Monday, November 1, 2010

20101101 1851 FCPO EOD Daily Chart Study.

FCPO closed : 3092, changed : +31 points, volume : higher.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : weakening, buyer taking profit.
Support : 3070, 3050, 3020 level.
Resistant : 3100, 3150, 3200 level.
Comment :
Hit new high FCPO traded firmer recorded gain with slightly better volume changed hand despite a disappointing slower Oct 2010 export data released today as soy oil futures price continue to trade firmer after US Dollar getting weaker. Daily chart formed a doji bar candle closed near the high of the day just few points away form the 3100 resistant level with the reading suggesting a correction range bound upside biased market development for the near term.
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.

20101101 1822 FKLI EOD Daily Chart Study.

FKLI closed : 1514, changed : +9 points,  volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : getting higher, buyer still rule.
Support : 1500, 1485, 1470 level.
Resistant : 1530, 1550, 1580 level.
Comment :
FKLI traded firmer recorded gain and new high closing near the high of the day with better volume transacted in unison with major regional positive market doing 5 points premium compare to cash market. Daily chart formed a doji bar candle above the upper Bollinger band level after market opened gap up and traded within a 6 points range market with the reading suggesting an upside biased market development with possibly pullback correction.
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.

20101101 0855 Global Economics News.

US: White House considering new tax cut plan, Washington Post says
The Obama administration is considering a plan that would preserve tax breaks for both the wealthy and the middle class as it faces likely Democratic losses in the 2 Nov mid-term elections, the Washington Post reported. Administration officials are discussing “decoupling” the Bush-era tax cuts to allow permanent extension for families making less than USD250,000 a year and temporary extension of cuts for those making more, the newspaper said, citing people familiar with talks at the White House and among senior congressional Democrats. (Bloomberg)

US: Unemployment probably hovered near 10%
Unemployment in the US probably kept hovering near 10% in October, one reason the recovery that began more than a year ago has disappointed Federal Reserve policy makers, economists said before a report this week. The jobless rate held at 9.6% for a third month, according to the median of 61 estimates in a survey heading into a 5 Nov report from the Labor Department. (Bloomberg)

U.S: GDP grew at an annual rate of 2% QoQ in 3Q10 underscoring the views of Federal Reserve policy makers who say more stimulus will be needed to spur growth. (Source: Bloomberg)

U.S: Michigan consumer sentiment index declines in October. The Thomson Reuters/University of Michigan final index of consumer sentiment decreased to 67.7 from 68.2 in September. (Source: Bloomberg)

U.K: Consumer confidence unexpectedly rose in October as sentiment held up before Prime Minister David Cameron's government unveiled the scope of its budget squeeze, GfK NOP Ltd. said. The index of sentiment increased 1 point to minus 19. (Source: Bloomberg)

E.U: Inflation unexpectedly accelerated in October to 1.9% YoY after increasing 1.8% YoY in September. The jobless rate was 10.1% in September, the highest since July 1998, a separate report showed. (Source: Bloomberg)

Germany: Retail sales unexpectedly dropped for a second straight month in September. Sales, adjusted for inflation and seasonal swings, fell 2.3% MoM from August, when they declined 0.4% MoM. (Source: Bloomberg)

Spain: Jobless rate unexpectedly fell for the first time in more than three years. The unemployment rate fell to 19.8% in the third quarter, from 20.1% in the previous three months, the National Statistics Institute said.

S. Korea: Inflation rate in October climbs to 20-month high. The consumer price index rose 4.1% YoY in October accelerating from a 3.6% YoY advance in September. Prices rose 0.2% MoM from September. (Source: Bloomberg)

Singapore: Employers expanded payrolls for a fifth consecutive quarter, pushing the jobless rate to the lowest in 2 ½ years. The city state added an estimated 24,100 jobs in the three months ended September, after the creation of 24,900 positions in the second quarter of 2010, the Ministry of Manpower said in a statement. The seasonally adjusted unemployment rate fell to 2.1% from 2.2% the previous quarter. (Source: Bloomberg)

Japan: Output slide, deepening deflation point to economic slump
Japanese factory production slumped by more than double the pace economists forecast and deflation deepened in September, adding to signs that a stronger yen is causing the economy’s expansion to lose momentum. Industrial output fell 1.9% in September from August and core consumer prices declined 1.1% from a year earlier after a 1% drop in August, government reports showed. The median forecast of 27 economists surveyed was for output to drop 0.6%. (Bloomberg)

Indonesia: Prepares options for capital controls as rupiah rises. Indonesia's central bank is assembling options including a longer withholding period for foreign purchases of central bank bills if needed to address any capital inflows that risk destabilizing the nation's economy. Scenarios being studied include extending the holding period for central bank notes, or SBI to three months from one, Perry Warjiyo, director for monetary policy at Bank Indonesia, said in Jakarta. Warjiyo reiterated the central bank's view that no further limits on capital flows are currently needed. (Source: Bloomberg)

Australia: Manufacturing contracted for second month in October as the nation's surging currency eroded demand for exports. The performance of manufacturing index increased to 49.4 from 47.3 a month earlier. A number below 50 indicates contraction. (Source: Bloomberg)

20101101 0853 Malaysia Corporate News.

