China PMIs Firm, Stocks Climb

Market Snapshot

Asset	Level	Change
Shanghai Composite	3,944.83	+1.36%
CSI 300	4,517.52	+1.52%
Hang Seng	24,788.14	+0.15%
TAIEX	31,722.99	-2.45%
USD/CNY	6.87	-0.58%
USD/HKD	7.84	-0.02%
Copper	5.62	+0.54%
Brent Crude	100.30	-15.25%
Gold	4,784.60	+2.95%
Bitcoin	68,339.59	+0.16%
China 2Y Govt Yield	-	-
China 10Y Govt Yield	-	-

Prior Economic Events

Data	Prior	Cons	Actual
NBS Manufacturing PMI	49	50.10	50.40
NBS Non-Manufacturing PMI	49.50	49.90	50.10
RatingDog Manufacturing PMI	52.10	51.60	50.80

Today's Economic Events

Data	Prior	Cons	Time
RatingDog Services PMI	56.70	53.70	21:45

Mainland China's NBS Manufacturing PMI rose to 50.4 in March, beating consensus of 50.1, signaling expansion amid recovering factory activity.
RatingDog Manufacturing PMI eased to 50.8, missing expectations of 51.6, while non-manufacturing gauges showed modest gains.
Equities advanced in mainland China and Hong Kong, buoyed by PMI data, though Taiwan's TAIEX declined on tech sector volatility.

Yesterday's Recap

Mainland China's NBS Manufacturing PMI for March climbed to 50.4 from 49.0, surpassing consensus of 50.1 and marking the first expansion in six months, driven by stronger new orders and production amid policy support. The NBS Non-Manufacturing PMI edged up to 50.1 from 49.5, slightly above expectations of 49.9, reflecting resilience in services despite property sector headwinds. RatingDog Manufacturing PMI dipped to 50.8 from 52.1, below consensus of 51.6, highlighting subdued export demand due to global trade tensions.

Mainland equities rallied on the PMI beats, with the Shanghai Composite closing at 3,944.83 for a 1.36% gain and the CSI 300 at 4,517.52 up 1.52%, led by industrials and materials amid copper price rises. Hong Kong's Hang Seng index inched up 0.15% to 24,788.14, supported by retail sales growth of nearly 12% in the first two months of 2026, though property supply concerns lingered. Taiwan's TAIEX fell 2.45% to 31,722.99, pressured by semiconductor export uncertainties linked to global supply chain disruptions from the Iran conflict.

Currency markets saw USD/CNY weaken 0.58% to 6.87, reflecting PBoC stabilization efforts, while USD/HKD held steady at 7.84 with a minor 0.02% dip.

The Day Ahead

Attention turns to mainland China's RatingDog Services PMI for March, due at 21:45 ET, with consensus expecting a decline to 53.7 from February's 56.7, potentially signaling cooling in the services sector amid economic slowdown. No major data releases are scheduled for Hong Kong or Taiwan, allowing markets to digest recent PMI figures and global oil volatility. Investors will monitor any State Council signals on property sector redesign, as news highlights ambitions to shift away from real estate dependency.

Cross-strait trade flows may come into focus with ongoing geopolitical tensions, particularly affecting Taiwan's semiconductor outlook. Broader Greater China sentiment could be influenced by commodity moves, with copper as a key proxy for mainland demand.

Other Economic Notes

Mainland China's push to rebalance trade, as reaffirmed in Qiushi journal, emphasizes moving away from unsustainable export-led growth amid rising global protectionism, potentially boosting domestic consumption and high-tech sectors. (cont...)

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Other Economic Notes (continued)

Hong Kong's premium office supply is set to peak this year, per Cushman, with demand lagging due to economic slowdown, exacerbating vacancy rates and pressuring rents. Taiwan's semiconductor industry faces headwinds from global supply chain chokepoints, including critical minerals and jet fuel shortages linked to China's export cuts.

Global Macro News

Global markets rallied on signals from US President Trump that attacks on Iran could cease within weeks, potentially reopening the Strait of Hormuz and easing oil supply disruptions, with Brent crude dropping 15.25% to $100.30 amid reduced war premiums. This development weighs on Greater China's import costs, particularly for energy-dependent industries in mainland China and Taiwan, where jet fuel shortages have hit airlines and logistics. Economists are raising US recession risks due to ongoing Iran war impacts on supply chains, which could dampen export demand for Greater China's manufacturing hubs.

China's state insurer is capitalizing on Brazil's credit crisis to expand exports, turning high interest rates into financing advantages for importers. Japan and France's roadmap for critical minerals supply aims to diversify away from China dominance, potentially affecting Taiwan's semiconductor raw material access and mainland rare earth exports. The global economy's chokepoints highlight trade-offs between resilience and efficiency, with excessive dependence on single sources like China's jet fuel exports creating vulnerabilities for Asia-Pacific partners.

Gold surged 2.95% to $4,784.60 as a safe-haven amid geopolitical uncertainty, benefiting Greater China's commodity-linked assets. Bitcoin held steady at $68,339.59 with a 0.16% gain, reflecting mixed risk sentiment.

Greater China Central Banks Watch

The People's Bank of China (PBoC) is expected to maintain key lending rates steady for the tenth month, as Mideast tensions cloud the inflation outlook despite China's CPI YoY at -0.10%, with focus on liquidity operations to support recovery without fueling property bubbles. PBoC signals include expanding digital yuan access to more banks, aiming to integrate it into the real economy since its 2019 launch, potentially enhancing cross-border payments with Hong Kong. The Hong Kong Monetary Authority (HKMA) continues to manage USD/HKD peg dynamics, with the pair stable at 7.84 amid thin aggregate balance fluctuations and rising fuel prices prompting reviews of fire safety laws for illegal sales.

Taiwan's Central Bank of the Republic of China (CBC) remains vigilant on FX interventions to counter TWD volatility from semiconductor export outlooks, linked to global tech demand and supply chain risks from the Iran war. Across Greater China, central banks are navigating trade rebalancing pushes, with PBoC eyeing RRR adjustments if PMI momentum fades, while HKMA supports investment flows via sovereign fund integrations. (cont...)

Greater China Macro Daily(Beta Mode)