Wednesday, September 29, 2010

20100929 1815 FCPO EOD Daily Chart Study.

FCPO closed : 2698, changed : -39 points, volume : high.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : turned downward, buyer reducing exposure and taking profit.
Support : 2670, 2650, 2620 level.
Resistant : 2700, 2720, 2750 level.
Comment :
FCPO recorded decline in higher volume participation following a lower soy oil futures price triggered buyer to realise their profit and reducing exposure. Daily chart shows that market opened and continue to test lower support level closing 2 ticks below 2700 phsychological support turned resistant level formed a down bar candle with the reading suggesting correction range bound market after price opened touched above upper Bollinger and during Monday.
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.

20100929 1814 FKLI EOD Daily Chart Study.

FKLI closed : 1459, changed : +7 points, volume : low.
Bollinger band reading : side way range bound.
MACD Histrogram : getting lower, buyer seller still battling.
Support : 1458, 1445, 1425 level.
Resistant : 1470, 1485, 1500 level.
Comment :
10 points range market FKLI closed higher in relatively low volume participation following regional market that closed positively. Daily chart wise, market opened higher and traded range bound testing support and resistant formed a doji bar candle ended just little above middle Bollinger band support level. Reading still suggesting a side way range bound quiet market development ahead of the expiry date as trader switch to next month Oct 2010 contract.
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.

20100929 1248 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1462.5, changed : +10.5 points, volume : low.
Bollinger band reading : side way range bound.
MACD Histrogram : turned rising, buyer still at advantage.
Support : 1458, 1445, 1425 level.
Resistant : 1470, 1485, 1500 level.
Comment :
Higher overnight US market closed lead FKLI to opened and tested higher in low volume participation ended the first session recorded gain in sync with a positive regional market development. Hourly chart wise, market opened higher and hovering near middle Bollinger band level with the reading call for a side way range bound market testing support and resistant level.

20100929 1245 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2714, changed : -23 points, volume : high.
Bollinger band reading : side way range bound.
MACD Histrogram : getting lower, seller testing market as buyer reducing exposure.
Support : 2700, 2670, 2650 level.
Resistant : 2720, 2750, 2770 level.
Comment :
FCPO eased lower in higher volume transaction in tandem with a retracing downward soy oil futures price plus a higher projection on 2011 crude palm oil production news. Hourly chart shows that market opened below middle Bollinger band support that now turned resistant level with the reading suggesting a side way range bound market testing lower support level.

20100929 1026 Global Economics News.

South Korea: Seeks to reduce fiscal deficit in 2011
South Korea’s government plans to cut the nation’s fiscal deficit next year after an economic recovery boosted prospects for tax revenue. Total spending will rise 5.7% to 309.6 trillion won (USD269.4bn) while tax revenue will grow 8.2% to 314.6 trillion won, the Ministry of Strategy and Finance said in its budget proposal for 2011 released in Gwacheon. (Bloomberg)

Japan: Could benefit from strong yen, Aide Mizuno says
Japan should consider ways to benefit from a strong currency because the yen is likely to stay expensive against the dollar in the medium term, a government official said. “Japan should change its structure to raise living standards using the strong yen,” by encouraging overseas mergers and acquisitions and purchasing mining rights for natural resources, Kazuo Mizuno, deputy director-general of economic assessment at the Cabinet Office, said. (Bloomberg)

Japan: China's rare-earth ban would hurt, Kaieda says
China’s “de facto” ban on exports to Japan of rare earths, a group of 17 metals used in weapons, hybrid vehicles and laptop computers, may have a “big impact” on Japan’s economy, Japanese Economy Minister Banri Kaieda said. China’s Ministry of Commerce spokesman Chen Rongkai said that China has not imposed such a ban, repeating a stance he made last week, after media reports said China was restricting shipments. (Bloomberg)

UK: Growth fueled by jump in spending, investment
The UK economy’s fastest quarter of growth in nine years was fuelled by rebounding consumer spending and inventories and the biggest jump in government spending since 2008. GDP expanded 1.2% in the three months through June from the first quarter, unrevised from a previous measurement, the Office for National Statistics said in London. (Bloomberg)

