Monday, August 16, 2010

20100816 1810 FKLI EOD Daily Chart Study.

FKLI closed : 1369.5, changed : +8 points, volume : lower.
Bollinger band reading : upside biased.
MACD Histrogram : recovering, buyer defending.
Support : 1360, 1350, 1345 level.
Resistant : 1375, 1385, 1395 level.
Comment :
FKLI surged higher in lesser volume traded despite a mixed regional market development after market opened and tested lower support level and just rebound upward to closed near the high of the day. Daily chart up bar candle seem trying to test higher resistant level near upper Bollinger band with the reading suggesting a upside biased market outlook for the near term.
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.

20100816 1326 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1363.5, 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 : 1360, 1350, 1345 level.
Resistant : 1375, 1385, 1395 level.
Comment :
FKLI ended first session up 2 points in slow volume transaction after market opened lower but recovered to register minor gain. Hourly chart reading suggesting market to trade range bound upside biased for the near term as market await fresh lead to determined market direction.

20100816 1325 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2712, changed : +22 points, volume : moderate.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : getting lower, buyer lock in profit.
Support : 2700, 2670, 2650 level.
Resistant : 2720, 2750, 2770 level.
Comment :
Over the weekend soy oil futures price rallied lead FCPO to opened higher but a lower export data released by ITS(-7.4%) triggered buyer to secure profit pressed price lower to closed off the high but still recorded gain. Hourly chart wise, market is currently having correction range bound little upside biased development after opened above upper Bollinger band.

20100816 1324 FCPO Weekly Chart Study.

Weekly Close: 2718, High: 2737, Low: 2682, Range: 85 points
FCPO closed : 2718, changed : +57 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : getting higher, buyer defending position.
Support : 2700, 2650, 2600 level.
Resistant : 2720, 2800, 2850 level.
Comment :
4th week gained FCPO continue to trade higher with increasing volume changed hand after market worried over supply issue due to decreasing stock level condition. Weekly chart formed and up doji bar candle hovering at the upper Bollinger band with the reading suggesting a upside biased market development with possible pullback correct take place.

20100816 1323 FKLI Weekly Chart Study.

Weekly Close: 1361.5, High: 1367, Low: 1338, Range: 29 points.
FKLI closed : 1361.5 changed : -1.5 point, volume : higher.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : rising, buyer in charge.
Support : 1360, 1350, 1335 level.
Resistant : 1375, 1385, 1395 level.
Comment :
Improved volume(but still consider low) FKLI eased marginally lower week on week after market opened and tested lower support level and recovered upward as buyer came in to support the market. Weekly chart formed a long lower shadow doji bar candle and traded in between upper and middle Bollinger band indicate that correction is taking place as the previous candle touched upper Bollinger band. Reading wise, market is still traded upside biased with correction range bound market taking place in the immediate term.

20100816 1158 Global Economic News.

HK: Tighter lending rules, land supply, may stabilize prices
Hong Kong’s tightening mortgage lending rules and plan to increase the supply of land may help cool surging home prices in the city. Down payments for apartments costing HKD12m or more will rise to 40% from 30% with immediate effect, Hong Kong Monetary Authority said. The government will also increase land sales next year according to Financial Secretary John Tsang. (Bloomberg)

China: Favouring euros over greenback as Bernanke shifts course
China, whose USD2.5tn in foreign exchange reserves are the world’s largest, is turning bullish on Europe and Japan at the expense of US. The nation has been buying “quite a lot” of Europe’s bonds, said a former adviser to the People’s Bank of China. It bought JPY1.7tn more Japanese debt than it sold in the first half of 2010, the fastest pace of purchases in at least 5 years. (Bloomberg)

Russia: Banks flock to foreign debt market as deposits at record
Russian banks are stepping up international bond sales after relative corporate borrowing costs fell to their lowest level in 3 months and record deposits increased the allure of the lender’s debt. The yield difference for Russian company debt compared with government bonds sank to 91bps on 5 Aug, the lowest since 27 April and down from 942 in October 2008. (Bloomberg)

South Korea: May need extra tax for reunification
South Korea needs to prepare for eventual unification tax with North Korea and should consider a special tax to cover the costs that will incur, its President Lee Myung Bak said. The comments came amid heightened tensions on the Korean peninsula over the possible succession of North Korean leader Kim Jong-il by his son Kim Jongun. (Bloomberg)

US: Production, housing starts probably rose
Factory production and housing starts probably rose in July as part of the US economy’s uneven transition to a slower pace of growth in the second half of the year, economists said. Output increased 0.5%, led by a rebound in auto making as fewer plants closed for mid-year retooling, according to the median estimate of 57 economists surveyed before Federal Reserve figures on 17 Aug. (Bloomberg)

20100816 1157 Malaysia Corporate News.

