Overnight, we had two reports showing that the Euro-zone economy - and especially Germany - posting strong levels of activity in manufacturing and services.

We had the preliminary readings come out for January in both of those sectors. The manufacturing PMI for the Euro-zone came in at 56.9, a bit lower 57.1 reading we had in December, but it still shows modestly strong growth in activity. The surprise was a jump in the Euro-zone services PMI to 55.2 from December's 54.2. It was therefore the services sector that helped push the Composite Output Index - a combination of both manufacturing and services - to a six-month high.

The Markit Flash Eurozone Composite Output Index, based on around 85% of usual monthly replies, rose from 55.5 in December to a six-month high of 56.3 in January.

Growth was again led by Germany, where the rate of expansion rose to a rate exceeded only once (in June 2006) in the survey's 13-year history and was well above the Eurozone average. Output growth also picked up in France, which posted the strongest gain for four months and a rate of expansion marginally above the Eurozone average. Outside of these two core countries, however, output growth remained close to stagnation, with the rate of increase only slightly above December's 13-month low.

Growth accelerated in both manufacturing and services, with the former seeing the stronger rate of increase (as has been the case in all but one period of the 18-month recovery). Manufacturers saw the largest rise in output for six months. Meanwhile, services saw activity growth recover to a pace just below November's three-month high, and only one index point lower than last May's post-recession peak, in part reflecting a bounce-back from weather related disruptions in December.

Germany led the gains as its services sector PMI climbed to 60.0 in January from 59.2 in December.

Germany started the year with another steep increase in business activity, and the latest Flash PMI data highlight a broadening of the recovery from the manufacturing to the service sector. The seasonally adjusted Markit Flash Germany Composite Output Index rose from 60.3 to 61.0 in January, to signal the strongest private sector growth since the record-high posted in June 2006.

The sharp expansion of private sector output was supported by the fastest rise in business activity at service providers since June 2006. Higher levels of service sector activity have now been recorded for a year-and-a-half. A number of survey respondents noted that improved domestic economic conditions had boosted demand and encouraged clients to commit to new spending.

This contributed to a surge in optimism about the outlook for the 12 months ahead, with five times as many service providers forecasting an increase in business activity (40%) as those anticipating a decline (8%). The resulting business expectations index was the highest since December 2003.

In a second report we had industrial new orders for the month of November rise 2.1% from a 1.3% rise  in October. Here, Germany led the way and it shows that new orders picked up in the middle of the 4th quarter.

What today's data tells us is that if Euro-zone politicians can come together to put a lid on the sovereign debt crisis, then there may be some positive fundamental macro-economic data in the Euro-zone that could help support the Euro currency.

In today's trading, we had the Euro decline a bit, probably a correction to the strong gains we finished up with to end last week. There are no US fundamentals today, so let's keep an eye on technical factors and how equities open this week.