Wednesday, July 14, 2010

20100714 1813 FCPO EOD Daily Chart Study.

FCPO closed : 2381, changed : +28 points, volume : lower.
Bollinger band reading : correction downside biased.
MACD Histrogram : getting higher, buyer taking exposure.
Support : 2370, 2350, 2330 level.
Resistant : 2400, 2450, 2470 level.
Comment :
5th consecutive up day FCPO continue to closed higher in diminishing volume transaction following crude oil and soy oil futures price development.
Daily chart wise, market successfully break and closed above another resistant level and the outlook still shows a correction downside biased reading.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with larger cut loss and profit target.

20100714 1806 FKLI EOD Daily Chart Study.

FKLI closed : 1343.5 changed : +4.5 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : continue higher, buyer seized control.
Support : 1337, 1330, 1325 level.
Resistant : 1345, 1350, 1360 level.
Comment :
Range bound market FKLI closed in positive zone with better volume transacted. Daily chart shows that market touched nearly 2 months high but profit taking activities pressed price to closed near the low. Reading remained unchanged with an upside biased outlook.
When to buy : buy at support or weakness with larger cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100714 1328 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1344.5 changed : +5.5 points, volume : high.
Bollinger band reading : upside biased.
MACD Histrogram : continue higher, buyer in charge.
Support : 1337, 1330, 1325 level.
Resistant : 1345, 1350, 1360 level.
Comment :
FKLI upwards momentum continue today and ended the first session better with sustaining volume traded. Market opened gap up and traded in 6 points range bound as buyer decide to lock in partial profit. Outlook wise, market still having a upside biased reading with possible pullback correction.

20100714 1310 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2373, changed : +20 points, volume : low.
Bollinger band reading : upside biased.
MACD Histrogram : getting higher, buyer increase exposure.
Support : 2370, 2350, 2330 level.
Resistant : 2400, 2450, 2470 level.
Comment :
Firmer overnight crude oil and soy oil futures price lead FCPO to trade higher in light volume transaction.
Hourly chart shows that market opened and continue to seek higher ground breaking and stayed above 2370 resistant level. Outlook wise, market still registering an upside biased reading with possible pullback correction to take place soon.

20100714 1208 Global Economic News.

Philippines: Export growth quickens, boosting economy
Philippine exports rose at a faster pace in May as the global recovery spurred demand for electronics, sustaining the nation’s economic expansion and supporting President Benigno Aquino’s efforts to boost incomes. Shipments abroad increased 37.3% from a year earlier to USD4.24bn after climbing a revised 28.2% in April, the National Statistics Office said in Manila. (Bloomberg)

India: May increase rates, Singh’s advisers signal
The Reserve Bank of India may raise interest rates for a second time this month to slow inflation, Prime Minister Manmohan Singh’s top economic advisers signaled. “If inflation persists at double digit levels for several months together, some action by the Reserve Bank is required,” Chakravarthy Rangarajan, chairman of the Prime Minister’s Economic Advisory Council, said in New Delhi. (Bloomberg)

Japan: May hold policy stance on rebound at risk from Europe
The Bank of Japan may refrain from easing monetary policy tomorrow, choosing to preserve its arsenal in case economic weakness in Europe or a further advance in the yen threatens the nation’s export-led recovery. Governor Masaaki Shirakawa and his board will keep the main interest rate at 0.1% and forgo fresh liquidity injections, according to all 16 economists surveyed. Shirakawa said last week that the economy is “likely to stay on a recovery trend” and domestic demand is poised to rise. (Bloomberg)

UK: Inflation slows less than economists forecast
UK inflation slowed less than economists forecast in June as higher costs of goods from fuel to food kept the rate of price increases above the government’s 3% limit. Consumer prices rose 3.2% from a year earlier, compared with 3.4% in May, the Office for National Statistics said in London. Economists predicted 3.1%, according to the median of 27 forecasts in a Bloomberg News survey. (Bloomberg)
US: Trade deficit unexpectedly widened in May
The trade deficit in the US unexpectedly widened in May to the highest level in 18 months as a gain in imports outpaced an increase in shipments abroad. The gap expanded 4.8% to USD42.3bn as US companies imported more automobiles and consumer goods, Commerce Department figures showed in Washington. The deficit was projected to narrow to USD39 bn, according to the median forecast. (Bloomberg)

US: June budget deficit narrowed to USD68.4bn
The US government posted a smaller budget deficit in June compared with the same month last year as the economic recovery brought in more tax revenue. The excess of spending over receipts fell to USD68.4bn last month from USD94.3bn in June 2009, according to a Treasury Department report issued. It was the 21st consecutive shortfall. For the fiscal year to date, the budget deficit totaled USD1trn compared with USD1.42tn during the prior year to date. (Bloomberg)

U.S : Small-business confidence drops to three-month low in June as projections for profits, sales and economic conditions weakened. The National Federation of Independent Business's optimism index decreased to 89 from May's 92.2 reading that was the highest since September 2008. Seven of the index's 10 components dropped, led by a decline in the economic outlook six months from now. (Source: Bloomberg)

