Friday, August 13, 2010

20100813 1322 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1357, changed : +11 points, volume : low.
Bollinger band reading : side way range bound.
MACD Histrogram : getting higher, buyer defending.
Support : 1350, 1345, 1337 level.
Resistant : 1360, 1375, 1385 level.
Comment :
FKLI opened higher and continue to head north by registering big gains with slower volume traded ahead of the weekend on par with cash market. Hourly chart wise, price traded near upper Bollinger band level with the band width getting wider with potentially testing higher resistant level but the overall picture still call for a side way range bound market reading.

20100813 1309 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2704, changed : +31 points, volume : high.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : recovering, buyer may continue to build position.
Support : 2700, 2670, 2650 level.
Resistant : 2720, 2750, 2770 level.
Comment :
26 points range FCPO recorded gain for the first session in strong supportive volume traded after soy oil and crude oil recovered strongly. Hourly chart wise, market opened and broken higher resistant level with the reading suggesting a side way range bound little upside biased market development.

20100813 1055 Local & Global Economic News.

Malaysia: Ringgit slips as investors seek safe haven
The ringgit slipped against the greenback for a third straight day yesterday as investors continued to go for the safe haven dollar amid growing signs of a slower world economic recovery. At 5pm on Thursday, the local unit was lower at 3.1830/1860 compared with Wednesday's closing of 3.1710/1750."There is more and more news that momentum in the global economy is waning," a dealer said. (BT)

Philippines: Should keep interest rates steady
The Philippines should keep interest rates at a record low as the outlook for inflation remains “benign,” central bank Deputy Governor Diwa Guinigundo. “It is best that we keep the rates steady and wait for additional indicators to be more apparent.” (Bloomberg)

Hong Kong: Growth may slow to 6.3%
Hong Kong’s economy probably expanded for a third straight quarter from a year earlier as the city sustained its recovery from the global financial crisis. Gross domestic product rose 6.3% in the three months ended 30 June. In the first quarter, the expansion was 8.2%.(Bloomberg)

Australia: Hiring growth slows, boosting jobless rate
Australian employment growth slowed in July, driving down the nation’s currency as investors bet the central bank will extend a pause in the most aggressive round of interest-rate increases. The number of people employed gained 23,500 from June, when it rose a revised 37,400. The jobless rate climbed to 5.3% from 5.1% as more people entered the labor market. (Bloomberg)

 India: Industrial output grows least in 13 months
India’s industrial production rose at the slowest pace in 13 months in June, adding to evidence that Asian economies are weakening. Output at factories, utilities and mines rose 7.1% after a revised 11.3% gain in May from a year earlier, the statistics department in New Delhi said. (Bloomberg)

Japan: Refrains from outlining steps to halt yen climb
Japanese Finance Minister Yoshihiko Noda refrained from outlining steps to arrest this year’s 9% surge in the yen, prompting the currency to recover its losses against the dollar. “We will monitor economic conditions carefully and respond appropriately,” Noda said. (Bloomberg)

Greece: GDP shrinks for seventh quarter, unemployment rises
Greece’s economy contracted for a seventh quarter and unemployment rose as the wage-cuts and tax increases that aim to trim the European Union’s second-biggest budget deficit deepened a recession. Gross domestic product shrank 1.5% in the second quarter from the previous three months. (Bloomberg)

US: Jobless claims in US unexpectedly climbed last week
More Americans than forecast filed applications for unemployment benefits last week, signaling firings stepped up as the economy slowed. Initial jobless claims rose by 2,000 to 484,000 in the week ended 7 Aug, the highest level since mid-February. (Bloomberg)

20100813 1054 Malaysia Corporate News.

