ECONOMIC DATA

- (RU) Russia Feb Manufacturing PMI 40.6 v 34.4 prior

- (SW) Swedish Feb Swedbank PMI: 33.9 v 33.0e

- (IR) Ireland Feb Manufacturing PMI 32.2 v 38.9 prior

- (HU) Hungary Feb Manufacturing PMI 39.7 v 38.5 prior

- (HU) Hungary Jan Producer Prices M/M: 3.0% v -0.9% prior; Y/Y: 5.3% v 5.5%e

- (TU) Turkey Feb Manufacturing PMI 34.2 v 32.9 prior

- (SP) Spain Feb Manufacturing PMI: 31.8 v 31.5 prior

- (SZ) Swiss Feb SVME Purchasing manager Index: 32.6 v 34.8e; lowest reading on record

- (HK) Hong Kong Jan Retail Sales Value Y/Y: 7.4% v 1.2%e; Volume Y/Y: 5.4% v 0.1%e

- (CZ) Feb Manufacturing PMI: 32.6 v 31.5 prior

- (IT) Feb PMI Manufacturing: 35.0 v 35.3e

- (FR) French Feb Final PMI Manufacturing: 34.8 v 35.4e

- (GE) German Feb Final PMI Manufacturing: 32.1 v 32.2e

- (EU) Euro-Zone Feb Final PMI Manufacturing: 33.5 v 33.6e; lowest reading on record

- (NO) Norway Jan Retail Sales Volume M/M: 1.1% v -0.5%e; Y/Y: 0.6% v 0.3%e

- (SW) Swedish Dec Wages Non-Manual Workers: 3.9% v 4.1% prior

- (PD) Polish Q4 GDP: 2.9% v 2.8%e

- (UK) Feb PMI Manufacturing: 34.7 v 35.0e

- (UK) Jan Net Consumer Credit: £0.4B v £0.5Be; Net Lending: £0.7B v £1.5Be

- (UK) Jan Final M4 Money Supply M/M: 2.5% v 2.5% prior; Y/Y: 17.5% v 17.5% prior, Highest annual rate since April 1990

- (UK) Jan Mortgage Approvals: 31K v 33Ke

- (SA) South Africa Q4 Unemployment: 21.9% v 23.2% prior

- (IT) Feb Preliminary CPI (NIC Incl Tobacco) M/M: 0.2% v 0.1%e; Y/Y: 1.6% v 1.5%e

- (IT) Feb Preliminary CPI EU Harmonized) M/M: 0.2% v 0.1%e; Y/Y: 1.5% v 1.4%e

- (EU) Feb Euro-Zone CPI Estimate Y/Y: 1.2% v 1.0%e


SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

- In equities, HSBC [HSBA.UK] reported a 2008 pretax profit of $19.9B, ahead of the $18.0B consensus forecast on an ex items basis. The bank's net interest income came in at $42.56B, up 13% y/y. Its tier 1 capital ratio was 8.3%. Loan impairment charges and other credit risk provisions were $24.9B, compared to $17.20B y/y. The firm proposed a 12 for 5 rights issue at 254p/shr to raise €12.5B. HSBC also said it would close most of its HFC business in North America, affecting 5-6K positions (1.5% of total workforce). || Allied Irish Bank [ALBK.UK] reported a preliminary 2008 net profit of €885M, beating estimates. The bank's 2008 Irish operations sustained a loss of €52M. || Vivendi [VIV.FR] reported a Q4 adjusted profit of €656M, a bit ahead of estimates. Revenues were €7.62B, slightly below expectations. For the fiscal year, Vivendi's net adjusted profit €2.74B just below consensus of €2.78B, with revenues at €25.39B, missng the estimates by a hair. It also said it would propose a 2008 dividend of €1.4/shr. Vivendi's CEO sees strong growth in adj EBIT for FY09. || Ipsen [IPN.FR] reported a 2008 net profit of €147.2M, in line with estimates, while operating profit came in at €180.1M, below forecasts. Revenues were €1.04B, slightly better than the expectations of €1.02B. Company warned its Groups 2009 sales would be adversely impacted depending on the magnitude and the length of the difficulties encountered in these Eastern European countries, which represented approximately 10% of its consolidated sales and approximately 20% if its growth in 2008. || Ahold [AH.NV] reported a Q4 net of €285M, above €230M estimates. Revenues were €6.6B compared to €6.5B forecasts. || Pearson [PSON.UK] reported a preliminary FY08 net of £292M, well below the £431.8M consensus, while revenues were £4.81B, slightly above forecasts. The firm raised its dividend by 7% to 33.8p/shr. || Segro [SGRO.UK] confirmed that discussions are being held about a possible equity capital raise. || Amlin [AML.UK] reportd a 2008 pretax profit of £121.6M, below forecasts of £129.9M. || Wacker Neuson [WAC.GE] reported a 2008 EBITDA of €100M and revenues of €870.3M, both in line with consensus forecasts. The company noted that it remains committed to its long-term growth strategy and was in secure financial position but remained very cautious about business developments in 2009, noting that it would not provide a forecast for the year. || Telekom Austria [TKA.AS] confirmed that CEO Boris Nemsic would resign by the end of March and join Vimpelcom as CEO. || Porsche [PAH3.GE] stated that in the first half of 2009 revenue would be around €3.04B, down 12.% y/y. Deliveries came in at 34.3K units, down 27% y/y.