Kumpulan Jetson director seeking legal advice against removal
Chow Chee Kin, the director at Kumpulan Jetson Bhd who was recently asked to vacate his position, says he is seeking legal advice on the matter. “I am talking to my lawyers. I am still figuring out on what grounds are they dismissing me,” he told StarBizWeek. There were calls to remove Chow from the board of the construction outfit last week, believed to be initiated by managing director Datuk Teh Kian An, seen as the head of one of the two camps within the company. Chow said he was served a letter of termination on 8 Oct. When contacted, Teh declined comment. Last Friday, Jetson announced to Bursa Malaysia that it would convene an EGM on 29 Nov to remove Chow as director. (StarBiz)

Cheaper Toyota Prius
UMW Toyota Motor has slashed the price of Toyota Prius by 20% to RM139,900 following the tax-free incentive on hybrid cars announced recently. The Prius price in Sabah and Sarawak is RM141,500 owing to the higher logistics costs, UMW Toyota said in a statement. The Prius was originally sold at RM175,000 (including insurance). UMW Toyota president Kuah Kock Heng said the move was in line with the Government's move in extending better tax incentives to hybrid cars under the 2011 Budget. "Compared to the 2009 Budget, the 2011 Budget extends full exemptions of import duty and 50% reduction in excise duty on hybrid cars," he said. (BT)

VW hopes to conclude talks with DRB-Hicom by year-end
Europe’s biggest vehicle manufacturer Volkswagen Group hopes to conclude negotiations with DRB-Hicom Bhd on the proposed partnership to produce Volkswagen vehicles in Malaysia by year-end. Volkswagen Group Malaysia SB managing director Andreas Prinz said that so far, the negotiations were promising with several working groups looking at different aspect of the venture – the production, government incentive and product feasibility. (Malaysian Reserve) 

CIMB: Represents Malaysia in deal with China. CIMB Group (as the representative bank for Malaysia) along with other major Asean financial institutions, have signed a framework agreement with the China Development Bank Corp (CDBC) to set up the China-Asean Interbank Association (CAIBA). CAIBA was set up to achieve a mutually-beneficial social and economic development between China and Asean by promoting mutual trade and investment. It can provide relevant financial services for infrastructure construction and other projects supported by the governments of China and Asean countries. Initial members of CAIBA consist of renowned financial institutions which have influence in their own countries, as well as in South-East Asia. (Source: The Star)

IOI Corp: Chairman sees CPO hitting RM3,300, to expand palm oil ops in China. IOI Corp Bhd group executive chairman Tan Sri Lee Shin Cheng said the wet weather caused by the La Nina phenomenon will likely push crude palm oil (CPO) futures to RM3,300 per tonne by 1Q2011. Lee said that RM3,400 is possible if La Nina sets in and current CPO futures had not taken the weather into consideration yet. Separately, IOI Corp Bhd is looking to expand into China's downstream business of palm oil when the timing is right. As at June 30, the group has four refineries with a total refining capacity of approximately 3.7m tones. (Source: The Edge Financial Daily, The Star)

Sunway REIT: Shops for RM500m deals to expand. Sunway Real Estate Investment Trust (REIT), the largest property trust in Malaysia is shopping for assets worth at least RM500m each in a quest to double its size within the next five years. The focus would be in the retail sector, where shopping malls and commercial properties stand to gain the most from a growing local economy. Sunway REIT has also identified properties owned by parent Sunway worth RM2.5b to be injected into the REIT over the course of seven years. (Source: The Malaysian Reserve)

Tenaga: Looks at Mid-East market. Tenaga's move overseas could likely bring back a spark of investor interest. According to industry sources, the national power provider could secure a deal in the Middle East by as early as year-end. According to reports, Tenaga is close to securing the rights to build a new combined cycle gas turbine in Egypt together with a local Egyptian partner. Tenaga is also bidding for plants in Saudi Arabia. (Source: The Edge Financial Weekly)

