Monday, October 31, 2011

20111031 1818 FCPO EOD Daily Chart Study.

FCPO closed : 2938, changed : -33 points, volume : lower.
Bollinger band reading : pullback correction upside biased.
MACD Histrogram : turned lower, buyer taking profit.
Support : 2920, 2900, 2850, 2800 level.
Resistance : 2950, 2970, 3020, 3050 level.
Comment :
FCPO closed recorded loss with quiet volume participation while last Friday soy oil closed recorded loss and currently trading weaker recording loss while crude oil price also trading lower testing support level.
Soybean and soyoil price traded weaker after news on poor export and improving soybean crop pressured FCPO to trade lower today despite improved export data reported by 2 cargo surveyor compare to last month.
Daily chart formed a down doji bar candle closed below upper Bollinger band level after market opened lower and traded side way within 22 points range bound market to closed near lower range of the day.
Chart study suggesting FCPO is having pullback correction within an upside biased market development testing support and resistance level.
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.

20111031 1757 FKLI EOD Daily Chart Study.

FKLI closed : 1491, changed : +9.5 points, volume : lower.
Bollinger band reading : upside biased.
MACD Histrogram : rising, buyer in control.
Support : 1485, 1470, 1458, 1445 level.
Resistance : 1500, 1515, 1530, 1540 level.
Comment :
FKLI closed recorded gains with slower volume transacted where Nov 2011 contract ended doing about 11 points discount compare to cash market that also closed higher. Last Friday U.S. markets closed little higher and today Asia markets traded mostly lower while European markets currently declining lower.
News on China decision to maintained property curbs measure and investors choose to stay sideline awaits further details on how to fund the approved expanded bailout plan and ahead of U.S. Federal Reserve and G20 meeting resulted most global markets to trade lower.
FKLI daily chart formed an up bar candle with lower shadow positioned near upper Bollinger band level after market opened little lower, edge up few points and slide downward followed by after lunch session upward recovery to closed near the high of the day.
Technical reading suggesting an upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20111031 1705 Regional Markets EOD Daily Chart Study.

 DJIA chart reading : upside biased with possible pullback correction.
 Hang Seng chart reading :  pullback correction upside biased.
KLCI chart reading : upside biased with possible pullback correction.

20111031 1634 Global Market & Commodities Related News.

European Stocks Decline, U.S. Index Futures Drop; Vestas Slumps (Bloomberg)
European stocks dropped as some investors remain reluctant to buy equities before the euro area’s leaders explain how they will fund their expanded bailout facility. U.S. index-futures and Asian shares fell. Vestas Wind Systems A/S tumbled 25 percent as the biggest maker of wind turbines cut its forecasts for margins and revenue this year after delays in expanding production at its new plant in Germany. Barclays Plc advanced 2.1 percent after the second- largest British bank by assets reported third-quarter profit before taxes of 1.34 billion pounds ($2.2 billion). The Stoxx Europe 600 Index slid 0.9 to 246.88 at 8:02 a.m. in London. The gauge slipped 0.2 percent on Oct. 28, having rallied 3.6 percent on Oct. 27, after the euro area’s leaders said they will boost their rescue fund’s capacity in a bid to stem the debt crisis. The gauge jumped 4.2 percent last week, its fifth straight weekly gain.
“Traders are unlikely to be in a risk-on mood like they were on Thursday until they receive more clarity,” said Jonathan Sudaria, a trader at London Capital Group. “With the European Central Bank press conference and the Group of 20 at the latter part of this week, traders may prefer to sit on the sidelines until then.”

Treasuries Rise on Speculation U.S. Job Growth Slowed; Monthly Loss Pared (Bloomberg)
Treasuries advanced, trimming the steepest monthly loss in 2011, on speculation a U.S. report this week will show jobs growth slowed in October and will be short of what’s needed to cut the unemployment rate. U.S. government debt also gained as Japan sold yen in the foreign-exchange market, raising expectations that it purchased dollars and will use the money to buy Treasuries. Benchmark 10- year yields were 62 basis points away from the record low set in September on speculation the Federal Reserve will buy more debt in coming months to support the economy. “Yields suggest that people still fear there is a downside risk in the U.S.,” said Hideo Shimomura, who helps oversee the equivalent of $79.2 billion in Tokyo as chief fund investor at Mitsubishi UFJ Asset Management Co., a unit of Japan’s biggest publicly traded bank. “The U.S. economy could grow well in one to two quarters, but after that I think it will decline.”

