Economic Data
(CN) CHINA MAR HSBC FLASH MANUFACTURING PMI: 48.1 V 49.7 PRIOR (5th consecutive contraction, 4-month low, first decline in 4 months)
(JP) JAPAN FEB MERCHANDISE TRADE BALANCE TOTAL: +¥32.9B V -¥120BE (first surplus in 5-months); ADJUSTED TRADE BALANCE: -¥313B V -¥343BE (5-month high)
(NZ) NEW ZEALAND Q4 GDP Q/Q: 0.3% V 0.6%E; Y/Y: 1.8% V 2.2%E; 2011 GDP: 1.4% v 1.6%e
(JP) JAPAN FEB NATIONWIDE SUPERMARKET SALES Y/Y: 0.3% V -1.2% PRIOR
(CO) COLOMBIA JAN INDUSTRIAL PRODUCTION Y/Y: 2.4% V 4.0%E; RETAIL SALES Y/Y: 4.9% V 7.0%E
Markets Snapshot (as of 04:30GMT)
Nikkei225 -0.1%
S&P/ASX +0.5%
Kospi -0.2%
Taiwan Taiex +0.8%
Singapore Straits Times -0.3%
Shanghai Composite -0.4%
Hang Seng unchanged
S&P Futures -0.1% at 1,396
April gold -0.1% at $1,649/oz
May Crude -0.6% at $106.63
Overview/Top Headlines
Markets were mixed to today, with dollar weakness against the major currencies. Opening gains were pared back after HSBC flash manufacturing PMI for China came in at 48.1, this was the 5th consecutive contraction and a 4-month low. There was some chatter ahead of time that the reading could be over 50. New exports also declined from the final reading in February to 46.2. Initially the AUD/USD fell over 60 pips to $1.0415 (2-month low). The Shanghai Composite also fell, however three hours later it returned to positive territory gaining over 0.3%. Overnight the PBoC cut the required reserve ratio (RRR) for more outlets of Agricultural Bank of China to encourage lending in rural areas, effective from March 25. The preferential policy which originally covered 563 county-level outlets in 8 provinces now covers another 379 outlets in 4 provinces. So far 565 outlets have qualified for the lower RRR ratio, a move that could free about CNY23B in lending for these areas. Yen got a boost after a surprise trade surplus in Japan for February. USD/JPY fell below ¥83.20 on the news. This was the first surplus in 5 months, the Japan adjusted merchandise trade balance came in at a 5 month high at a deficit of ¥313B. Exports to China declined for the 6th consecutive month, while exports to the US saw their largest increase since Dec 2010. The NZ$ fell 40 pips after Q4 GDP data, private spending increased 0.8%, while government spending fell 0.7% q/q. Analysts from ANZ still expect for the RBNZ to start tightening policy in December despite the soft Q4 GDP data, but economic momentum needs to pick up in H2. Silver and copper reversed yesterday's gains falling 0.4% and 0.9% respectively. Wheat and corn continued their gains up 0.3% and 0.4% respectively.
Speakers/Geopolitical/In the press
(AU) Reserve Bank of Australia (RBA) signs CNY200B bilateral currency swap agreement with China's PBoC worth up to A$30B over initial 3-year period
(JP) Japan Govt official: Finished prelim talks with China and South Korea on 3-way investment pact
(KR) South Korea Fin Min Bahk: Economy could hit its bottom in Q1
(JP) BoJ Morimoto: Liquidity concerns regarding Europe has declined, though debt crisis continue to be risks to Japan and global economy
(EU) ECB Pres Draghi: LTRO will not fuel inflation; Will take preventative steps if inflation outlook deteriorates
(AU) RBA Assist Gov Debelle: Competition for deposits is the main driver of higher funding costs for banks
(CN) China State Council Development Center Researcher Yu Bin: Expects 2012 GDP to be 8.5%; Expects narrow trade surplus this year
Equities
Wharf, 4.HK: Reports FY11 Underlying profit HK$8.1B v HK$7.9Be, Rev HK$24B, +24% y/y
VAH.AU: Australian Competition and Consumer Commission expected to announce it will approve alliance between Virgin and Skywest - Australian press
BSL.AU: Will seperate the company into two units that will focus on global pre-engineered building market and the building products market
SIP.AU: Reports FY11 Net A$49.2M v A$51Me; Declares special dividend of A$0.015
US Equities
GM: Australia govt has give a A$275M assistance package to GM's Aussie unit to guarantee is will continue to make autos in the country - Australian press; +0.1% after hours
DFS: Reports Q4 $1.18 v $0.94e, R$1.84B v $1.8Be; -0.8% after hours
DMND: Reaches Forbearance Agreement With Lenders; Suspends $0.045 dividend payment; -1.6% after hours