US: Home prices recede as tax credit expiration hurt sales
Home prices in 20 US cities rose at a slower pace in July from a year earlier as the end of a government tax credit hurt sales. The S&P/Case-Shiller index of property values increased 3.2% from July 2009, the smallest yo- y gain since March, the group said in New York. The gauge is a three-month average, which means the July data are still being influenced by transactions in May and June that may have benefitted from the incentive. (Bloomberg)

US: Consumers lose confidence on jobs gloom
Mounting gloom over the outlook for jobs and wages caused American consumers to lose confidence in September, indicating spending will take time to recover. The Conference Board’s sentiment index declined to 48.5 this month, the weakest level since February, according to figures from the New York-based private research group. Another report showed home prices cooled, hurt by a slump in sales following the end of a government tax incentive. (Bloomberg)

20100929 1025 Malaysia Corporate News.

Selangor water issue is still uncertain
The Federal Government understands the urgency to speed up the water restructuring process in Selangor and is working towards resolving the matter, said Energy, Green Technology and Water Minister Datuk Seri Peter Chin Fah Kui. “We are taking steps to resolve this as soon as possible,” he said. “No decision had been made on water tariff hikes yet. Negotiations are still ongoing. As far as tariffs are concerned, the Government will consult and communicate with members of the public first before we talk about a hike,” Chin said. At a separate meeting, Selangor Menteri Besar Tan Sri Kahlid Ibrahim said the state “has not given permission” for any tariff hike. It is understood approval from both governments are needed for a hike to materialize. (starbiz)

Hong Leong closer to EONCap takeover
Hong Leong Bank is a step closer to taking over EON Capital (EONCap) after the latter's shareholders approved the takeover bid on Monday, group managing director Yvonne Chia said. The EGM saw 97% of EONCap's shareholders supporting the RM5.06bn offer by Hong Leong Bank to buy its assets and liabilities. Voting was done by way of poll. But the merger is not a done deal yet as it needs a decision from the court. Meanwhile, Bank Negara Malaysia has denied Ng Wing Fai a seat on the board of EON Capital (EONCap) in the latest blow to Hong Kong-based Primus Pacific Partners that is now resisting Hong Leong Bank’s takeover bid. (BT)

MAS unit, Sabena in aircraft component JV
Malaysia Airlines said its aerospace engineering unit formed a joint venture with Sabena Technics SA to provide aircraft component repair and overhaul services in Malaysia. The venture would offer avionics, electrochemical systems, fuel systems and engine components for the B737 new generation, A320 and ATR aircraft types. (Starbiz)

Proton and Fernandes fight over Lotus name
Proton Holdings, which owns British-based Group Lotus, squared up for a fight with racing team boss Datuk Seri Tony Fernandes on Monday over the right to use the evocative brand in Formula One. The Malaysian national carmaker said in a statement that it had terminated a licence for Fernandes’ 1Malaysia Racing Team to compete as Lotus Racing and would “take all necessary steps” to stop him using the Team Lotus name from 2011. Fernandes, the Malaysian entrepreneur who announced at last weekend’s Singapore Grand Prix that Lotus Racing would compete as Team Lotus next season, fired back a broadside of his own. Lotus Racing chief executive Riad Asmat said in a statement that the team had issued proceedings in the London High Court “for a declaration that Team Lotus Ventures has the rights to use the Team Lotus name and everything associated with that brand in relation to Formula One’’. (FinancialDaily)

Astro unit faces RM1.3bn suit
Low-profile television support equipment provider, AV Asia SB, yesterday filed a suit against Measat Broadcast Network Systems SB (MBNS) and another company for alleged breach of a mutual non-disclosure agreement, claiming some RM1.3bn in loss of potential profits. In its writ of summons, AV Asia alleged that MBNS, a subsidiary of Astro, had used the former’s confidential information with regard to a technical solution to transmission disruption during rain to launch its recent product, Astro B.yond high definition television. (FInancialDaily) 

20100929 0912 Global Market News.