China Stocks Decline on Wen’s Property Remarks (Bloomberg)
China’s stocks fell for the first time in six days, narrowing the benchmark index’s biggest monthly gain in a year, after Premier Wen Jiabao said the government should “firmly” maintain property curbs. Anhui Conch Cement Co., China’s biggest producer of the building material, lost 1.6 percent after the government said local authorities should strictly implement tight policies in the property industry in the coming months. Huaxia Bank Co. and Bank of Communications Co. led a gauge of financial companies to its first drop in more than a week. Baoshan Iron & Steel Co., the biggest publicly traded steelmaker, slid the most in two weeks and China Railway Group Ltd. dropped 1.9 percent after earnings for both companies slumped in the third quarter. “It’s too early to celebrate after the rally as the government is still keeping its control policies,” said Tu Jun, a strategist at Shanghai Securities Co. “The market may be range-bound at current levels and the uncertainty over policy easing will lead to volatility.”

Dollar spikes vs yen on intervention, Asian shares fall
TOKYO, Oct 31 (Reuters) - Asian shares fell and precious metals slipped as the dollar spiked to a three-month high against the yen following Japan's intervention, prompting investors to book profits after last week's rally.  
"A weak dollar, short-covering and an overbought market since the beginning of October was enought to trigger a correction (as the dollar spiked)," said Colin Bradbury, Daiwa Capital Markets' regional chief strategist for Asia ex-Japan.

FOREX-Dollar hits 3-month high on yen as Tokyo steps in
TOKYO, Oct 31 (Reuters) - The dollar spiked to a three-month high against the yen on Monday after Japan intervened in the currency markets for the third time this year to stem the yen's rise.
The greenback, pressured recently by speculation about further easing by the Federal Reserve, spiked more than 3 percent to as high as 78.99 yen  in a matter of minutes, the highest since Aug. 5, after hitting another all-time low of 75.31 yen  on EBS earlier in Asian trade.

Norway oil fund wants more details on bailout scheme
OSLO, Oct 28 (Reuters) - Norway's huge oil fund is holding fire on possible investments in the euro zone's beefed-up rescue
mechanism until it has more information on how they would be structured, its chief executive said.
"We do not have sufficient detail really to comment on what it would do for us in terms of investment opportunity," Yngve Slyngstad told Reuters in an interview, adding the oil fund's existing exposure to the European Financial Stability Facility (EFSF) was small.
US grain futures flat; headed for monthly gains
SYDNEY, Oct 31 (Reuters) - U.S. grains and soybeans futures were flat, weighed down by weak demand, while prices were on track for gains this month after shedding more than 18 percent in September.
Chicago Board of Trade (CBOT) corn for December delivery  eased 0.04 percent to $6.54-3/4 per bushel in early trading after notching up its fourth weekly gain last week as U.S. growers held back from selling freshly harvested grain in the hope of improved prices. The contract is heading for around a 10 percent gain for October.

Argentine 2011/12 corn sowing advances swiftly-gov't
BUENOS AIRES, Oct 28 (Reuters) - Argentine farmers made swift progress to plant 2011/12 corn thanks to moist soils, though cold weather caused delays in some areas, the Agriculture Ministry said on Friday.
Argentina is the world's No. 2 corn exporter but dryness has delayed seeding of the crop. Heavy rains this month provided moisture to soils and helped speed plantings, but farmers are still behind last season's pace.

Ohio wheat acres could drop to record low this year
CHICAGO, Oct 28 (Reuters) - Wheat plantings could fall to a record low this year in Ohio despite a record-high insurance price guarantee, as incessant rains stalled wheat seedings in the top growing state of the soft red winter variety.
Wheat acres left fallow this winter are likely to be planted with corn in the spring, crop experts said, as corn futures remain at a historically high premium over wheat.

Drought affects 39 pct of Ukraine '12 winter grains
KIEV, Oct 28 (Reuters) - The share of sprouted Ukrainian winter grain crops which were in poor state jumped to 39 percent as of October 27 from 29 percent as of October 24, the Agriculture Ministry said on Friday, quoting data from regions.
The ministry said in a statement that farms had sown 7.7 million hectares of winter grains for the 2012 harvest and 4.5 million had sprouted so far. The ministry added that 3.1 million hectares of the sprouted crops were in good or satisfactory condition while 1.4 million hectares were in poor state.
Big EU maize crop mostly cut, offers export window
PARIS, Oct 28 (Reuters) - Maize harvesting in the European Union's major producing countries is mostly complete, confirming expectations of a big crop that should allow higher EU exports this season.
Maize has been boosted by favourable growing conditions this year as well as an increased planted area in several countries, even if summer heat in parts of the eastern part of the EU is thought to have limited yields there.

