Natalya Malykh, Leading Analyst, Global Markets (Finam) On Thursday, March 22, key Asian trading floors ended largely in negative territory on news the Chinese industry contracted at a faster pace in March than the previous month. HSBC’s Manufacturing Activity Index declined to 48.1 in March from the previous 49.6. However, the market saw no aggressive sell-offs and the Chinese benchmarks closed the session with mild losses as the news fuelled speculation that China could possibly relax its monetary policy. China’s CSI 300 index slipped 0.16% to end at 2,583.75. Meanwhile, Hong Kong’s Hang Seng index rose 0.22% to 20,901.56 on the back of a rally in the consumer sector, sparked off by a China Ministry of Commerce report referring to consumption rather than investments as the main engine of economic growth in 2012. In the upshot, the likes of Hengan International Group, Belle International and Tencent Holdings added about 3% on the news. Of the other key economic data, we’d like to highlight Japan’s trade balance data. In February, a decline in exports slowed considerably, while import growth exceeded economist estimates and quite unexpectedly, Japan posted a trade surplus of JPY 32.9 bn. By the closing bell, Japan’s Topix index climbed 0.38% and Nikkei 225 advanced 0.4% to close at 10,127.08. The outperformers included auto manufacturers Nissan Motor, Honda Motor and Suzuki Motor, which ended the day with mild gains, varying in the range of 1.32% to 1.71%. Companies having close business ties with China underperformed. Notably, building equipment manufacturers Komatsu and Hitachi Construction Machinery sank 1.44% and 1.73%, respectively, whereas industrial equipment producer Fanuc finished 1.24% lower. Steel companies Nippon Steel and Tokyo Steel Manufacturing shed 1.28% and 2.21%, accordingly. Toy manufacturer Sanrio bolted up 5.95% after management raised the outlook for annual dividends by 25%, citing robust sales volumes, especially in the USA. The Australian equity benchmark S&P/ASX 200 rose 0.93% to 4,287.18, in large part thanks to bullishness in the banking sector. The shares of lending heavyweights, Australia and New Zealand Banking Group, Westpac Banking and National Australia Bank, gained an average 1%. Commodities plays saw mixed trends, as the news about industrial contraction in China was partly offset by ongoing weakening of the Australian dollar against the USD. Metal companies Iluka Resources and Newcrest Mining edged up 0.87% and 2.02, respectively, while Rio Tinto and Oz Minerals landed in negative territory, losing 1.03% and 0.81%, respectively. The regional stock index MSCI Asia Apex 50 advanced 0.28% before closing at 844.86. By 6.45 pm GMT, Brent oil futures were 0.88% lower at USD 123.11/bbl. Gold was 0.88% down at USD 1,635.80/oz. At the same time, the US dollar index was 0.23% higher at 79.84. Index Country Value Change Change, % YTD, % S&P/ASX 200 Australia 4273,68 19,43 0,46% 4,83% All Ordinaries Australia 4364,88 17,89 0,41% 6,17% Ho Chi Minh Vietnam 445,67 -0,1 -0,02% 26,77% Hang Seng Hong Kong 20901,56 44,93 0,22% 13,38% Hang Seng H-shares Hong Kong 10767,49 -8,51 -0,08% 8,36% BSE 30 (Sensex) India 17196,47 -405,24 -2,30% 11,27% Jakarta Composite Indonesia 4041,56 5,33 0,13% 5,74% Shanghai A-shares China 2488,45 -2,49 -0,10% 8,00% CSI 300 China 2583,75 -4,05 -0,16% 10,15% KLSE Composite Malaysia 1583,24 0,71 0,04% 3,43% NZSE 50 New Zealand 3474,65 -7,3 -0,21% 6,11% Karachi 100 Pakistan 13273,36 -19,76 -0,15% 17,32% Straits Times Singapore 2979,25 -26,38 -0,88% 12,58% Bangkok SET Thailand 839,22 -12,92 -1,52% 16,82% TAIEX Taiwan 8059,94 78 0,98% 13,97% PSEi Philippines 5043,52 5,58 0,11% 15,36% Colombo All-Shares Sri Lanka 5349,7 -34,4 -0,64% -11,93% KOSPI South Korea 2026,12 -1,11 -0,05% 10,98% Nikkei 225 Japan 10127,08 40,59 0,40% 19,77% Topix Japan 862,07 3,29 0,38% 18,32%