Thursday, August 5, 2010

20100805 1900 FCPO EOD Daily Chart Study.

FCPO closed : 2619, changed : +29 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : rising, buyer getting aggressive again.
Support : 2600, 2570, 2550 level.
Resistant : 2620, 2650, 2670 level.
Comment :
Higher volume, higher closed and higher indicators FCPO continue to move upward as buyer press the buy button after Reuters announced a poll suggesting a lower year low stock level on crude palm oil during the second half session. Daily chart shows strength with a bullish engulfing wide range up bar candle and the reading suggesting a upside biased potential market.
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.

20100805 1900 FKLI EOD Daily Chart Study.

FKLI closed : 1366.5, changed : +1.5 points, volume : lower.
Bollinger band reading : side way range bound, upside biased.
MACD Histrogram : weakenning, buyer taking profit but still defending.
Support : 1360, 1350, 1345 level.
Resistant : 1375, 1385, 1395 level.
Comment :
Another slow quiet low volume tight range market FKLI edge up slightly after mixed regional market development. Daily chart wise shows market opened higher and partial profit taking activities press price lower to test near support level but last minute cash market recovery pull price to closed off the low of the day. Outlook wise, today low volume participation shows seller seems not interested to take exposure with the reading suggesting a range bound upside biased market development.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100805 1311 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1365.5, changed : +0.5 point, volume : low.
Bollinger band reading : side way range bound.
MACD Histrogram : weakening, buyer taking profit.
Support : 1360, 1350, 1345 level.
Resistant : 1375, 1385, 1395 level.
Comment :
Another quiet day on FKLI after market opened higher but immediately face selling pressure pushed price to closed off the high. Hourly chart wise, market is having a side way range bound development as market traded in a tight 5.5 points range market testing support and resistant level searching for new direction.

20100805 1308 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2580, changed : -10 points, volume : low.
Bollinger band reading : correction range bound, upside biased.
MACD Histrogram : weakening, buyer taking profit reducing exposure.
Support : 2570, 2550, 2520 level.
Resistant : 2600, 2620, 2650 level.
Comment :
FCPO eased lower traded in tight 16 points range ultra low volume transactions following soy oil and crude oil futures price that reversed lower after hitting overnight high and following the news about China closed major port for oil and other commodities after pipeline blast spilled oil into sea. Hourly chart shows market opened lower,  trying hard to test higher ground but buying interest seems lacking resulted price to closed little lower. Outlook wise, market still supported at the middle Bollinger band level and suggesting a side way range bound little upside biased market.

20100805 1255 Palm Oil Related News.

Aug. 5 (Bloomberg) -- Palm oil must rise by as much as 24 percent to cool export demand as output declines in Malaysia, the second-biggest grower, and dry weather damages canola crops in Europe and Canada, according to Dorab Mistry, a director at Godrej International Ltd. “The market needs to move ahead rapidly so that there is time for rationing to set in,” Mistry, who’s traded vegetable oils for more than three decades, said in an e-mailed reply to Bloomberg. “At 2,600 ringgit, you cannot match demand with supply. And on top of that, the supply is shrinking.”

20100805 1241 Latest News on China port closed.

Reuters energy reporter Chen Aizhu was first in revealing that  China`s major port Dalian was forced to close after a crude oil pipeline explosion and subsequent oil spill, forcing state oil giant PetroChina to cut refinery production and divert oil shipments. The reports were picked up  by Bloomberg the same day and matched by Dow Jones only a day later. Dalian is China`s No.2 oil port --a crude oil supply hub for two major PetroChina refineries and a leading export point for refined fuel.

20100805 0941 Global Economic News.

Thailand: Economy may expand as much as 8% in 2010, Korn says
Thailand’s economy may expand as much as eight percent this year, more than previously forecast, as exports and spending gather strength, Finance Minister Korn Chatikavanij said.“We are surprised by the rebound in exports and also the level in private investment and consumption as well,” he said. “Even with the political crisis, we can expect 7%. If things hum along the way they are, perhaps 8% will be achievable.” (Bloomberg)

Indonesia: Pledges ‘special attention’ on inflation, holds rate
Indonesia’s central bank pledged “special attention” to rising inflationary pressures, signaling less commitment to holding its benchmark interest rate at a record low. Bank Indonesia kept its reference rate at 6.5%, it said in a statement in Jakarta, matching all 22 economists’ forecasts in a Bloomberg News survey. The board pledged steps as needed to keep price gains within its target. (Bloomberg)

China: Said to tell banks to stress test for 60% home-price drop
China’s banking regulator told lenders last month to conduct a new round of stress tests to gauge the impact of residential property prices falling as much as 60% in the hardest-hit markets, a person with knowledge of the matter said. Banks were instructed to include worst-case scenarios of prices dropping 50% to 60% in cities where they have risen excessively, the person said, declining to be identified because the regulator’s requirement hasn’t been publicly announced. (Bloomberg)

