HSBC Chinese flash manufacturing PMI has indicated contraction for a fifth consecutive month, slipping to 48.1 in March from 48.5 in February and missing consensus of 48.7.
New orders, employment and output shrank, although new export orders grew for the first time in four months.
The reading adds to other data which indicate that China's economy is slowing.
"Weakness is broadly based with domestic demand softening further," says HSBC. "We expect Beijing to launch a series of policy measures to stabilize growth."
Hopes of such stimulus have helped push the Shanghai Composite up 1%, while the Hang Seng is +1.7%. (PR)
ETFs: FXI, PGJ, GXC, FXP, YINN, CYB, KWEB, HAO, CNY, ASHR, CHIQ, DSUM, CHIX, TAO, YANG, CQQQ, MCHI, PEK, QQQC, XPP, YAO, CHXX, YXI, FXCH, CHII, CHXF, ECNS, CHIM, CHIE, KFYP, FCA, TCHI, CHLC, CHNA, KBA