Over the weekend, China announced another surprise easing, cutting interest rates following on from its recent cut to bank reserve requirements. Although the move helped to give stock markets in Hong Kong and Australia a bit of a lift, surprisingly copper did not respond at all to the move. This suggests that with at least some traders the move appears to have raised the question: how weak is China’s economy to force the PBOC to start acting so much more aggressively in the last few months? Stock markets in Europe and North America are mixed to start the month with indices in Europe trading lower and US indices trying to decide whether to open in the green or not. UK manufacturing PMI soundly beat the street again along with Germany and Italy while Spain and Sweden came in short of expectations. Gold is trading up slightly along with EUR so the move appears to be related to a bit of USD weakness this morning. The weakest paper currencies this morning have been AUD and NZD heading into tonight’s RBA meeting where the street is expecting another 0.25% interest rate cut. Interestingly, CAD is trying to shrug off another down day for WTI as speculation on a 0.25% rate cut in Canada this week continues to unwind following Bank of Canada Governor Poloz’s comments last week. Manufacturing PMI reports for the US and Canada are due later this morning which could keep indices hopping right through the day. Corporate News There are no major corporate announcements this morning. Economic News Economic reports released overnight and this morning include: People’s Bank of China surprise 0.25% 1-year lending rate cut to 5.35% surprise 0.25% deposit rate cut to 2.50% Manufacturing PMI Reports: China Official 49.9 vs street 49.7 China HSBC 50.7 vs street 50.1 China non-manufacturing 53.9 vs previous 53.7 Japan 51.6 vs previous 51.5 Australia 45.4 vs previous 49.0 UK 54.1 vs street 53.3 Germany 51.1 vs street 50.9 France 47.6 vs street 47.7 Spain 54.2 vs street 55.1 Italy 51.9 vs street 50.1 Sweden 53.3 vs street 55.0 Norway 51.2 vs street 51.5 Greece 48.4 vs previous 48.3 Eurozone 51.0 vs street 51.1 South Africa 47.6 vs street 51.5 Brazil 49.6 vs previous 50.7 India 51.2 vs previous 52.9 Other significant announcements: US personal income 0.3% vs street 0.4% US personal spending (0.2%) vs street (0.1%) US PCE core inflation 1.3% as expected Eurozone unemployment 11.2% vs street 11.4% Eurozone consumer prices (0.3%) vs street (0.4%) Eurozone core CPI 0.6% as expected Italy GDP (0,.4%) as expected vs previous (1.7%) Italy unemployment 12.6% vs street 12.9% UK Nationwide house prices 5.7% vs street 6.2% Australia inflation 1.3% vs previous 1.5% Australia commodity index (20.6%) vs previous (19.2%) Economic reports due later today include: 9:30 am EST Canada manuf PMI previous 51.0 9:45 am EST US Markit manuf PMI street 54.3 10:00 am EST US ISM manuf PMI street 53.0 10:00 am EST US construction spending street 0.3%