EU: Retail sales unchanged as Germany, France show declines
European retail sales were unchanged in June as households cut spending in Germany and France. Sales in the 16-nation Euro area showed no increase from May, when they rose 0.4%, the European Union’s statistics office in Luxembourg said. From a year earlier, June retail sales gained 0.4% after rising 0.6% in May. (Bloomberg)

EU: Services, manufacturing growth accelerates
Growth in Europe’s services and manufacturing industries accelerated in July, suggesting the recovery will maintain its momentum. A composite index based on a survey of euro-area purchasing managers in both industries rose to 56.7 from 56 in June. A reading above 50 indicates expansion. (Bloomberg)

US: Service companies grew at faster pace
Service industries expanded in July at a faster pace than forecast, reflecting an increase in employment that eases the risk US economic growth will slacken in the second half of the year. The Institute for Supply Management’s index of non- manufacturing businesses, which covers about 90% of the economy, rose to 54.3 from 53.8 in June. Readings above 50 signal expansion. (Bloomberg)

20100805 0939 Malaysia Corporate News.

GenM wins racino bid, subject to more approvals
Genting Malaysia's (GenM) subsidiary Genting New York LLC (Genting NY) has won the bid to develop and operate a video lottery facility at the Aqueduct Racetrack in New York with a proposal that includes a USD380m (RM1.2bn) upfront licensing fee. GenM said New York Lottery announced on 3 Aug that its evaluation committee had unanimously recommended to the New York governor that Genting NY be awarded the aqueduct racino project. “The recommendation will have to be approved by the New York governor, the temporary president of the New York State Senate and the speaker of the New York State Assembly before the video lottery license can be awarded,” the company said. GenM said Genting NY would work closely with the relevant parties, including the operator of the Aqueduct Racetrack, the New York Racing Association, and expected to open the preliminary phase of Resorts World New York six months after the award of the licence. (Financial Daily)

Malaysia's Affin buys Indon bank
Affin Bank is making a foray into the Indonesian market via the proposed acquisition of PT Bank Ina Perdana for RM138m. To be funded internally, the acquisition is Affin Bank’s maiden venture beyond Malaysian borders. With the acquisition and subsequent subscription of shares, Affin Bank will have a direct majority shareholding of 80% in Bank Ina, which has 22 branches, sub-branches and cash offices in major cities in Indonesia. For the financial year ended 31 Dec 2009, the Jakarta-headquartered bank made an after-tax profit of about RM4.75m, Affin Bank’s parent company Affin Holdings told Bursa Malaysia. Its net assets totalled RM39.74m as at 31 Dec 2009. (StarBiz)

AirAsia defers delivery of A320s
AirAsia has deferred the delivery of seven Airbus A320 to 2015 from the original delivery period next year as it foresees infrastructural constraints with the current airport facilities. The low-cost carrier said it had signed an amendment agreement with Airbus SAS for the revision of delivery dates. The seven planes are now due for delivery from April to November 2015 from the original March to October 2011. “With the deferment, the delivery of aircraft in 2011 shall be reduced to eight planes from the original 15. Also, the number of aircraft delivery in 2015 will increase to nine from the planned two,” it said. AirAsia said until the new low-cost carrier terminal was constructed, the present infrastructure at the terminal would not be able to accommodate AirAsia’s fleet expansion in the number of aircraft originally scheduled to be delivered in 2010 and 2011. (StarBiz)

Hwang-DBS rejects licence in Cambodia 
Hwang-DBS (M) told Bursa Malaysia that the Securities and Exchange Commission of Cambodia (SECC) had vide its letter dated 2 Aug granted an approval-in-principle to HwangDBS Securities (Cambodia) Plc, a whollyowned unit of HwangDBS Commercial Bank Plc which in turn is wholly-owned by the company, to act as an investment advisory firm. However, the board of HwangDBS Securities (Cambodia) Plc has decided to turn down the approval-in-principle licence due to the limited activities permitted. “The application submitted to SECC was for a securities firm licence to undertake stockbroking, corporate finance, underwriting and investment advisory activities. With an investment advisory firm licence, HwangDBS Securities (Cambodia) is permitted to render advice to investors on investment in securities for a fee and publication of investment analysis on securities investment,” it said. (StarBiz)

Axiata to sell bulk of RM4.2bn sukuk to EPF?
Axiata Group is expected to sell the bulk of its planned RM4.2bn Islamic bonds to the Employees Provident Fund (EPF), sources said. “There’s a signing ceremony with the EPF next week and the provident fund is taking up about RM3bn, There will be two other investors on top of the provident fund,” sources said. It was reported as saying that the sukuk, which will have maturities of five, seven and 10 years, would be privately placed out. (Financial Daily)