BCorp to sell Inter-Pac to Kim Eng?
Tan Sri Vincent Tan, who has been actively unlocking asset values in his flagship Berjaya Corp Bhd (BCorp), is believed to be in advanced negotiations to divest part of the group’s equity stake in Inter-Pacific Securities Bhd (Inter-Pac) to Singapore-based Kim Eng holdings Ltd, sources said. An industry source said an agreement has been reached for BCorp to sell a 70% stake in Inter-Pac to Kim Eng after the latter completed the necessary due diligence. It is learnt that the deal would be in the form of cash plus a share swap, with a premium to be paid for the stock broking licence. However, details of the pricing are not known and it is believed that the parties have yet to sign on the dotted line. (Financial Daily)

Higher supply of power for peninsula
The Energy, Green Technology and Water Ministry is planning for the plant-up of an additional 2,000 MW of power, which is 400 MW higher than the amount originally sought from the Bakun dam. The Energy Commission hopes to identify the power company that will plant up an additional 1,000 MW of electricity by the end of January next year. The commission is still in the consultative process, evaluating the proposals submitted by three bidders for existing sites – Tenaga Nasional Bhd (Janamanjung), Malakoff Bhd (Tanjung Bin) and Jimah Power Sdn Bhd (Jimah). The winner of the bid has to ensure that the plant will be operational by the first quarter of 2015. The second plant can be a greenfield project which probably would take longer to plan, as it involves site investigations and compliance with environmental requirements. (Financial Daily)

DRB-Hicom’s Pekan plant to roll out 3 new VW models
Three new Volkswagen models are expected to roll out of the DRB-Hicom plant in Pekan, Pahang, thus strengthening the district’s position as a regional automotive hub. Prime Minister Datuk Seri Mohd Najib Razak said the assembly of CKD vehicle components of the renowned German brand would see the vehicles roll out of the plant by the end of first quarter of next year. He said the JV was agreed upon after his meeting with Volkswagen top officials during his overseas holiday recently. (Malaysian Reserve)

Boustead DCNS wins RM1.3bn submarine job
Boustead Heavy Industries Corp Bhd, the shipbuilding unit of conglomerate Boustead Holdings Bhd, has won a RM1.3bn contract to provide services for two Royal Malaysian Navy submarines. The six-year contract ending in November 2015, would see Boustead and its French partner, DCNS SA, provide the so-called “in service support” and spare parts as well as building the related facilities to maintain the Prime Minister Class Scorpene submarines, according to a statement from Boustead Heavy. The contract was given to Boustead Heavy’s subsidiary, Boustead DCNS Naval Corp SB, a joint venture with French defence firm, DCNS. (Malaysian Reserve)

Petra Energy wins Petronas contract
Petra Energy Bhd, through its wholly owned unit Petra Resources SB, has been awarded three work orders worth RM26.4m by Petronas Carigali SB. In a statement, Petra Energy said the orders were for the provision of hook-up and commissioning work of Petroliam Nasional Bhd’s (Petronas) offshore facilities in Sabah and Sarawak waters. It said they were for the Betty Revisit 4 Project, ERB West Development Project and SKO Pipeline Rejuvenation Project. The job had commenced on 8 April, 1 July and 22 July, respectively for varying term periods. (StarBiz)

20100816 1144 Global Market News.

Asian shares slide as Japan's growth stalls
SINGAPORE, Aug 16 (Reuters) - Asian shares fell after data showed Japan's economic growth stalled in the second quarter, adding to worries that a global recovery is quickly faltering and prompting investors to sell riskier assets.
"The GDP figures were bad, especially for what it suggests about deflation," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Morgan Stanley Securities.
GLOBAL MARKETS: Pessimism trumps data, euro and U.S. stocks fall
NEW YORK, Aug 13 (Reuters) - U.S. and German economic data looked promising on Friday, but pessimism regarding the global economic recovery pushed the euro to a three-week low and led to Wall Street's worst week in a month and a half.
"We've seen a succession of bad news this week that was punctuated by the Fed's comments, so while we have some semblance of self-sufficiency, it's clear we'll be in a slow-growth period for a long time," said Steven Baffico, senior managing director at Claymore Securities in Lisle, Illinois.

Shares, euro dip, investors lock in post-GDP gain
LONDON, Aug 13 (Reuters) - European stocks fell while the euro also slipped as assets considered to be higher risk relinquished early gains after initial euphoria from a surprisingly strong German economic growth data fizzled out.
"The broadening perception is that the strong GDP represents the peak of the bounce (in the economic recovery)," said Ashraf Laidi, chief markets strategist at CMC Markets.

