Shanghai A-shares slightly higher follow PBoC interest rates cut

Asian Mid-session Update: Shanghai A-shares slightly higher follow PBoC interest rates cut; USD/JPY approaching ¥120 handle on Dollar strength

Economic Data

- (CN) CHINA FEB MANUFACTURING PMI: 49.9 V 49.7E; 2nd month of contraction

- (CN) CHINA FEB NON-MANUFACTURING PMI: 53.9 V 53.7 PRIOR

- (CN) CHINA FEB FINAL HSBC MANUFACTURING PMI: 50.7 V 50.1E

- (NZ) NEW ZEALAND Q4 TERMS OF TRADE INDEX Q/Q: -1.9% V -3.0%E

- (AU) AUSTRALIA FEB AIG PERFORMANCE OF MANUFACTURING INDEX: 45.4 V 49.0 PRIOR (3rd month of contraction)

- (AU) AUSTRALIA FEB RPDATA/RISMARK HOUSE PRICE INDEX M/M: 0.3% V 1.3% PRIOR

- (AU) AUSTRALIA FEB TD SECURITIES INFLATION M/M: 0.0% V 0.1% PRIOR; Y/Y: 1.3% V 1.5% PRIOR

- (AU) AUSTRALIA Q4 COMPANY OPERATING PROFIT Q/Q: -0.2% V +0.5%E; INVENTORIES Q/Q: -0.8% V +0.1%E

- (KR) SOUTH KOREA JAN INDUSTRIAL PRODUCTION M/M: -3.7% V 0.4%E; Y/Y: 1.8% V 1.0%E

- (KR) SOUTH KOREA JAN CYCLICAL LEADING INDEX CHANGE: 1.0% V 0.4% PRIOR

- (KR) SOUTH KOREA JAN CURRENT ACCOUNT: $6.9B V $7.0B PRIOR

- (KR) SOUTH KOREA FEB HSBC MANUFACTURING PMI: 51.1 V 51.1 PRIOR

- (JP) JAPAN Q4 CAPITAL SPENDING Y/Y: 2.8% V 4.1%E; CAPITAL SPENDING EX-SOFTWARE Y/Y: 3.9% V 5.0%E

- (TW) Taiwan Jan HSBC Manufacturing PMI: 52.1 v 51.7 prior

- (VN) Vietnam Feb HSBC Manufacturing PMI: 51.7 v 51.5 prior

- (ID) Indonesia Feb HSBC Manufacturing PMI: 47.5 v 48.5 prior (5th consecutive contraction, record low)

Index Snapshot (as of 03:30 GMT)

- Nikkei225 +0.3%, S&P/ASX +0.8%, Kospi +0.2%, Shanghai Composite +0.3%, Hang Seng +0.2%, Mar S&P500 flat at 2,104

Commodities/Fixed Income

- Apr gold +0.6% at $1,221, Apr crude oil -0.1% at $49.40/brl, May Copper -0.1% at $2.69/lb

- USD/CNY: (CN) PBoC sets yuan mid point at 6.1513 v 6.1475 prior setting (weakest Yuan setting since Nov 6th)

- (JP) BOJ offers to buy ¥50B in JGBs with maturity less than 1-yr, ¥240B in 10-25yr JGBs and ¥140B in JGBs with maturity over 25-yr

Market Focal Points/FX

- China central bank PBoC cut interest rates by 25bps over the weekend. Central bank reiterated prudent monetary policy and expressed to create a neutral appropriate monetary and financial environment for economy. PBoC reiterated to be more appropriate on monetary policy, and to use comprehensive monetary tools to fine-tune economy. China also released Feb Manufacturing PMI, slightly better than consensus. Later in the evening, HSBC released China Feb final Manufacturing PMI, revised the final figure much higher to 50.7 from flash reading of 50.1. China think tank State Information Center (SIC) also forecast China Q1 GDP growth at about 7%. Shanghai equity market, despite positive news over the weekend, traded only slightly higher by 0.3% during the morning session. Some security brokers in Shanghai led the gains, including Northeast Securities, Sinolink Securities.

- Japan released its 4th quarter capital spending figure, Y/Y at 2.8%, fell short of 4.1% consensus. USD/JPY little changed after the data, but moved generally higher to just below ¥120 handle during today's session, on overall US Dollar's strength. We also saw a slightly better Markit/JMMA Manufacturing final PMI data of 51.6 than flash reading of 51.5, which marked 9th consecutive expansion for Japan.

Equities

US markets:

- NXPI: NXP and Freescale confirms $40 Billion Merger

- BRK.B: Reports Q4 $2,529 v $2,555e; Found the "right person" as successor to Warren Buffett when he decides to step down

- SAIC: To acquire Scitor Corporation for $790M

- LL: 60 Minutes report says Lumber Liquidators laminate flooring made in China does not meet California health and safety standards, contains unsafe levels of formaldehyde

Notable movers by sector:

- Consumer Discretionary: Myer Holdings Ltd MYR.AU -11.1% (names new CEO); Seven West Media SWM.AU +6.1% (jv receives regulator approval)

- Financials: CITIC Securities 600030.CN +1.6%, Poly Real Estate 600048.CN +0.7% (PBoC cuts interest rates)

- Materials: Mirabela MBN.AU -21.2% (FY14 results); Kingsgate KCN.AU -3.2% (H1 results); Sirius Resources SIR.AU -7.2% (issues exploration update)

- Energy: Xinyi Solar 968.HK +0.9% (FY14 results)

- Industrials: Kawasaki Kisen Kaisha 9107.JP -1.1% (FY19 target); Orica ORI.AU +3.1% (announces shares buyback); Dah Chong Hong Holdings 1828.HK -8.6% (FY14 results)