Wednesday, October 20, 2010

20101020 1826 FCPO EOD Daily Chart Study.

FCPO closed : 2982, changed : +65 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : weakening, buyer taking profit.
Support : 2970, 2930, 2900 level.
Resistant : 3020, 3050, 3070 level.
Comment :
FCPO rallied breaking new high recorded substantial gains with sustaining volume transaction traded after both export cargo surveyor recorded improved export figures. Wide range up bar candle daily chart spike up after few days of correction marching toward upper Bollingner band resistant level with the reading turned to suggesting a further upside biased market development.
When to buy : buy at support and weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20101020 1738 FKLI EOD Daily Chart Study.

FKLI closed : 1491, changed : +1 point,  volume : higher.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : recovering, buyer still supporting market.
Support : 1485, 1470, 1458 level.
Resistant : 1500, 1530, 1550 level.
Comment :
Opened gap down FKLI managed to recover all intraday losses and recorded minor gain with increasing volume transaction traded despite a stronger US Dollar, a negative major US corporate result like Apple and Bank of America plus a surprise interest rate hike announcement by China official. Daily chart formed a wide range bar after market gap down by 9.5 points, tested below middle Bollinger band support level a recovered upward with the reading adjusted to suggesting a correction range bound upside biased.
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.

20101020 1100 Local & Global Economics News.

Malaysia: 6.5% GDP forecast on slower exports, imports, BCI
The Malaysian Institute of Economic Research (MIER) is maintaining its GDP forecast of 6.5% this year. Its executive director, Dr Zakariah Abdul Rahid, said this was based on slower growth in imports and exports as well as the decline in business condition index (BCI) in the third-quarter of this year, which more than offset the surge in consumer sentiment index (CSI). (Malaysian Reserve)

Malaysia: To get greater access to India for palm oil, cocoa
Malaysia said it expects to conclude talks with India on a free-trade agreement next week that should see it obtain greater access for products including cocoa and palm oil as well as more stringent anti-dumping provisions. “Everything has been agreed,” International Trade & Industry Minister Mustapa Mohamed said in Kuala Lumpur. “India is a big market, growing fast.” (Bloomberg)

China: Surprises with first rate hike since 2007
China's central bank surprised with its first increase of interest rates in nearly three years, a move that reflects its concern about rising asset prices and stubborn inflation. It said it was raising benchmark rates by 25 basis points, taking one-year deposit rates to 2.5% and one-year lending rates to 5.56%. The impact was felt by global markets when oil prices fell, European stock markets turned and the dollar rose. (Bloomberg)
Japan : Cuts its economic evaluation for first time in 20 months
Japan’s government downgraded its assessment of the economy for the first time in 20 months as a rising yen and slower global demand put increasing pressure on an already slowing export-led expansion. The rebound is “pausing,” the Cabinet Office said in Tokyo, removing last month’s reference to the economy “picking up.” (Bloomberg)

UK: Some UK inflation indicators ‘extremely subdued’, King says
Bank of England Governor Mervyn King said that some gauges of UK inflation are “extremely subdued,” signaling that he may be open to stepping up bond purchases. Officials are “conscious that the continuing high level of inflation poses the risk that inflation expectations may move up,” King said in England. "Still, the danger that slack in the economy will push price-growth below the bank’s target is “at least as large.” (Bloomberg)

UK: More BOE stimulus may be ‘misplaced’, Barker says
The Bank of England risks stoking inflation with little benefit to economic growth if it expands its so-called quantitative easing program of stimulus, former policy maker Kate Barker said. “If rising inflation expectations have followed the use of QE, there is a risk that relying on monetary policy to ride to the rescue of faltering growth might be misplaced,” she said. "More stimulus could “have more of an impact on inflation than on growth if it feeds through into higher inflation expectations.” (Bloomberg)

US: Housing starts unexpectedly rise to five-month high
Builders in the US unexpectedly began work on more homes in September, a sign the real estate market was stabilizing at depressed levels heading into the recent upheaval in the foreclosure crisis. Housing starts rose to a 610,000 annual rate, the most since April and up 0.3% from a revised 608,000 rate in August that was higher than previously estimated, Commerce Department figures showed in Washington. (Bloomberg)

20101020 1058 Malaysia Corporate News.