UBG: Today is UBG's last trading day. Today is the last trading day for UBG Bhd prior to its suspension tomorrow and subsequent delisting from Bursa Malaysia that will wipe out market capitalisation of more than RM1.2b (as of Friday). Javace Sdn Bhd and Sheikh Tarek Essam Ahmad Obaid had earlier launched a take-over and now hold 90.09% of the issued and paid-up share capital of UBG. Javace Sdn Bhd, which is wholly owned by PetroSaudi International Ltd, Seychelles, and PetroSaudi CEO Sheikh Tarek had in last December offered to acquire all voting shares in UBG not already owned by Javace and parties acting in concert with it for RM2.50 per offer share. (Source: The Star)

Consumer: New moves over hypermarket stakes. The potential purchase of stakes in two major hypermarkets under a partnership between government-linked investment companies (GLICs) and local retailers is being studied, according to the Economic Transformation Programme (ETP) report. This forms part of the initiative to facilitate local businesses to acquire stakes in foreign retail businesses. Interested parties are already speaking to funds and banks on the next step. (Source: Business Times)

20101101 0842 Global Market News.

Oil rises on weaker dollar, expectations for Fed stimulus
PERTH, Nov 1 (Reuters) - Oil rose to nearly $82, buoyed by expectations that the U.S. Federal Reserve will commit to a new round of monetary stimulus this week and prompt further weakness in the dollar.
"The market is looking forward to the stimulus, or quantitative easing," said Jonathan Barratt, managing director of Commodity Broking Services in Sydney.

China to unveil 5-yr energy plan in March earliest-media
BEIJING, Nov 1 (Reuters) - China's energy plan for the five years from 2011 to 2015 will be published in March at the earliest, a senior government official was quoted as saying, as market watchers were looking for details how China would power its fast economic expansion.
The plan would be unveiled only after the disclosure of an overall plan for national economy, the Economic Observer reported on its website (, citing Wu Yin, deputy administrator of the National Energy Administration.

Global energy supplies may not tighten -Singapore PM
SINGAPORE, Nov 1 (Reuters) - Hopes of new energy supplies such as unconventional gas may help to meet growing demand globally, Singapore Prime Minister Lee Hsien Loong said on Monday.
"Time and again experts have warned that oil and gas deposits will soon be depleted," he said at the Singapore Energy Summit.

US corn rallies for 6th session on weather, dollar
SYDNEY, Nov 1 (Reuters) - U.S. corn futures rallied for the sixth straight session, rising more than 1.25 percent to hit a 26-month high as wheat strengthened on weather concerns and the dollar remained weak.
"There's expectations of dryness to continue across the U.S. central plains over the next 10 days which is raising some concerns about the quality of the (U.S.) wheat crop as it enters its winter dormancy period," said Mathews.

Indonesia's 2010 rice output seen rising 2.47 pct
JAKARTA, Nov 1 (Reuters) - Indonesia's rice production is expected to  rise 2.47 percent to 65.98 million tonnes of unmilled rice this year, from 64.39 million tonnes in 2009, the state statistics bureau said on Monday.

China to sell more sugar reserves if needed-NDRC Official
BEIJING, Nov 1 (Reuters) - China will sell more sugar reserves to meet market demand and curb rapidly rising prices if needed, an industry web site cited an official from the country's economic planner was quoted as saying Monday.
The government has considered moves to strengthen its intervention in the sugar market to guarantee supplies, said Liu Xiaonan, a deputy chief of economic and trade department under the National Development and Reform Commission, according to the Guangxi Sugar Website.

China says no "significant" cut for rare earth quotas
BEIJING, Nov 1 (Reuters) - China's rare earth export quotas for 2011 will not be cut "significantly" from recent levels, a commerce official said on Monday, adding to Beijing's efforts to soothe foreign companies and governments worried about supply.
A Chinese Vice Minister of Commerce, Chen Jian, made the comments at a news conference following weeks of international jitters about whether China could use its hold on 97 percent of global rare earths production to sharply curtail exports of the metals, which are used for many high-tech applications.

OIL: Crude rises toward $82 as weaker dollar supports
TOKYO, Nov 1 (Reuters) - U.S. crude futures on Monday rose towards $82 a barrel on support from a weaker dollar against the yen, regaining some ground after falling nearly 1 percent late last week on sluggish U.S. economic data.
The U.S. economy grew at a 2.0 percent annual rate, up from 1.7 percent in the second quarter, the government said on Friday, in line with expectations but not enough to reduce high unemployment.

