IG index on the expected opening for Wall Street:

In pre-trading Apple shares are currently up around 4%, not quite enough so far to push it above a $1tn valuation.

It’s not all good news for Apple despite its upbeat results and its approach towards a $1tn valuation. Samuel Gibbs reports:

Huawei overtook Apple to become the world’s second-largest smartphone seller behind Samsung in the second quarter, the first time in seven years that any contender has managed to split the top two.

Multiple market analysts said that Huawei’s rise came as the slowdown in China, the world’s largest market for smartphones, eased, with growing market share in Europe. Huawei failed in its recent bid to launch in the US after government action against companies deemed a security threat.

Despite Apple being historically weak in the second quarter, analysts described the rise of Huawei as significant.

“The importance of Huawei overtaking Apple this quarter cannot be overstated,” said Canalys analyst Ben Stanton. “It is the first time in seven years that Samsung and Apple have not held the top two positions.”

Our full report is here:

The FTSE 100 has taken a turn for the worse in the course of the morning.

Trade tensions are uppermost in investors’ minds following reports that the US plans to raise the tariffs it plans of $200bn worth of imports from China from the original 10% to 25%. So commodity stocks are among the leading fallers on concerns that any slowdown in China’s economy would hit the sector hard.

Sharp falls in the likes of Next, Direct Line and Rio Tinto after their latest updates is also hitting the market, leaving the UK’s leading index 1% or 77 points lower at 7671.

So is this the day Apple’s market value hits $1tn? All eyes will be on Wall Street’s open to see how the better than expected results are received. Will investors push Apple higher or decide to take profits? Neil Wilson, chief market analyst at Markets.com, says:

Apple shares leapt 4% in after-hours trade and are set to open at a record high just shy of the $200 level. Although it would be a bit of a stretch, a push up to the $1tn mark today is a possibility - it’s only a matter of time before it achieves a valuation of $1tn. If it does, cue some big profit taking but it would be a moment to savour for Tim Cook.

We need the share price to break $203 to hit $1tn in market cap – a little more than $5 above the after-hours level at $197-$198. Rather like the Dow at 25k, you kind of get the feeling investors will conspire to nudge it over the line. If you’re in FAANGs now I don’t see why you wouldn’t rotate some equity out of more exposed companies like Facebook and Netflix and opt for relative safety in Apple, whose multiples remain well short of FAANG peers. What might weigh today is broader market fears about trade wars with China as the White House sets out fresh tariff plans on $200bn of Chinese goods. Tim Cook was pretty circumspect on trade and tariffs on the call.

Results were very impressive with a beat on revenues and EPS. iPhone sales were a shade weaker than forecast but on a number of important fronts we saw excellent numbers.

The FAANGs - Facebook, Amazon, Apple, Netflix and Google-owner Alphabet - and the wider technology sector have been under pressure in recent days after poor results from Facebook and Twitter. But Apple’s figures could give some badly needed support to the sector.

The pound is not getting much help from the prospect of an interest rate rise on Thursday.

Against the dollar it is down 0.05% at $1.3117, while against the euro is has edged up 0.05% to €1.1229.

The survey is positive about exports but less so about domestic demand, says Helena Sans, head of manufacturing at Barclays:

A disappointing result for the manufacturing sector in July with PMI at a three-month low, although still firmly in positive territory. Of more concern is the weakest business confidence score for 21 months, indicating that the industry is desperate for a degree of clarity and progress on the Brexit negotiations and a better understanding of what the final outcome will mean for manufacturers.

It looks like a tale of two markets at the moment, with export growth accelerating but domestic demand struggling to keep pace. Aside from the encouraging news for exporters, the only other real bright spot was more job growth, with two full years of consecutive monthly employment increases no mean feat.

Following the weaker than expected UK manufacturing report, things are unlikely to improve in the immediate future, says ING Bank economist James Smith. But the downbeat survey is unlikely to discourage the Bank of England from raising interest rates on Thursday, he says:

At 54.0, the latest UK manufacturing PMI is the lowest in three months and is a far cry from the levels seen towards the end of 2017. Weaker domestic demand saw new orders fall and the rate of output growth slip to the lowest in 16 months. Interestingly though, demand from abroad hit a six-month high, implying that firms are still reaping the rewards of better global growth, despite the recent moderation in Europe.

But over coming months, life for manufacturers is unlikely to get any easier. The recent escalation in trade tensions is clearly a challenge, but increasingly the biggest headache for businesses is likely to be the threat of a ‘no deal’ Brexit. This scenario would likely see huge congestion at ports and disruption to supply chains. While we suspect the probability of the UK leaving without an agreement in March next year is relatively low, an agreement may not come until late in the day.

Until then, confidence could begin to fall as uncertainty increases – the latest PMI suggests the degree of positive sentiment is already at a 21-month low.

Having said all of that, today’s slip in the PMI is unlikely to faze Bank of England policymakers ahead of tomorrow’s decision. Representing around 10% of output, manufacturing is a relatively small part of the UK growth mix. Importantly, the recent data flow – particularly in the much larger service sector – has largely backed up the Bank’s view that the economy has regained poise after the weak first quarter.

For that reason, we think the Bank of England will increase interest rates this week. But the key thing to watch is what the Bank has to say on its next steps. In an ideal world, we think policymakers would like to hike rates again much sooner than markets are currently pricing (towards the end of 2019). But with Brexit uncertainty considerably ramping up, realistically we think the Bank will struggle to raise rates again before the UK leaves the EU next March.

After Thursday, we currently don’t anticipate another hike before May 2019.

