PMI figures, China, Japan, Australia, PMI for manufacturing

India’s manufacturing PMI for February came in at 55.3, according to a private survey by S&P Global.

This was slightly lower than January’s figure of 55.4, but it beat economists’ expectations for a PMI reading of 54.3.

A PMI reading above 50 indicates expansion in the sector, while a reading below 50 signals contraction.

On Tuesday, India released its gross domestic product figures for the period October-December 2022, which saw an increase of 4.4% compared to 5.2% in the same period a year ago.

India’s government still maintains an estimate of 7% GDP growth for the fiscal year ending March 31, 2023, expected to surpass China’s 2022 figure of 3%.

– Lim Hui Jie

The Reserve Bank of Australia is likely to raise interest rates one more time at its March meeting before pausing for the rest of the year, AMP said in a note.

“We believe the RBA is closer to pausing the rate hike cycle than the market expects,” AMP senior economist Diana Mousina said in a note.

“We only expect one more rate hike from the Reserve Bank at the March meeting and a pause for the rest of the year (with the risk of a rate cut later in 2023),” she said, citing the “disappointing” economic performance. data seen in the previous months,

Mousina pointed to negative job growth between November and December, a smaller-than-expected wage increase in the last quarter of last year, and how monthly consumer prices show signs of slowing in early 2023.

She added a weaker employment printout in February would increase the risk of a pause at the RBA’s March meeting. Australia will release unemployment figures for February on March 16, after seeing a 0.2 percentage point rise in unemployment in February.

The Australian dollar was down 0.31% against the US dollar on Wednesday, trading at 0.6573.

— Lim Hui Jie

Technology and consumers linked to reopening led to gains in Hong Kong during Wednesday’s morning trade.

Tencent gained 5.53%, NetEase gained 6.94% and Alibaba rose 4.74%.

EV makers also saw gains, with Xpeng rising 8.73%, Li Auto jumping 7.32% and Baidu rising 5.56%.

Reopening-related consumer names also rose, with Budweiser Brewing Company up 6.38%, Anta Sports gaining 5% and Li Ning up 4.64%.

China’s official manufacturing purchasing managers’ index rose to 52.6 in February, above the 50-point mark that separates growth from contraction, data from the National Bureau of Statistics showed.

That compared with January’s reading of 50.1 and above expectations of 50.5, according to economists polled by Reuters.

The non-manufacturing PMI rose to 56.3 – also above January’s reading of 54.4, the highest level since June 2022.

– Jihye Lee

Japan’s factory activity slowed at the fastest pace in two and a half years in February, a private survey by au Jibun Bank showed.

The purchasing managers’ index in industry fell to 47.7, down from 48.9 in January. This also marked the fourth consecutive month that Japan’s factory activity has remained in contraction territory.

A PMI reading above 50 indicates expansion, while a reading below 50 signals a slowdown in growth.

On Tuesday, Japan’s industrial production fell 4.6% from a month ago in January, the biggest decline the economy has seen in eight months.

— Lim Hui Jie

Australia’s economy grew 2.7% for all of 2022, in line with economists’ expectations, but lower than 2021’s figure of 5.9%.

On a quarterly basis, gross domestic product grew 0.5%, according to the country’s statistics agency. Australia has now recorded five consecutive increases in quarterly GDP, but growth slowed for the last two quarters.

The Australian dollar strengthened 0.36% against the US dollar, while the S&P/ASX 200 slipped 0.22% lower.

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— Zavier Ong

South Korea’s trade deficit narrowed to $5.3 billion in February after marking a deficit of $12.65 billion in January, preliminary data showed.

The latest reading is a narrower deficit than expected to see a deficit of $6.06 billion, according to economists polled by Reuters.

Exports fell by 7.5%, falling less than expectations for an 8.7% decline – while imports grew by 3.6%.

– Jihye Lee

March is usually a positive month for the stock market, but this year it could bring more of the same turbulence that rattled investors in February.

Stocks are set to exit February with steep losses, with the S&P 500 down 2.3% for the month through Monday. The index is still up 3.7% for the year so far.

“February is the second worst month of the year, with an average decline of 0.21%, which is the second worst after September,” said Sam Stovall, investment strategist at CFRA. “But on average, March makes a 1.1% gain, and is up 64% of the time.” March is the fifth-best month for the S&P 500, according to CFRA data going back to 1945.

For more, read the full story on CNBC Pro.

— Patti Domm, Tanaya Macheel

The yield on the 10-year U.S. Treasury note hit a high of 3.983% on Tuesday, the highest level since Nov. 10, when the note yielded as high as 4.117%. It was last higher by about 3 basis points at 3.955.

Treasury yields contributed to the sharp gains in February as traders continued to weigh the prospect of tighter monetary policy longer than expected.

— Gina Francolla, Tanaya Macheel

The US central bank’s rate hikes have weighed on equity markets, according to UBS Financial Services.

“We consider the economy to be late in the cycle, with the Fed continuing to raise interest rates and growth likely to slow. Tighter policy creates downside risks for markets,” UBS senior US economist Brian Rose wrote in a note to clients on Monday.

The firm expects the S&P 500 to end the year near current levels, with better upside potential in cyclical markets outside the US, particularly in emerging markets and Germany.

“We prefer value over growth,” Rose wrote.

According to Rose, financial conditions have not tightened in step with the Fed’s interest rate hikes. The Fed raised interest rates by 25 basis points on February 1, hinting that there will be further rate increases in the months ahead.

—Pia Singh