US stocks drop on China, bank worries
US stocks fell sharply Tuesday, sending the Dow to its worst day in two months, as investors became unnerved by a surprise rate hike in China, disappointing earnings, and fresh concerns about the impact bad mortgages could have on banks. The Dow sank 165.07 points, or 1.5%, to 10,978.62, ending below 11,000 for the first time in more than a week. (MarketWatch)
TA Global clinches RM1.8bn property JV in Australia
TA Global Bhd is expanding its presence in Australia via a 50:50 “development sponsorship arrangement” with Charter Hall Group for the RM1.8bn Little Bay residential development project in Sydney. The project, which has approximately 570 dwellings, is expected to be undertaken in stages. (Financial Daily)

AirAsia 3Q passenger traffic grows 26.6%
AirAsia grew passenger traffic by 26.6% for the third quarter of 2010, compared with the same quarter a year ago. Passenger capacity grew by 11.1% as the airline carried 4m passengers, or 12.4% more in the third quarter of 2010, compared with a year ago. (BT)

Association tells glove makers to up prices
The Malaysian Rubber Glove Manufacturers’ Association, whose members collectively supply 60% of the global rubber latex glove consumption, advised its members to raise glove prices in line with high raw material costs and continued weakening of the US dollar. (Financial Daily)

Muhibbah lands RM206m job
Muhibbah Engineering has secured a RM206m contract from Putrajaya Holdings SB to design and build as well carry out external works at the federal administrative centre in Putrajaya. The contract was expected to commence this year and be completed in 2013. (Financial Daily)

Bina Puri accepts RM82m Ipoh project
Bina Puri has signed a letter of acceptance from Superboom (Perak) SB to undertake a project to build 3 blocks of apartments at Ipoh, Perak for The Haven SB for RM82m. the project is targeted for completion n 2013. (Financial Daily)

CIMB Thai 3Q profit dives on higher provisions
 CIMB Thai, a 93.2%-owned unit of CIMB Group, saw its net profit plunge 61% y-o-y to THB179.6m for the third quarter ended 30 Sept, 2010. The sharp drop was partly due to the 23% rise in provision for non-performing loans from THB138m to THB171m. (Financial Daily)

Higher expenses hit Bursa Malaysia 3Q earnings
Bursa Malaysia’s 3QFY10 net profit fell by 10% from a year ago to RM27.7m as higher expenses took the shine off its improved trading revenue. This was on the back of a slight increase in revenue to RM86.8m from RM86.3m. (BT)

20101020 1011 Global Market News.

Oil rebounds as reaction to China rate hike seen overdone
SINGAPORE, Oct 20 (Reuters) - Oil rebounded in reaction to the previous session's activity, when it racked up the biggest drop since February after China surprised markets by raising interest rates for the first time in nearly three years. "It seems to me there was a very knee-jerk reaction to the China move across all commodities, and now people are starting to step back and think about what it actually means for Chinese growth," said Yingxi Yu, a Singapore-based commodities analyst with Barclays Capital.

Gold steady after sharp fall, bargain-hunting seen
SINGAPORE, Oct 20 (Reuters) - Gold held steady, after falling nearly three percent in the previous session following China's surprise interest rate hike, and prices are supported by bargain-seekers.
"In the short term, gold will be under pressure, as investors switch over to the dollar from commodities. In addition, some investors have chosen to close their positions after sizeable profit," said Hou Xinqiang, an analyst at Jinrui Futures in China.

Asia stocks slide after China rate rise
SINGAPORE, Oct 20 (Reuters) - Asian stocks fell with Japan's Nikkei average tumbling over 2 percent, as investors fretted that China may be embarking on a policy tightening cycle after it surprised with its first interest rate rise since 2007.
"It is not clear whether the central bank will start on a process of additional rate increases under the pressure of asset price bubbles and hot money inflows, but this signal shows that the government is clearly concerned about escalating inflation and rising real estate prices," said Guo Yanling, analyst at Shanghai Securities.

PRECIOUS-Gold holds near $1,370/oz, eyes Fed for QE clues
LONDON, Oct 19 (Reuters) - Gold held steady near $1,370 an ounce in Europe on Tuesday as expectations for further monetary easing in the United States continued to support prices, though gains in the dollar put the brakes on the metal's run higher.
"Gold is not going to move much lower when you have the FOMC ahead of us in early November, the G20 preparations later this month and the full summit next month," said Credit Agricole analyst Robin Bhar.

