Asian equity markets trade lower following the weak close on Wall St. coupled with discouraging Chinese PMI figures over the weekend where manufacturing PMI was in contradictory territory for a 3rd month, while services PMI was at its lowest since 2008. Nikkei 225 (-1.69%) under-performs to trade back below the 19,000 level with JPY strength weighing on exporters, while ASX 200 (-1.44%) is pressured by financials after big-4 bank Westpac reported that cash profit rose at its slowest pace in 6yrs. Chinese bourses under-perform on the back of the aforementioned PMI figures over the weekend, however did see some pairing of losses after China Caixin manufacturing PMI did beat expectations although the rebound was not too significant as the figure showed an 8th month of contraction, while a slew of poor earnings added to the negative risk sentiment in the Shanghai Comp. (-0.78%).

In FX markets, AUD/USD, rose following Chinese Caixin PMI surpassed estimates, while USD/CNY fell by more than 50 pips following the strongest CNY fixing since 2005 after the currency gained in Friday’s session. Elsewhere, TRY strengthened after the ruling AKP party won an unexpected majority at the Turkish elections, while JPY is also stronger on safe haven bids.

Finally, 10yr JGBs trade lower amid lack of buying by the BoJ with Japan expected to be away tomorrow due to Culture day public holiday, which now turns focus to the JPY 300bln enhanced liquidity auction in the 21nd half of trade.