OIL: Crude gains as U.S. stockpiles drop
SINGAPORE, Sept 29 (Reuters) - Oil rose on Wednesday after an industry report showed crude and winter fuel stockpiles declined last week in top-consumer the United States, reducing a surplus that has weighed on market sentiment for months.
U.S. inventories of distillates, a fuel category that includes heating oil and diesel, unexpectedly dropped by 2.8 million barrels in the week to Sept. 24, pulling stockpiles 3.5 million barrels below year-ago levels, the American Petroleum Institute (API) reported late on Tuesday.

COMMODITY MARKETS: Gold extends record high streak, grains dive
NEW YORK, Sept 28 (Reuters) - A sliding dollar on Tuesday helped gold extend a record-setting streak that has seen the shiny metal gain nearly 20 percent this year and buoyed other commodities by discounting them for non-U.S. investors.
"The dollar falling has money fleeing into anything (such as) gold, energy," said Richard Ilczyszyn senior market strategist at Lind-Waldock in Chicago.

GLOBAL MARKETS: Dollar, pound fall, gold up on stimulus hopes
NEW YORK, Sept 28 (Reuters) - The U.S. dollar and the British pound fell against the euro on Tuesday as speculation rose those countries' central banks would provide more stimulus to their economies, which sent gold to record highs.
"For lack of a better term, it really is a 'classic QE day,'" said Tom Fitzpatrick, chief technical strategist at Citigroup in New York. "Bonds rally, equities rally, the dollar goes down and gold hits new highs. At this point, that is what's driving the markets."
PRECIOUS-Gold falls off record as dollar recovers
LONDON, Sept 28 (Reuters) - Gold fell on Tuesday as a recovery in the U.S. dollar weighed and as investors took profits after bidding the metal up to a record $1,300 an ounce in the previous session.
Silver was off a 30-year high, while platinum and palladium tracked stock markets lower.

FOREX-Euro recovers as dollar selling resumes
LONDON, Sept 28 (Reuters) - The struggling dollar slipped on Tuesday after a brief rally ran out of steam, while the euro recovered after a senior official said some European Central Bank emergency support may be withdrawn.
Traders also ascribed the dollar's drop to reported comments from a former Chinese central bank adviser who said a devaluation of the U.S. currency may be inevitable.

World stocks stabilise; euro firms after Stark
LONDON, Sept 28 (Reuters) - World stocks held steady on Tuesday as euro zone banking concerns offset optimism on the corporate sector, while the euro rose after a European Central Bank official pointed to the withdrawal of support measures next year.
The premium investors demand to hold Irish or Portuguese government bonds hit euro lifetime highs after Standard & Poor's warned it may cut Ireland's credit rating if the country poured more than 35 billion euros into Anglo Irish Bank.

20100929 0911 Soy Oil & Palm Oil Related News.

Soy product futures stumbled, backpedaling in unison with soybeans. Soyoil futures inched lower, retreating in late dealings after holding firm for most of the day. Strong export demand and fears of tightening world vegoil supplies was an underpinning feature in soyoil futures, said Bill Nelson, analyst with Doane Advisory Service. Soyoil gained product share versus soymeal on spreads, as the availability of soybeans for crushing is seen alleviating any near term soymeal supply tightness, analysts said. December soyoil settled 0.04 cents or 0.1% lower at 44.93 cents per pound. December soymeal ended $7.20 or 2.3% lower at $308.50 per short ton. (Source: CME)