U.S. jobless claims rise highlights economy's ills
WASHINGTON, Aug 12 (Reuters) - The number of U.S. workers  filing new claims for jobless benefits unexpectedly rose last week to the highest level in close to six months, the latest evidence the economy's recovery is faltering.
Thursday's data came two days after the Federal Reserve spooked investors by downgrading its assessment of the economy. The increase in jobless claims added to worries in the stock market, which has failed to make any gains this year.

German juggernaut propels euro zone GDP jump
DUBLIN, Aug 13 (Reuters) - European economic growth accelerated sharply in the second quarter of 2010 as Germany's best performance since reunification more than made up for the struggles of Spain, Ireland and recession-ravaged Greece.
A forecast-beating surge in German gross domestic product combined with a solid if less impressive rise in France to push the aggregate GDP growth rate of the 16-country euro zone to 1.0 percent from the previous quarter and past that of the United States, which is showing signs of flagging.

Shares, euro dip, investors lock in post-GDP gain
LONDON, Aug 13 (Reuters) - European stocks fell while the euro also slipped as assets considered to be higher risk relinquished early gains after initial euphoria from a surprisingly strong German economic growth data fizzled out.
"The broadening perception is that the strong GDP represents the peak of the bounce (in the economic recovery)," said Ashraf Laidi, chief markets strategist at CMC Markets.

20100816 1143 Soy Oil & Palm Oil Related News.

SGS export down 16.4% for the period 1~15 Aug 2010.
ITS export down 7.4% for the period 1~15 Aug 2010.

Soy product futures ended mixed, with soyoil regaining product share value in the soybean crush. Strength in world vegoil markets and underlying export demand forced an adjustment in the meal/oil spread relationship after Thursday's session produced strength in meal versus soyoil, analysts said. December soyoil settled 1.31 cents or 3.1% higher at 43.14 cents per pound. December soymeal ended $0.50 or 0.2% higher at $296.70 per short ton.(Source: CME)

Wilmar 2Q Net Falls As Margins Squeezed; Sees Improvement(Source: CME)
Wilmar International Ltd., the world's biggest palm oil trader by volume, unexpectedly reported a 15.4% decline in its second quarter net profit due to tighter margins and decreased valuation of convertible bonds.
Net profit for the quarter ended June 30 was $344.5 million, compared with $407.2 million a year ago, Wilmar said in a statement to the Singapore Exchange. Revenue rose 18.3%, to $6.8 billion.
Margins were lower but "satisfactory" across most business segments after significant margin enhancement in the same quarter last year following the global financial crisis, the statement said.
"Normally second half production of palm is higher. When production is higher, plants run at higher capacity, and hopefully margins will improve," chief executive Kuok Khoon Hong told reporters on the sidelines of an analyst briefing in Singapore. "I won't worry too much about quarter-to-quarter margins."
Pretax profit reported by the company's plantations and palm oil mills business declined 24% to $76.6 million mainly due to the lower average price of crude palm oil and lower yield because of wet weather in Sumatra, which affected harvesting.
Oilseeds and grains, however, logged a 47% increase in pretax profit to $145.8 million as sales grew 27%, the statement said.
"With crush margin turning more positive in China and (as) we enter the higher cooking oil demand season in the third quarter, this should benefit Wilmar. Our more positive crude palm oil outlook, supported by tighter supply-demand outlook and upside support from soybean oil, should also (help) see stronger trading gains" in the second half of the year and in 2011, J.P. Morgan said in a note to clients after the earnings were announced.

Palm oil at 15-mth top on supply worry
KUALA LUMPUR, Aug 13 (Reuters) - Malaysian crude palm oil futures hit a 15-month high on renewed concerns about weather following a pessimistic grain production report from the U.S. Department of Agriculture.
"The USDA report reignited fears of dwindling world supply," said a trader in a local commodities brokerage firm. "Production prospects are fading."

Indonesia 2010 CPO output growth to slow on rains
JAKARTA, Aug 13 (Reuters) - Crude palm oil (CPO) output from Indonesia, the world's largest producer, may grow at a slower pace of 4.5-5 percent this year as prolonged rains have affected yields, the country's palm oil association said on Friday.
Lower output from Indonesia could offer support to palm oil prices , which have gained 1.5 percent so far this year, but hurt revenues for producers such as Astra Agro Lestari  and Wilmar .

Brazil 10/11 soy crop seen down vs 09/10 - AgraFNP
SAO PAULO, Aug 12 (Reuters) - Brazil's 2010/11 soybean crop is expected to be as large as 67 million tonnes, which would be down from the record 68.5 million tonnes harvested earlier this year, analyst AgraFNP said on Thursday in its second forecast of the new crop.
Planted area is seen largely stable but the effects of drier weather over Brazil's center-south grain belt from the La Nina global weather phenomena is expected to hurt yields, said AgraFNP, which is a subsidiary of Agroinforma.