P&O receives nod to talk to Prudential
Bank Negara Malaysia has given the nod for Prudential Holdings Ltd to begin talks to buy a stake in insurer Pacific & Orient (P&O), a source with direct knowledge of the deal said yesterday. According to the source, P&O has received the approval via fax on Wednesday morning but there have been no discussions about a price yet. P&O declined to comment while Prudential’s Malaysian officials were not immediately available. P&O had said this month it asked the central bank for approval to begin preliminary talks for the potential divestment of an equity interest in Pacific & Orient Insurance to Prudential. (Financial Daily)

Genting New York wins racino franchise bid
Genting Malaysia’s subsidiary Genting New York LLC has won a 30-year franchise to redevelop the Aqueduct Racetrack in Ozone Park, New York, according to a Singapore Straits Times report. The franchise will give Genting New York the licence to operate the city’s first slow machine-styled “racino” video lottery terminals. The Singapore Straits Times yesterday said Genting New York had won the bid, but the deal was “not fully in the bag” yet pending approvals from the city’s top politicians. New York State Division of Lottery had on 3 Aug recommended a bid by Genting New York to implement the “racino” project. Yesterday, a Bloomberg report said the state Senate majority leader John Sampson announced he had accepted a lottery commission recommendation for Genting New York to be awarded the licence to install 4,500 slot machine-styled “racino” terminals at the Aqueduct site in the borough of Queens. (Starbiz)

Petra Perdana cancels ship purchase
Petra Perdana has cancelled one of two so-called anchor handling/offshore support vessels ordered from Nam Cheong Dockyard SB. The vessel costs USD29.5m (RM93.96m) a unit, and a deposit of USD8.85m was paid for each one, according to the filing to Bursa Malaysia yesterday. Nam Cheong agreed to refund the deposit paid, Petra Perdana said. However, no reason was provided for the cancellation. (Malaysian Reserve)

Move to stop 19 Aug EONCap meeting
A small investor has gone to court to have the meeting to vote on Hong Leong Bank's RM5.06bn offer declared invalid. It is possible that EON Capital's (EONCap) much-anticipated shareholder meeting on 19 Aug may be delayed as a small investor has gone to court to have it declared invalid. The meeting is to vote on Hong Leong Bank's RM5.06bn takeover offer. EONCap, in a stock exchange filing late yesterday, said it received a summons filed by Shu Pei Huang, who owns 200 shares, to attend a High Court hearing on the matter next Monday. Little is known about Shu, who, among other things, is challenging the EGM's timing and whether it fulfills a requirement for shareholders to have at least 21 days' notice. He wants the court to declare the notice for the meeting invalid. (BT)

Khazanah has 64% acceptance level for Parkway
Khazanah Nasional had secured a 64.1% level of acceptances in its voluntary general offer (VGO) for the takeover of Singapore hospital group Parkway Holdings Bhd as at Tuesday. While the actual closing is at 5pm on Monday, Integrated Healthcare Holdings Ltd (IHHL), which is an indirect wholly-owned subsidiary of Khazanah, has in effect gotten the necessary majority to take over Parkway at SGD3.95 (RM9.25) per share. As at 5pm on Tuesday, IHHL had received 458.37 million shares, or 40.2%, of Parkway. Sources said this also included Fortis Healthcare Ltd’s 23.9% stake in Parkway. Taking into account the 269.83m shares or 23.8% stake by Khazanah, this means that Khazanah already has a 64.1% acceptance level. (Starbiz)   

20100813 1023 Global Market News.

Asian stocks rebound, yen extends retreat
SYDNEY, Aug 13 (Reuters) - The yen inched further away from 15-year peaks as talk swirled that Japan's authorities may soon intervene to curb it, while Asian stocks edged up to claw back some of the week's heavy losses.
"The market had probably been pretty oversold although given the sentiment out there and the week we've had, there's a risk things could drift heading into the afternoon," said Cameron Peacock, an equity analyst at IG Markets in Sydney.

COMMODITY MARKETS: Grains, beans, sugar, cotton soar on Aug USDA data
NEW YORK, Aug 12 (Reuters) - U.S. wheat futures surged over 2.5 percent by the close, corn and soybeans followed wheat, sugar soared 4 percent and cotton futures finished near a 3-1/2 month high on Thursday all sparked by the U.S. government's assessment of the coming year's crop.
"It looks to me like its macro-fund buying in sugar. I think we're seeing money being invested in buying foodstuffs," said Sterling Smith, a commodity analyst for brokers Country Hedging Inc in Minnesota.

GLOBAL MARKETS: Stocks slip, dollar gains on global growth worry
NEW YORK, Aug 12 (Reuters) - Global stocks slid and the U.S. dollar strengthened on Thursday after weakness in the American jobs market sapped the appetite for risk, driving gold to its biggest one-day gain in more than two months.
"With the weak job report and everything else we heard in the past couple of days, you are finding a safe-haven bid in gold," said Fred Schoenstein, a trader at Heraeus Precious Metals Management in New York.