COMMODITY MARKETS: Investors cash in ahead of pivotal macro week
SINGAPORE, Oct 29 (Reuters) - Commodities pushed lower on Friday, paring some of October's gains on uncertainty surrounding the form and size of Federal Reserve liquidity injections expected after the central bank meets next week.
"It's turned into wait and see. There are mixed messages about quantitative easing so the sentiment ebbs and flows," said Mark Pervan, senior commodities analyst at ANZ in Melbourne.

GLOBAL MARKETS: Bonds rally, dollar slips before eventful week
NEW YORK, Oct 29 (Reuters) - Bond prices jumped and the dollar eased on Friday after data showed the U.S. economy grew in the third quarter but not briskly enough to alter expectations of Federal Reserve monetary easing next week.
"We're going to be in a prolonged period of relatively low interest rates," said James Sarni, managing principal and senior portfolio manager at Los Angeles-based Payden & Rygel, with $55 billion in assets under management.

U.S. growth seen up in Q3, but still slack
WASHINGTON, Oct 29 (Reuters) - U.S. economic growth likely edged up in the third quarter but not enough to chip away at high unemployment or change perceptions of more monetary easing from the Federal Reserve next week.
A government report on Friday is expected to show gross domestic product expanded at a 2.0 percent annual rate as consumer spending accelerated and the trade deficit narrowed, compared with a 1.7 percent pace in the second quarter, according to a Reuters survey.

PRECIOUS-Gold dips as dollar firms ahead of U.S. data, Fed
LONDON, Oct 29 (Reuters) - Gold eased in Europe on Friday as the dollar rose against a currency basket ahead of U.S. growth data later in the session, but traders remained cautious ahead of a hotly anticipated Federal Reserve policy meeting next week.
"The Fed meeting next week has been dominating the markets," said Standard Bank analyst Walter de Wet. "Ahead of that, people have positioned themselves, and from an investment perspective they are not going to add too much more gold.

FOREX-Yen gains as equities slip, high-yielders fall
LONDON, Oct 29 (Reuters) - The yen rose to within sight of its 1995 record high versus the dollar on Friday, rising broadly as equity markets fell, pushing down the euro and high yielders in trade made choppy by month-end flows.
"The yen is outperforming on risk-aversion following the Japanese data," said Manuel Oliveri, currency strategist at UBS in Zurich.

Wheat slips after 5-day rally, corn eyeing best month
SINGAPORE, Oct 29 (Reuters) - U.S. wheat futures edged lower as investors locked in gains after a five-session rally fed by concerns that weather problems in the United States and Australia will cut production.
"China has rampant food inflation that they're trying to keep under control, so it's a difficult situation whereby they would be looking to build reserves but also keep prices under control," said Adam Davis, senior commodity analyst at Merricks Capital in Melbourne.

Fed QE guessing game weighs on world stocks
LONDON, Oct 29 (Reuters) - World stocks fell and the dollar slid towards its 1995 record low versus the yen as investors braced for U.S. growth data to assess the likely scale of fresh Federal Reserve monetary easing.
"There is uncertainty ahead of the Fed statement for sure," said Bernard McAlinden, investment strategist at NCB Stockbrokers in Dublin.

20101101 0840 Soy Oil & Palm Oil Related News.

ITS : CPO export down 8.5% at 1,354,128 tonnes for the period of 1~31 Oct 2010.
SGS : CPO export down 12% at 1,316,908 tonnes for the period of 1~31 Oct 2010. 

Soy product futures ended mixed, with soyoil stumbling on end of month profit taking, large inventory forecasts and spillover weakness from crude oil futures. Soymeal held firm throughout the day, buoyed by strength in feed grains the unwinding of oil/meal spreads, analysts said. Dec soyoil settled 0.40c or 0.8% lower at 49.30 cents a pound. December soymeal ended $1.40 or 0.4% higher at $337.70 a short ton. (Source: CME)

Rain Boosts Delayed Planting In Brazil's Top Soy Region (Source : CME)
Widespread rain in Brazil's top soy-producing region is giving a boost to delayed planting of the new 2010-11 crop. Planting in late September and early October was delayed in many areas of Brazil's center-west soy belt that includes Mato Grosso, the country's top soy-producing state, due to insufficient rainfall in recent months caused by the La Nina weather phenomenon, which typically brings drier weather than usual. The delay in planting came as soybean prices on the Chicago Board of Trade were propelled this month to reach around 14-month highs on concerns about smaller U.S. and South American crops as traders factored in the possibility of weak harvests due to dry weather in top producers such as Brazil, the world's No. 2 soy producer. But private weather service Somar said that weather concerns have now vanished. "Although the center-west region didn't get much rain in early October, in the last few days frequent rains have helped to accelerate planting," Celso Oliveira, a meteorologist at Somar said.
Around 70 millimeters of rain will accumulate in the next five days in the center-west soy belt, which will ensure that planting can continue quickly in states such as Mato Grosso and Goias, he said. This volume should be adequate for planting as farmers typically need some 60 to 80 millimeters to provide adequate soil moisture for their beans to grow. Farmers in Mato Grosso are typically the first to begin planting in mid-September, which means they can harvest and sell their beans ahead of rival neighboring states. This year, however, farmers in Parana--the country's second-largest soy-producing state--have managed to plant earlier than farmers in Mato Grosso.