FOREX-Dollar ekes out modest gains, data supports euro
LONDON, Oct 19 (Reuters) - The dollar gained on a basket of currencies for a third straight session on Tuesday, backed by worries among some players that the monetary easing expected from the U.S. Federal Reserve next month is largely priced in.
"Comments from Geithner and a reversal in short dollar positions is pushing it higher," said Gareth Berry, currency strategist at UBS, Singapore. "But this will not last too long with many waiting to see what the Fed will do next month."

US dollar up for 3rd day; Asia stocks mixed
HONG KONG, Oct 19 (Reuters) - The U.S. dollar edged higher for a third consecutive day, driven by traders continuing to take profits on gains in other currencies, while weakness in the technology and commodity sectors limited gains in Asian stocks.
"The reasons for the dollar being weaker, principally that move towards QE, are still very valid, so any pullbacks are not going to be enormous," said Gregg Gibbs, currency strategist with Royal Bank of Scotland in Sydney.

20101020 1006 Soy Oil & Palm Oil Related News.

ITS : CPO export up 4.2% at 944,700 tonnes for the period of 1~20 Oct 2010.
SGS : CPO export up 5.4% at 929,473 tonnes for the period of 1~20 Oct 2010.

Soy product futures ended lower in unison with broader commodity markets, falling prey to speculative selling in the face of a strong bounce in the U.S. dollar. Soymeal, despite the declines, was the stronger of the products, benefiting from soyoil's weakness on spreads, analysts said. December soyoil settled 0.56c, or 1.2%, lower at 47.10 cents per pound. December soymeal ended 0.10c, or 0.03%, lower at $328.20 per short ton. (Source: CME)

Madhya Pradesh 2010-11 Soybean Output Likely Up 5% - Official (Source: CME)
Soybean output in central India's Madhya Pradesh, the country's largest producing state, is likely to rise 5% to 6.73 million metric tons in the marketing year through September 2011 as good rains have increased the yield, a senior government official said. The state produced about 6.40 million tons of soybeans in 2009-10, the official, who didn't want to be named, told Dow Jones Newswires on the sidelines of a conference. The area under soybean cultivation is expected at 5.35 million hectares, the same as last year, the official said. According to the Soybean Processors Association, soybean output in all of India is likely to rise 4.2% to 10.13 million tons this year.
The official added that Madhya Pradesh is likely to produce 3.88 million tons of chickpeas in 2010-11, up 17.6% from 3.30 million tons last year thanks to a larger area under cultivation. The area under chickpea is expected at 3.15 million hectares this year, up 2% from 3.09 million hectares last year, he said. Madhya Pradesh is the country's biggest producer of chickpeas.

Palm oil rises; gains curbed by dollar, stocks
KUALA LUMPUR, Oct 19 (Reuters) - Malaysian palm oil rose along with other vegetable oil markets, although a firmer U.S. dollar and concerns of growing stocks weighed on prices.
"Market sentiment is depressed by the fact that production may be 15-20 percent higher and exports will not grow at the same pace," said a trader in Singapore.

US corn, soy harvest continues at record pace
CHICAGO, Oct 18 (Reuters) - The U.S. corn and soybean harvest continued at a record pace as largely dry weather in the top growing region of the Midwest allowed farmers to maintain the fastest harvest since the U.S. Agriculture Department began tracking the data in 1981.
The corn harvest was 68 percent complete as of Sunday, up from 51 percent last week and the five-year average pace of 39 percent, USDA said late on Monday.

Brazil soy growers sell 23 pct of new crop-Celeres
SAO PAULO, Oct 18 (Reuters) - Brazilian soybean producers have sold 23 percent of the 2010/11 soybean crop that farmers have just recently started to plant, up from 20 percent a week earlier, analysts Celeres said on Monday.
As of Oct. 15, sales of the new crop, which is seen at a record 69.1 million tonnes, were ahead of the 16 percent sold this time last year. Celeres said forward sales were just ahead of the 21 percent sold on average over the last five years at this period.

EU ups soyoil imports on biofuel demand -Oil World
HAMBURG, Oct 19 (Reuters) - The European Union is raising its soyoil imports to meet demand for biofuel output and because of tighter rapeoil supplies after a poor rapeseed crop this summer, Hamburg-based oilseeds analysts Oil World said on Tuesday.
"We estimate that the EU-27 (member states) will import approximately 420,000-450,000 tonnes of soyoil in July/Dec. 2010, virtually double the 228,000 tonnes a year earlier," Oil World said.