Hong Kong’s Growth May Slow to 6.3% as Chinese Economy Cools (Bloomberg) -- Hong Kong’s economy probably expanded for a third straight quarter from a year earlier as the city sustained its recovery from the global financial crisis. Gross domestic product rose 6.3 percent in the three months ended June 30, according to the median estimate in a Bloomberg News survey of 13 economists. In the first quarter, the expansion was 8.2 percent. The figure is due at 4:30 p.m. today. Growth may keep cooling through the rest of this year as a slowdown in China flows through to the city that serves as trading and financial hub for the world’s fastest-growing major economy. Hong Kong’s gross domestic product may

ANALYSIS-Fast-fading U.S recovery now looks even weaker
WASHINGTON, Aug 11 (Reuters) - U.S. consumers will set the course for a gasping economic recovery that is starting to lose two of its strongest sources of support.
Economists have long expected that growth would slow in the second half of this year as government stimulus spending dries up, state and local governments slash outlays, and companies finish restocking lean inventories.

Eurozone June industry output down, strong over Q2
BRUSSELS, Aug 12 (Reuters) - Euro zone industrial production declined in June, with output in France and Germany falling sharply, but a strong showing over the second quarter as a whole suggests Friday's GDP data for the bloc will be robust.
Output fell 0.1 percent month-on-month; figures released by Eurostat on Thursday showed, and rose 8.2 percent year-on-year, although the drop followed sharp increases in April and May.

Global risk selloff eases, worries remain
LONDON, Aug 12 (Reuters) - Financial markets regained some composure after the previous session's broad selloff of riskier assets, with European shares inching up but the euro hurt by new worries about some of its weaker member economies.
"We could see economies relapse and double dip or struggle through and begin to grow with private demand starting to carry their weight," said Peter Elston, strategist at Aberdeen Asset Management in Singapore.

20100813 1021 Soy Oil & Palm Oil Related News,

Soy product futures ended mixed, with adjustments in the meal/oil spread featured. Soyoil retreated, losing product value today on the heels of a massive gain in 2009/10 U.S. soy oil ending stocks, as USDA throttled back old crop bio diesel use 200 million lbs, said Rich Feltes, senior vice president research at MF Global in Chicago. Soymeal rallied in step with soybeans. December soyoil settled 0.55 cent or 1.3% lower at 41.83 cents per pound. December soymeal ended $8.30 or 2.9% higher at $296.20 per short ton.(Source: CME)

Brazil Soy Output Seen At 67 Million Tons In 2010-11.(Source: CME)
Brazilian agricultural consultancy AgraFNP on Thursday pegged Brazil's upcoming 2010-11 soybean output at 67 million metric tons.
AgraFNP, in a preliminary second crop estimate for the 2010-11 crop season, said that Brazil's soy should dip from a record 68.5 million tons in the 2009-10 season that ended its harvest in May.
In Brazil--the world's No. 2 producer of soybeans after the U.S.-- dry weather during the upcoming crop season is likely to be less favorable than this season, Jacqueline Bierhals, an AgraFNP analyst, told Dow Jones Newswires.
The La Nina weather phenomena could hamper productivity especially in the south of Brazil, she added.
La Nina involves a cooling of the surface waters off the coasts of South America and generally causes decreased rainfall and cooler temperatures in Brazilian farmlands.
AgraFNP said that 23.2 million hectares should be planted with soybeans in 2010-11, compared with 23.3 million hectares in 2009-10.
Brazil's average yield should be around 46.6 per 60-kilogram bag of soy per hectare in 2010-11 due to dry weather, compared with 49 bags per hectare in 2009-10, Bierhals said.
AgraFNP's estimate is higher than the U.S. Department of Agriculture's forecast on Thursday of 65 million tons, but less than rival consultancy AgRural's forecast of 70 million tons for the upcoming crop.
Brazil is in its inter-harvest period and planting should start in September or October.