Golden Agri Response To Palm Oil Grievance Body 'Acceptable' (Source : CME)
A grievance panel of the Roundtable on Sustainable Palm Oil said that a response by plantation operator Golden Agri-Resources Ltd. and its units to environmental concerns is "acceptable." Golden Agri's efforts to comply with RSPO standards could help the company's efforts to win back major palm oil buyers, such as global food giants Nestle SA and Unilever NV and U.S.-based fast food chain Burger King Holdings Inc., that suspended sourcing of palm oil from a Golden Agri unit in response to claims that the company is involved in deforestation. Golden Agri-Resources and its units, Indonesia-based PT Sinar Mas Agro Resources & Technology and PT Ivo Mas Tunggal, have submitted detailed plans for compliance with the sustainability body, and the grievance panel will monitor progress on agreed action plans on a quarterly basis, the RSPO and Golden Agri said Friday in a joint statement.
"The panel has evaluated the companies' responses, and considers them acceptable at this stage of the grievance procedure," according to the statement. "An initial progress report (is) scheduled to be received on Jan. 15, 2011." Golden Agri, which currently isn't a member of the RSPO, has been asked to submit a full application for membership by Nov. 8, it said. Golden Agri's two units are already members of the RSPO, a consortium of palm producers, environmental groups and food companies. Unilever suspended purchases of palm oil from PT Smart in December following claims of deforestation by Greenpeace. The food giant's palm oil requirements accounted for 3% of Smart's total annual palm oil sales of around US$1 billion. Nestle followed suit in March while Burger King was the latest company to cut purchases in September. Executives at Unilever, Nestle and Burger King couldn't immediately be contacted for a comment.

Palm oil eases from 2-yr top; losses limited on supply
KUALA LUMPUR, Oct 29 (Reuters) - Malaysian palm oil futures eased from two-year highs although losses were limited late in the session after an official said the government will push a new replanting scheme next year.
"The replanting scheme is good for next year's outlook but its a long term strategy," said a trader with a foreign commodities broker.

Bulgaria harvests 1.4 mln T of sunseeds in 2010
SOFIA, Oct 29 (Reuters) - Bulgarian farmers have harvested 1.4 million tonnes of sunflower seeds from 95 percent of the sown acreage this autumn, up from a final 1.3 million tonnes a year ago, the agriculture ministry said on Friday.
Favourable weather has also boosted the maize harvest, with farmers reaping 1.5 million tonnes from about 80 percent of the sown area, up from 1.3 million tonnes in 2009.

India contracts to export 1 mln T new season soymeal
NEW DELHI, Oct 29 (Reuters) - India has contracted to export 1 million tonnes of soymeal in the first quarter of the marketing year staring October, 18 percent more than a year ago, traders said on Friday.
India, Asia's top supplier of the animal feed, had sealed deals to export 1 million tonnes of soymeal to countries such as Japan, Vietnam and Indonesia at $380-$420 per tonne free on board, they said.

Malaysia replants more palm to boost yields
KUALA LUMPUR, Oct 29 (Reuters) - The Malaysian government's new replanting scheme will target 365,000 hectares of oil palms  older than 25 years as the world's No.2 palm oil producer tries to lift flagging output, a top industry official said on Friday.
Industry regulator the Malaysian Palm Oil Board's (MPOB) new chairman, Shahrir Samad, said the scheme would take two to three years to complete and the government had pledged 297 million Malaysian ringgit ($95.56 million) under the 2011 budget.

Argentine soy sowing speeds ahead - exchange
BUENOS AIRES, Oct 28 (Reuters) - Moist soils helped Argentine farmers advance rapidly with soy planting over the last week, and they are far outpacing last season's progress, Buenos Aires Grains Exchange said on Thursday.
Argentina is the world's third-largest exporter and farmers are planting 2010/11 soybeans at a time of strong demand from China, the top importer of the oilseed.