Germany : Investor sentiment drops in July as stress tests loom. The Mannheim-based ZEW Center for European Economic Research said its index of investor and analyst expectations, which aims to predict developments six months ahead, fell to a 15-month low of 21.2 from 28.7 in June. (Source: Bloomberg)

Portugal : Credit rating cut two notches to A1 at Moody's Investors Service because of a growing debt burden and weak economic growth prospects. "The Portuguese government's financial strength will continue to weaken over the medium term," Moody's said in a statement, adding that the outlook is stable. "The Portuguese economy's growth prospects are likely to remain relatively weak unless recent structural reforms bear fruit over the medium-to-longer term." (Source: Bloomberg)

Japan : The public pension fund sold more government bonds than it bought for the first time in nine years, underscoring concern that an aging population will make domestic investors less able to finance state borrowings. The fund sold a net JPY 443.2b (USD 5b) of Japanese government bonds in the year ended March 31. (Source: Bloomberg)

Australia : Business confidence little changed in June after falling the previous three months, as retail and wholesale companies reported improved sentiment. The confidence index dropped 1 point from May to 4, according to a National Australia Bank Ltd. survey of more than 500 companies between June 24 and June 30. (Source: Bloomberg)

Crude Oil : IEA forecasts world oil demand growth to slow in 2011 as advanced nations trail China and other developing countries. Worldwide daily crude oil consumption will climb 1.3 million barrels, or 1.6% YoY, to average 87.8 million a day, the Paris-based adviser said in a monthly report, leaving its estimate for this year unchanged at 86.5 million. (Source: Bloomberg)

20100714 1207 Malaysia Corporate News.

PAAB to sign deal with Perlis next month
Notwithstanding the problems in the Selangor Water restructuring sector, Pengurusan Aset Air (PAAB) will seal its deal with the Perlis government early next month, according to a source. It is understood that a press conference for this purpose will be called on 2 Aug. The deal, which was supposed to be sealed by end-May, “ran into the usual red tape” issues but everything was confirmed now and the signing would take place in early August, the source said. He declined to divulge the value of the deal but said it would follow largely in the footsteps of the takeover of water assets in Johor which were acquired at one time book value and was concluded on a “willing-buyer-willing-seller” basis. (Starbiz)

BRDB to jointly develop 2 parcels of MPHB’s land
Bandar Raya Developments (BRDB) is teaming up with Multi-Purpose Holdings group to develop several parcels of land measuring a total of 670.7 acres belonging to the latter in Penang, Rawang and Gombak. BRDB had on the same day entered into three separate memoranda of understanding (MoUs) with MPHB to record their intention to collaborate with each other on the proposed development of the land in Penang (80 acres), Rawang (266.7 acres) and Gombak ((324 acres). (FinancialDaily)

Nestle investing RM20m to raise Kit Kat plant output
Nestle (M) will invest RM20m this and next year to increase the production capacity at its Kit Kat plant in Chembong, Negeri Sembilan. Nestle Products SB business executive manager (confectionary division) Andrew Cooper said this would increase the plant’s capacity by 30%. (Starbiz)

Petra Energy gets new director
Integrated oil and gas brown field services provider Petra Energy has appointed three new directors – Abdul Rahim Hamid, Ahmad Azra Salled and Surya Hidayat Abdul Malik – effective yesterday. Abdul Rahim and Ahmad Azra were independent and non-executive directors while Petra Perdana executive director Surya Hidayat was a non-independent and non-executive director. (Starbiz)

MMosaics to be privatised at RM2.30 a share
Malaysian Mosaics announced yesterday that the company has received a privatisation proposal from its major shareholder, Gek Poh (Holdings) SB, at RM2.30 cash per share. The privatisation will be done via a selective capital repayment exercise whereby all minority shareholders of MMosaics (except Gek Poh and its subsidiary, Pembangunan Melati SB), will receive a cash payment of RM2.30 per share. The existing paid-up share capital of MMosaics will be reduced by cancelling all the ordinary shares issued and the company will be delisted. (FinancialDaily)

Bonds: Cagamas Bhd plans to sell up to RM5b Islamic bonds. Cagamas Bhd yesterday rolled out plans to sell up to RM5b of Islamic bonds crafted to suit Middle Eastern investors, a segment that has shied away from offerings from this part of the world due to differences of opinion on Shariah compliance. (Source: Malaysian Reserve)

LBS Bina: To launch RM5b China project next year. Property developer LBS Bina Group Bhd will launch its 4th project, worth over RM5b, in Zhuhai, China, in the 2nd half of next year. The 60:40 joint venture between LBS and Jiuzhou Group, a Chinese GLC, has been delayed by 3 years because of the uncertain economic conditions. Apart from that, it plans to launch 3 housing projects in Malaysia valued at RM600m and is issuing RM135m sukuk to part-finance those projects. (Source: Malaysian Reserve, Business Times)