Ta Ann shutting down China venture
Ta Ann Holdings has notified authorities in China of its intention to withdraw from investing in Yang Zhou, the company told Bursa Malaysia yesterday. To recap, the company has formed Ta Ann Eco-Timber Industries Pty Ltd (TAET) for the setting up of a plywood mill in Yang Zhou. Tan Ann said the plywood market in China was adversely affected by the global financial crisis, making it not feasible to proceed with the plywood mill project. Ta Ann has invested USD4m in the China venture, mainly for the purchase of land and machineries. It said the Chinese authorities had approved its earlier application to partially return the land purchased in line with its downsizing proposal. “Now, we are applying to return to them the remaining land, to bring the machineries back to Malaysia and to repatriate to Malaysia the bank balance (4,721,523 yuan as at 30 June) and proceeds from the land returned,” it said. (StarBiz)

Zelan soars as US fund emerges
Zelan's shares soared 17.5 sen, or 28.9% yesterday, to a six-month high of 78 sen on news of the entry of a new substantial shareholder. According to an announcement to Bursa Malaysia yesterday, the US-registered Grantham, Mayo, Van Otterloo & Co LLC acquired 28.28m Zelan shares, or a 5.02% stake in the company, on 2 Aug. According to its website, the Boston-based company, better known as GMO is a global investment management firm managing funds for endowments, pension funds, public funds, foundations and cultural institutions. (Financial Daily) 

20100805 0927 Global Market News.

GLOBAL MARKETS: Stocks, dollar rise on U.S. economic dataNEW YORK, Aug 4 (Reuters) - Global stocks edged higher and the dollar rebounded from an eight-month low versus the yen on Wednesday after better-than-expected readings of U.S. and European economic data rekindled bets on riskier assets.
"People still have a lot of concerns about economic growth right now, and people are thinking the economy is slowing. These numbers haven't been strong enough to disabuse anyone of that opinion," said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.

Shares fall, dollar near 15-yr low vs yen
LONDON, Aug 4 (Reuters) - Global shares fell and the dollar headed towards a 15-year low against the yen on growing concern about the U.S. economy as recent data has sparked talk of more monetary easing by the Federal Reserve.
"Economic data in the U.S. has been pointing towards a slowing economy and while earnings have been better than expected, there are worries about the future. It is not the full support the market needs," said Bernard McAlinden, investment strategist at NCB Stockbrokers, in Dublin.

U.S. consumer, housing data fan recovery worries
WASHINGTON, Aug 3 (Reuters) - U.S. consumer spending and incomes were flat in June while home purchase contracts tumbled to a record low, implying an anemic economic recovery for the remainder of this year.
The reports on Tuesday showed the recovery assumed a decisively sluggish tone in the last month of the second quarter, setting up the July-September period for a lackluster performance just as lawmakers hit the hustings before November elections.

July U.S. auto sales up in uneven recovery
DETROIT, Aug 3 (Reuters) - U.S. auto sales rose 5 percent in July in an uneven recovery that left Toyota Motor Co  and Honda Motor Co  sputtering with declines from strong results a year ago.
The two U.S. automakers run through government-funded bankruptcies last summer, General Motors Co and Chrysler, posted sales gains of 5 percent each.

China Q3 GDP to slow to 9.2 pct yr/yr-think tank
BEIJING/SHANGHAI, Aug 4 (Reuters) - China's economy will cool further this quarter as fiscal pump-priming starts to fade and the restocking cycle draws to a close, a government think tank said on Wednesday.
Annual gross domestic product growth will slow to 9.2 percent from 10.3 percent in the second quarter and 11.9 percent in the first, the State Information Centre said in a report published in official media.

20100805 0925 Soy Oil & Palm Oil Related News.

Soyoil futures rallied to multi-month highs, propelling on spillover strength from soybeans, technical buying and optimistic outlooks for demand amid European crop concerns, analysts said. Nearby contracts set 5-month highs, while the new crop most active December futures set a 7-month high. December soyoil settled 0.42 cents or 1% higher at 42.10 cents per pound.(Source : CME)

Festive demand, weather boost palm oil to four-month top
KUALA LUMPUR, Aug 4 (Reuters) - Malaysia crude palm oil futures hit a four-and-a-half-month high as expectations of festive demand and weather concerns worldwide lifted sentiment.
"Traditionally, seasonally harvesting is going to slow down due to the fasting season (the Muslim holy month of Ramadan), so I believe in August production may go down a bit," said a trader with Kuala Lumpur-based foreign brokerage.

India's festive vegoil imports to rise 10 pct-trade
NEW DELHI/KUALA LUMPUR, Aug 4 (Reuters) - India's festival demand for vegetable oils may rise 10 percent to 2.25 million tonnes from a year ago as prospects brighten for Asia's third largest economy, Asian traders surveyed by Reuters said.
But an improving monsoon and farmers holding huge local oilseeds stocks may weaken the pace of imports for the world's No.1 buyer of vegetable oils.

ADM building soy processing plant in Paraguay
CHICAGO, Aug 3 (Reuters) - U.S. agricultural processor Archer Daniels Midland  said on Tuesday that it was building an oilseed processing plant in Villeta, Paraguay, with the capacity to crush 3,300 tonnes of oilseeds a day.
The plant is scheduled to be completed by 2012 and will expand ADM's South American oilseed crush capacity by more than 25 percent, ADM said.