eBio: High Grain Prices To Hit EU Biofuels Sector (Source: CME)
The European Union's burgeoning biofuels sector could suffer if grain prices stay high for too long, the head of a trade body representing European bioethanol said. Rob Vierhout, Secretary-General of the European Bioethanol Fuel Association, or eBio, said a recent surge in the price of grains such as wheat, which bioethanol refiners process to make fuel alcohol, could lead to some plants shutting down. "It could well mean that some companies stop producing because the raw material is such a substantial part of production costs--up to 70% with grain at the level it is now," he said. Ethanol prices in the EU have increased significantly in the past year. According to figures from analyst FO Licht, European ethanol prices in Rotterdam on a free-on-board basis last week were at EUR620 to EUR640 a cubic meter, up around EUR100 from the same time last year.
Vierhout attributed part of the increase to a surge in world grain markets, which have seen prices spike in recent weeks after Russia--the world's third-largest wheat exporter--banned grain exports for up to a year. Europe's biofuels sector has expanded rapidly in recent years. Fuel ethanol production in the 27-nation bloc rose by 31% in 2009 to 3.7 billion liters, stoked by targets to reduce EU greenhouse gas emissions by 50% compared with fossil fuels by 2017. Demand for bioethanol--which can be mixed with gasoline to create a cleaner form of fuel--is also rising. Last year, the EU consumed 4.3 billion liters, up from 3.5 billion the previous year, an increase of 23%. But Vierhout said he doesn't expect expansion to increase as demand struggles to keep pace with supply. He estimates that this year the sector will see a 3 billion-liter overcapacity as production from existing projects increases and new plants come on line.

Nomura: Higher Palm Oil Output Next Year To Ease Prices (Source: CME)
An increase in palm oil production in Indonesia and Malaysia by about 2 million metric tons in 2011 will likely ease palm oil prices to an average MYR2,500 per metric ton, Nomura Securities' plantation analyst Ken Arieff Wong said. Speaking at a media roundtable during its annual Asia Agri & Food Day, Ken said Nomura has maintained the neutral rating on palm oil with futures prices averaging MYR2,500/ton and spot prices hovering around MYR2,570/ton in 2011, if crude oil averages $95 per barrel. Prices are expected to ease tracking ample global supply of soybeans against the backdrop of a bumper harvest in South America and a likely record harvest in the U.S, said Tanuj Shori, Nomura's soft commodities and supply chain analyst. Only a small portion of this year's soybean crop has been crushed so far and ample remaining stocks will also help ease the pressure on prices, he said.
"Some of the refiners in India have switched to soy-oil from rival palm oil," because of the narrowing price difference between the two, he said. However, the trend could change next year when palm oil prices ease. Crude palm oil production in Indonesia, the largest producer globally, is likely to reach 23.9 million tons in 2011, up 8% from the estimated 22.2 million tons this year because of increased mature acreage and a general improvement in yields, said Wong. That's above the 22.5 million tons estimate given by leading vegetable oils analyst Dorab Mistry during an oilseeds conference in Mumbai over the weekend. Yields tend to move in cycles, where periods of lower yields are usually followed by higher yields, Wong said.

Gain on Asian demand outlooks
JAKARTA/KUALA LUMPUR, Sept 28 (Reuters) - Global vegetable oil markets edged higher on Tuesday as investors bet on strong holiday demand from China and India.
Concerns that erratic weather will curb production of soybeans in South America and China as well as Canadian canola are also underpinning agriculture markets.

Indonesia 2011 palmoil output growth at 10 pct-Nomura
SINGAPORE, Sept 28 (Reuters) - Indonesia's crude palm oil output is expected to grow as much as 10 percent in 2011, compared with 5 percent estimated this year, due to improving yields in the world's top producer, Nomura said on Tuesday.
"A 5 percent growth is at best in 2010 because there are downside risks if the yields don't recover in the second half of 2010," Ken Arieff Wong, research analyst at Nomura Securities Malaysia, told a media briefing.

Philippines' 2010 coconut oil exports seen up 57 pct
MANILA, Sept 28 (Reuters) - The Philippines' coconut oil exports are expected to grow 57 percent to around 1.3 million tonnes this year on improving demand and output, up from a previous estimate of 21 percent growth, an industry group said on Tuesday.
Earlier this year, the United Coconut Associations of the Philippines (UCAP) had projected the country's 2010 exports of coconut oil would hit 980,000 tonnes, from 808,007 tonnes in 2009.