China and Japan fuel economic optimism as France declares recession over

Chinese premier Li Keqiang, who pledged today to keep GDP growth at 7% or higher. Photograph: Ma Zhancheng/Xinhua Press/Corbis

Good morning, and welcome to our rolling coverage of the latest events across the eurozone, the financial markets and the global economy.

We start with encouraging signs from Asia, where bullish talk from Chinese premier Li Keqiang and the Japanese government have sparked a share rally overnight.

Li tried to calm fears that the Chinese economy was stalling, telling businessmen in Shanghai that the country's "bottom line" for economic growth is 7% (it slowed to 7.5% in the last quarter).

The comments came amid local reports that Beijing will drive investments in high-speed railways to help reduce overcapacity in sectors such as cement and steel.

Cue optimism across the region. As Alvin Pattisahusiwa, a director of investment at PT Manulife Aset Manajemen Indonesia, put it:

Li's statement provides assurances for investors that there won't be negative surprises in the country.

That's welcome news in Europe too, where there are fears that China could slide into an economic hole before the eurozone manages to dig itself out of its own predicament.

And with Tokyo's Cabinet Office upgrading its economic outlook for the third month in a row, there's a little more optimism about prospects in the month ahead.

The Cabinet Office declared that the Japanese economy was "steadily picking up", and moving towards a "self-sustainable recovery", adding:

Recent price developments indicate that deflation is easing.

This stream of news sparked a decent rally in Asia, driving markets to a six week high. China's CSI 300 jumped 2.5%, driven by railway company shares, while the Hong Kong Hang Seng is up 3.5%.

And in Europe, traders are joining in - with the main indices all gaining ground (the FTSE 100's up 27 points at 6650.

Otherwise, as you may have already deduced, it's a quiet morning, as Europe slides into its summer lull. I'll be covering all the key developments through the day, though.....

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