GLOBAL MARKETS-Weak China data pauses Fed-inspired rally in stocks

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Indian and German Markets Led Asian and European Market Gains Asian indexes trading on a strong positive bias Critical Asian indexes were trading on a positive bias on March 1, 2016. The markets followed the positive sentiment that was evident in the Latin American market on the previous day. For more information on how Latin American markets fared yesterday, please refer to Latin American Markets Trade Positively . The rise was primarily attributed to three factors. The first reason was action taken by the People’s Bank of China in decreasing the reserve ratio requirement in order to stabilize the capital markets. The other major reasons include the rise in crude oil prices (USO) and the expectations of an interest rate cut by the Reserve Bank of India. The major Indian (INDA) index Nifty 50 was the leader among the rise in the Asian markets, as it rose by a significant 3.4%. Chinese data release The Chinese PMI (purchasing managers’ index) came out on a negative note on March 1, 2016. The NBS manufacturing PMI continued to deteriorate, falling to 49.0. The non-manufacturing PMI came out at 52.7, which was also below the previous month’s 53.5. The Caixin manufacturing PMI released at 48.0 against the previous month’s 48.4. Even in the midst of the weak data release, the Chinese markets did well. This was mostly attributed to the 0.5% cut in the reserve requirement ratio, which was announced by the People’s Bank of China on February 29, 2016. The Shanghai Shenzhen CSI 300 rose by 1.9%. This is expected to have a major impact on China (FXI) and the other major emerging markets (EEM). Japanese data release on a mixed note The Statistics Bureau of Japan (EWJ) published the year-over-year house holding spending at -3.1%, which was a slight improvement from the previous month’s fall of 4.4%. The unemployment rate came out at 3.2%, down slightly from the previous month’s 3.3%. Among other data, capital spending rose by 8.5%, which was slower than the previous month’s rise of 11.2%. Continue to Next Part Browse this series on Market Realist: Part 2 - Dax Leading the Gains in the European Indexes Part 3 - Australian Dollar Driven by the Domestic Data Release View comments
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