The prospect of a trade war between the US and China is the biggest worry for UK manufacturers, says Dave Atkinson, UK head of manufacturing at Lloyds Bank Commercial Banking:

The dip in the [PMI] reading comes after an eventful month politically. But if manufacturers are not completely ignoring the Brexit uncertainty, they are nevertheless ploughing on regardless.

If anything, the biggest current worry for a sector with so many exporters is the prospect of an all-out trade war between the world’s two largest economies. The fear is that UK manufacturers become collateral damage in any tit-for-tat tariffs that are imposed at a time when firms are benefiting from their exposure to the still relatively buoyant global economy.

The automotive industry is facing a particularly anxious time grappling as it is with weaker consumer sentiment, ambivalence towards diesel engines and uncertainty about those future trade arrangements. This is a real worry given the number of jobs and exports supported by the sector.

But by contrast, UK aerospace enjoyed a good July, boosted by the Farnborough Airshow. Bumper orders for the major aircraft manufacturers will help the small- and medium-sized businesses in their supply chains and the launch of the new Tempest fighter jet has the potential to safeguard thousands of highly-skilled jobs.

The weaker than expected figures could give the Bank of England second thoughts if it really is planning to raise UK interest rates on Thursday, suggests IHS Markit director Rob Dobson:

The financial markets still seem to have an interest rate increase nailed on for August. However, if the combination of weaker growth and a softening of pipeline cost pressures at manufacturers is mirrored in the larger service sector, the Bank of England’s decision will be far from unanimous and they may even yet find some cause for pause.

The figure of 54 for July’s UK manufacturing PMI is a three month low, albeit that any number over 50 shows the sector is expanding. Markit said:

The softer growth patch of the UK manufacturing sector continued at the start of the third quarter. July saw slower rates of expansion in both output and new orders, as weaker growth of new work from domestic sources offset a stronger increase in new export orders. Price pressures also remained elevated as a strong increase in average input costs led to the steepest rise in selling prices since February...

July saw the degree of positive sentiment dip to a 21-month low, amid reports of uncertainty regarding both Brexit and the exchange rate.

Duncan Brock, group director at the Chartered Institute of Procurement & Supply which co-compiles the survey, said:

There was a flatline feel to manufacturing this month, as the sector held its ground, but only just. Overall production slowed, whilst new order growth took a leisurely pace, and it was the unbalanced reliance on export orders that kept the sector afloat with domestic clients keeping their distance.

This general manufacturing malaise was compounded by a scarcity of essential raw materials and vendor delivery times lengthened at a pace not seen for ten months as supply chains stuttered and stumbled to meet contractual obligations.

On the price front, firms raised client prices again in a bid to prevent another sudden increase in their own costs from gnawing away at hard-won profits. But, this strategy may not offer long-term solutions as uncertainty remains enemy no.1. Should operating conditions remain unchanged, this damp squib of a performance may persist and the UK has to look to other sectors to inject some vitality into its economic performance.

Here’s Markit’s country by country manufacturing PMIs for July:

Commenting on the Nationwide house price index, Jonathan Hopper, managing director of Garrington Property Finders, said:

Two steps forward, one step back – Nationwide’s annual rate of price growth has barely shifted from where it was a year ago.

It’s tempting to see such a meandering market as the fruit of a cautious consensus. Instead it’s a byproduct of the collision of three conflicting forces; pent-up demand, low supply and patchy confidence.

With activity levels slowly picking up, the rising tension is creating some big regional anomalies – making the national average as misleading as it is insipid.

The future course of the market is balanced on a knife edge. With the Bank of England set to notch up interest rates tomorrow, the prospect of more expensive mortgages should jolt some previously hesitant buyers into action. Yet any extra impetus is likely to be immediate but ephemeral.

By contrast, the forces holding back the market will get steadily stronger if the UK sleepwalks into a no-deal Brexit.

If the prospect of Britain crashing out of the EU continues its shift from long shot to likely, the top end of the market could slip into full retreat as investment buyers go into lockdown.

For everyone else, softening prices and better affordability will create buying opportunities – particularly for the bold and strategic – in what will become an increasingly fractured market.

Signs of strength in the UK housing market. The Press Association reports:

Annual house price growth accelerated in July as the average property value hit a new record high of £217,010, according to an index.

Across the UK, house prices were up by 2.5% annually in July, compared with a 2% annual increase in June, Nationwide Building Society said.

House prices increased by 0.6% month on month in July - the second month of increases in a row following a 0.7% upturn in June.

With speculation that the Bank of England base rate could edge up on Thursday from 0.5% to 0.75%, Nationwide said a 0.25 percentage point rise is likely to have only a modest immediate impact on borrowers, many of whom are locked into fixed-rate deals.

Robert Gardner, Nationwide’s chief economist, said: “Providing the economy does not weaken further, the impact of a further small rise in interest rates on UK households is likely to be modest. “This is partly because only a relatively small proportion of borrowers will be directly impacted by the change.

“Most lending on personal loans and credit cards is fixed or tends to be unaffected by movements in the bank rate. Similarly, in recent years, the vast majority of new mortgages have been extended on fixed interest rates.”

But, he continued: “While the impact for most borrowers is likely to be modest, it’s important to note that household budgets have been under pressure for some time because wages have not been rising as fast as the cost of living.

“Indeed, in real terms (after adjusting for inflation) wage rates are still at levels prevailing in 2005.”

Mr Gardner said that, overall, Nationwide continues to expect house prices to increase by 1% over the course of 2018.

Here are IG’s opening calls for European markets: