2:32 PM PT -- Recap -- The initial reading of February's HSBC Chinese manufacturing data indicated a four-month high, but suggested continued contraction in factory activity. The index hit 49.7, up from 48.8 in January. Results below 50 indicate weakness, which may be good news for the market as more easing policies are undertaken. The MSCI Asia Pacific Index gained 0.4%. The Stoxx Europe 600 index lost 0.7% on the heels of data indicating eurozone contraction of business activity. US stocks turned mildly lower after existing home sales jumped by 4.3% in January to 4.57 million, which was below forecasts. December's numbers were revised downwards to 4.38 million. The median existing home price in January declined 2% from last year. Housing inventory for January was reported at 2.31 million, down 0.4%, the lowest since March 2005. For the week ended last Friday, the 30-year mortgage rate was unchanged at the record low of 3.87%. The $35B 5-year Treasury auction resulted in the highest yield since September at 0.90%. The 5-year breakeven inflation rate is 2.03%, so the effective yield is negative by more than 1.00%.The US$ index strengthened, especially against the British Pound and Japanese Yen, hitting a seven-month high. Gold dipped earlier in the session but soon attracted buyers as the price ran up over $20/oz. Crude oil was aimless, ending marginally weaker. Stocks meandered around unchanged and near the close dipped to end slightly lower.

Fitch downgraded Greece to junk status, to C from CCC. National parliaments of EZ countries still need to approve the Greek bailout. European banks will be swapping out their Greek bonds for more secure bonds. Greek banks are being recapitalized so that losses can be scrubbed off balance sheets and therefore insulate the European banking system from any future Greek default. Iran remains defiant, booting IAEA inspectors from areas where weaponization experimentation is suspected. Talks yielded "no way forward." The US and UK have warned Israel over attacking Iran unilaterally, while Israel isn't likely to sublet their nation's security to others. Meanwhile, stock market bulls are climbing a wall of worry. The next target for the March S&P 500 appears to be 1375, the S&P 500’s 2011 high, with support at 1333.