- In speakers, the EU's Almunia said that the rising wave of protectionist sentiment is worrisome, insisting that more EU nations should join the Euro Zone. || The EU's Barroso commented that a strong, single market was the way to escape the economic crisis and reiterated that the euro provides safety amid the global crisis. || French Finance Minister Lagarde lowered France's 2009 GDP view to -1.5%, noting that the 2009 deficit to GDP ratio would be around 5.0%. || The Russian Finance Minister said that Russia's recession would track the path of US closely. He added that rapid appreciation of the ruble looks unlikely, as does any quick replenishing of reserves. || South Korea's Kim commented there were no concerns regarding South Korea's external debt but that the govt was monitoring external conditions. || OECD's Gurria stated that there was additional room to cut rates in Latin America countires citing low inflationary environment.

- In currencies, risk aversion helped to keep the greenback firmer from closing levels seen on Friday. Concerns remain abotu Eastern European after the EU's disappointing weekend summit, which failed to provide any concerted support for region. Dealers pondering if the pre-Asian market lows in EUR/USD are "rock solid support" that could last throughout the remainder of the week, into US payroll data on Friday. The overall theme for the euro during this morning has been the lack of any impetus to make a significant test of the downside. Dealer chatter regarding decent option related support is providing a floor in place and renewed talk of large size 1.2500 barriers. The GBP/USD was steady during the European morning around the 1.42 area. The Shadow MPC voted in favor of a steady 1.00% repo rate at the upcoming BoE rate decision this Thursday. The market consensus is for the BoE to cut by another 50bps to bring its key rate to 0.5%. || The JPY was little changed during the morning. Japanese press noted that the issue of JPY weakness could spark disputes with US and manufacturers. One article noted that this might come to an end by the end of the financial year on March 31. || CHF currency weaker after its soft Manufacturing PMI data.
USD/CHF was at 1.1750 and EUR/CHF at 1.4805. || Commodity currencies were softer as concerns that the global recession was worsening prompting a realignment in CAD and AUD related pairs. .

- In fixed income, steepening gains are holding during the morning session as US treasuries futures remained at highs from the electronic session, set against a backdrop of global equity weakness and jitters in credit markets.

- In energy, Algerian Oil Minister Khelil commented that a possible announcement of additional OPEC cuts was possible at the March 15 meeting. || Over the weekend, Iran's Oil Minister stated that OPEC was likely to maintain oil output at the meeting. || Iraq is looking to increase its oil output by 500K bpd over the next two year. Iraq's southern oil output was down roughly 250K bpd since the middle of last year. || The Russian energy min Feb Oil output was 9.72M bpd, down 0.7% y/ || Rosneft [ROSN.RU] Reported FY08 proven oil reserves at 22.3B boe, gas at 27.7B boe, Oil reserve replacement rate +172%.

- In credit crisis news, a Commerzbank analyst note observed that the mounting risks made the EUR a precarious place to invest. The report noted that the weekend decision by the EU's not to go for a coordinated bailout of Eastern Europe put the Euro at risk in several ways, including the threat to EMU countries themselves. "Their collapse would be a disaster for the European currency


NOTES

- Asian and European equity markets were sharply lower in the session. News that AIG would need $30B more in bail-out funds rattling through the global financial sector. Thus the contagion sending bank spreads wider in the European morning. HSBC rights issue also sending jitters through the marmets.

- EU Crisis meeting over the weekend agreed to avoid protectionism but rejected Hungary PM's call for EU aid package for Eastern Europe.

- Looking Ahead: Winter storm hitting US Northeast could dampen market liquidity on Monday.

- 8:30 (BR) Brazil Feb PMI Manufacturing: No estimate v 38.1 prior

- 8:30 (CA) Canada Dec Gross Domestic Product M/M: -0.7% expected v -0.7% prior; GDP Annualized: -3.6% expected v 1.3% prior

- 8:30 (US) Jan Personal Income” -0.2% expected v -0.2% prior; Personal Spending: 0.45 expected v -1.0% prior

- 8:30 (US) Jan PCE Core M/M: 0.1% expected v 0.0% prior; Y/Y: 1.6% expected v 1.7% prior; PCE Deflator Y/Y: 0.55 expected v 0.6% prior

- 9:00 (BR) Feb Brazil Trade Balance: $1.10B expected v -$518M prior

- 10:00 (US) Feb ISM Manufacturing: 34.0 expected v 35.6 prior; Prices Paid: 33.5 expected v 29.0 prior

- 10:00 (US) Jan Construction Spending M/M: -1.5% expected v -1.4% prior