Cargill Makes First Foray Into Argentina Biodiesel Market.(Source: CME)
Commodities giant Cargill Inc. has leapt into the ballooning Argentine biodiesel market and will build its first plant in the South American country this year to produce the so-called green fuel.
The company plans to spend 450 million pesos ($113 million) to build an 18 megawatt power plant and biodiesel facilities with capacity to make 240,000 tons per year, the Minnesota company said in a press release Thursday. Both are expected to be operational by September 2011.
Argentina's biodiesel production has quadrupled in the last four years and capacity totals more than two million cubic meters. Most is exported to the European Union, although domestic use is expected to soar as blending requirements rise.
Last month, the government boosted the amount of biodiesel to be blended with normal diesel to 7%, from 5%, and it wants to reach 10% by year-end. Earlier this year, Planning Minister Julio De Vido said that within four years biodiesel will account for about 20% of the regular diesel mix.
Argentina makes biodiesel out of soybeans, the county's top crop. Exporters enjoy a tax break for turning the beans into fuel--biodiesel exports are taxed at 20% while soyoil shipments carry a 31% export duty. In addition, the government is working to fix a minimum domestic sale price to ensure profitability for manufacturers and stimulate production.
The banks of the Parana river in Santa Fe province are lined by a number of large grain processing and export complexes and most of the farm exports from Argentina pass through the region on their way to overseas markets. The area has also become a hub for biodiesel output with the top grain processors investing hundreds of millions of dollars in recent years to build biofuels capacity.
Argentina's increased blending requirements and steps to implement them will be a boon to soyoil exporters, who have seen sales to top buyer China cut off due to a trade dispute.
In April, China blocked imports of Argentine soyoil citing failure to meet Chinese purity standards, but many see the move as retaliation for antidumping sanctions imposed by Argentina on a number of Chinese imports.
While Argentina has increased soyoil sales to India to partially make up for lost exports to China, exporters and farmers are paying for it dearly due to steep discounts. Argentine soyoil has been selling at a discount of about $50 per ton compared to Brazilian soyoil, according to the Buenos Aires Cereals Exchange. That works out to about 5%.
About 6 million tons of soyoil exports will be affected this season, bringing down farm profits and export tax revenue, according to the exchange.
Cargill said it expects to use about 30% of the soyoil produced at its plant to produce biodiesel for the local and export market.

Palm oil almost flat before USDA report, exports eyed
KUALA LUMPUR, Aug 12 (Reuters) - Malaysian crude palm oil futures barely moved as traders awaited a key U.S. report on world grains demand and supply that has recently driven vegetable oil markets.
"There's not much fundamental factors involved, everybody is watching out for the USDA report tonight... there'll be some disturbing factors," said a trader with Kuala Lumpur-based foreign brokerage.

Indonesia forest moratorium to stymie palm oil firms
JAKARTA, Aug 12 (Reuters) - Indonesia's plans to halt forest clearing will slow the aggressive expansion of plantation firms in the world's top palm oil producer, leading to higher costs as firms will need acquisitions or improved yields to boost growth.
The two-year moratorium on new permits to clear natural forest from 2011 will increase land prices, pushing some to consider following industry leader Wilmar  in expanding overseas to Africa or to diversify into food crops.

20100813 1000 FCPO EOD Daily Chart Study(12 Aug 2010).

FCPO closed : 2673, changed : -3 points, volume : higher.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : weakenning, buyer profit taking continues.
Support : 2670, 2650, 2620 level.
Resistant : 2700, 2720, 2750 level.
Comment :
Tested support and resistant FCPO ended just 3 tick lower in better volume changed hand as buyer program selling continue realising profit for their position. Daily chart formed another doji bar candle still having correction take place with overall upside biased market 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 quick cut loss and profit target.

20100813 0944 FKLI EOD Daily Chart Study(12 Aug 2010).

FKLI closed : 1346, changed : -1.5 point, volume : higher.
Bollinger band reading : side way range bound little downside biased.
MACD Histrogram : getting lower, buyer closing some position.
Support : 1345, 1337, 1330 level.
Resistant : 1350, 1360, 1375 level.
Comment :
FKLI ended the day marginally lower with increasing volume transacted after market opened and tested lower before recovered upward. Daily chart wise, price traded range bound near lower Bollinger band level with the reading suggesting a side way range bound little downside 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.