Markets: Bursa has 45 firms under PN17 status. There are now 45 companies listed on Bursa Malaysia that are classified under PN17 or financially-troubled companies. Finance Minister Datuk Donald Lim Siang Chai said the ministry and Bursa would gather the views of those in the market on improving the financial standards of problematic local companies. (Source: The Star)

Nestle: Investing RM20m to raise Kit Kat plant output. Nestle (M) Bhd will invest RM20m this and next year to increase the production capacity at its Kit Kat plant in Chembong, Negeri Sembilan and this would increase the plant's capacity by 30%. (Source: The Star)

Utilities: Minister warns of water supply crisis. According to Energy, Green Technology and Water Minister Datuk Seri Peter Chin, the water restructuring issue in Selangor should not be muddled with the Langat 2 water treatment plant project as any delay in implementing the latter will result in a 13-14% water deficit by 2014. The estimates were based on the current level of water consumption in Selangor. (Source: The Star) 

20100714 1203 Global Market News.

July 14 (Bloomberg) -
- China’s slowing expansion may encourage officials to shift policy toward sustaining the rebound in the economy forecast to account for one-third of global growth this year. A government report tomorrow will show gross domestic product rose 10.5 percent in the second quarter from a year earlier, according to the median estimate in a Bloomberg News survey of 28 economists, down from an 11.9 percent pace in January to March. Industrial production and urban fixed-asset investment are also estimated to have slowed.

Euro recovers after Greek auction; stocks gain
LONDON, July 13 (Reuters) - The euro recovered  after Greece successfully returned to capital markets for the first time since late April, while global equities advanced after Alcoa delivered a strong start to the earnings season. "We were expecting a good result, and it's good for Greece and the euro, but Greece has a long way to travel, as its economic challenges are pretty severe," said Paul Robinson, FX strategist at Barclays Capital.

20100714 1152 Soy Oil & Palm Oil Related News.

Soyoil futures rallied Tuesday, climbing on a combination of meal/oil spread unwinding and the bullish influence of soaring crude oil futures, analysts said. Crude oil influences soyoil due to its use in making renewable fuels. December soyoil settled 0.45 cent, or 1.2%, higher at 38.81 cents per pound.(Source: CME)

Palm Prices To Remain Under Pressure As Output Rises -Analysts(Source: CME)
Palm oil prices will remain under pressure over the next few months despite a bullish crop report by the Malaysian Palm Oil Board as production is expected to recover, rising to a peak in the September-November period, analysts said Tuesday.
The MPOB Monday said end-June palm oil inventories fell 7.1% compared with end-May to 1.45 million metric tons, the lowest level since August last year, as exports rose 5.5% on month to 1.44 million tons.
"We believe the shortfall in palm production could be a reflection of the general shortage of foreign workers in Malaysia, which resulted in lower-than-expected yields. Output should recover seasonally in the next few months," Tan Ting Min, an analyst at Credit Suisse Malaysia, said in a note to clients.
Malaysia's labor-intensive palm oil sector faces a dearth of foreign workers after the government introduced stricter regulations to curb rising social and security problems and reduce dependence on foreign labor.
Also, most of the Indonesian workers, who comprise a large percentage of the plantation labour force, have opted to return home due to improved work prospects and higher wages.
CPO output in June rose only 2.5% to 1.42 million tons, as production in Sabah, the top palm oil producing state, fell 23% on month, data from MPOB showed.
Despite the weak growth in June production, a double-digit rise in output this month would probably mean inventory levels may reach higher levels at end-July, analysts and plantation company executives said.
Much of the palm crop development will also hinge on the developing La Nina condition, which brings increased rainfall to Southeast Asia, improving soil conditions for the rain-fed palm trees and boosting future yields.
"The La Nina impact on CPO is likely to be positive in the third quarter, as harvesting activities in some flood-prone palm oil estates in Southeast Asia may be affected by the heavier rainfall," CIMB Research said in a note.

Palm steady as soft oil, soybeans limit gains
JAKARTA, July 13 (Reuters) - Malaysian crude palm fell slightly by the end of morning trade  as softer crude oil and soybean prices erased earlier gains.
"Prices consolidated on the absence of fresh bullish news. Lower crude oil also failed to enthuse players," a trader at a local brokerage firm said.

China shows no sign of deal on Argentine soyoil
BEIJING, July 13 (Reuters) - Chinese officials showed no hint of striking a deal on Argentine soyoil imports on Tuesday, despite President Cristina Fernandez saying she expected to resolve the trade dispute within days.
Fenandez, who is visiting Beijing and will travel to Shanghai later in the week, said on Monday a deal would come within two or three days.

Rains to boost India's soybean harvest, meal export
NEW DELHI, July 13 (Reuters) - Revival in India's monsoon rains will help soybean output rise 9.7 percent this year, boosting oilmeal exports, industry officials said on Tuesday.
Farmers in India, the world's biggest edible oil importer and Asia's leading oilmeal exporter, plant soybean in the rainy months of July and August, with harvests starting from October.