Russia unlikely to emerge as major sugar exporter
MOSCOW/LONDON, Oct 28 (Reuters) - Russia is moving toward self-sufficiency in sugar but a number of obstacles will prevent its emergence as a major exporter.
Russia, which was the world's top raw sugar importer in the early 2000s when it used to buy around 4 million tonnes a year, has slid down the rankings as an importer as strong prices encouraged domestic investment. The country looks set to produce just short of its consumption requirements in 2011/12.

Oil Declines in New York, Paring Biggest Monthly Increase Since May 2009 (Bloomberg)
Oil fell in New York on speculation demand will falter after the biggest monthly gain in more than two years and a surge in the dollar. Brent’s premium to U.S. crude slid to a four-month low. Futures fell as much as 1.2 percent after Japan weakened the yen for the third time this year and a technical indicator signaled prices may have risen too fast. A stronger dollar typically curbs demand for commodities from holders of other currencies. Crude prices at $100 a barrel would be unsustainable, according to the former head of the International Energy Agency. Oil is up 17 percent in October, the biggest monthly increase since May 2009. “My anticipation is that prices will consolidate,” said Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney. Prices at $93 to $95 a barrel are “expensive,” he said.

Oil prices slip; G20 meeting eyed
PERTH, Oct 31 (Reuters) - Oil prices fell, with traders cautious ahead of the Group of 20 leaders' meeting later this week that will focus largely on the European debt crisis.  
"I think at the moment we're riding on the back of optimism created from the euro zone plan. In order for prices to stay at this level, the optimism must continue," Jonathan Barratt, managing director of Commodity Broking Services in Sydney, said.

Libya's oil exports to jump to 350,000 bpd in Nov-sources
TRIPOLI, Oct 30 (Reuters) - Libya's crude oil exports will jump to almost 350,000 barrels per day in November, more than double the volume sold the previous month, sources at the National Oil Company (NOC) told Reuters in an interview on Sunday.
The NOC plans to sell a total of up to 14 cargoes of oil from several fields, primarily in the east and at offshore sites which escaped the worst of the damage inflicted by the war and located in areas that were liberated soon after the uprising.

Bangladesh cuts H2 fuel oil import estimate
DHAKA, Oct 30 (Reuters) - Bangladesh will import up to 540,000 tonnes of fuel oil in the second half of this year, down from an earlier estimate of 700,000 tonnes, due to delays in power plant projects, a senior official at Bangladesh Petroleum Corporation (BPC) said on Sunday.
Bangladesh is buying large volumes of fuel for power plants burning diesel or fuel oil, even though these are costly, as domestic gas supply has failed to keep pace with demand.

European steel sector set for sharper slowdown
BRUSSELS, Oct 28 (Reuters) - European steelmakers are braced for a weak end to the year after fears of recession that emerged in August transformed a seasonal dip in the third quarter into an extended slowdown.
Weak developed markets, exacerbated by the euro zone debt crisis, and tight credit conditions in China, the world's biggest steel consumer and producer, have weighed on the sector, even if the costs of raw materials are falling.

Iron ore slump to boost shorter contracts, risks
SINGAPORE, Oct 31 (Reuters) - A slide in iron ore prices has driven miners to alter costly quarterly contracts to please Chinese clients, but spot pricing, which magnifies the impact of price swings, is still distant.
Iron ore's slump of 34 percent since early September revealed the flaws of a system that prices contracts based on the previous quarter's spot rates with a one-month lag, and opened the door for a more flexible mechanism for top consumer China while it grapples with weakening steel demand.

Global iron ore prices reaching turning point - Baosteel
SHANGHAI, Oct 31 (Reuters) - The recent slump in global iron ore price signals the market may be reaching a turning point, China's top listed steel mill Baoshan Iron & Steel Co Ltd (Baosteel) , said on Monday, adding that the price correction will allow a healthy expansion for steel producers and miners.
Baosteel, which reported a 51-percent slump in third-quarter net profit on Friday, also said it was in negotiations with top iron ore producer Vale SA  to review prices for fourth-quarter supplies.

China steel assn says iron ore prices likely to drop further
BEIJING, Oct 31 (Reuters) - The China Iron and Steel Association (CISA) said the price of iron ore was likely to decline further in the coming weeks, with steel mills still unwilling to buy and stockpiles of expensive ores remaining unsustainably high.
Zhang Changfu, CISA's vice-chairman, told a news briefing on Monday that stockpiles at eight major ports had risen to 98 million tonnes, with much of it bought at prices of around $165 per tonne.

Baosteel says domestic steel mills to see improving margins
SHANGHAI, Oct 31 (Reuters) - China's steel mills are expected to see their profit margins gradually improve, a senior executive from Baosteel    said on Monday.
The average profit margin for China's large- and medium-sized steelmills from January-September this year was 2.99 percent, Ma Guoqiang, general manager of Baosteel, said during an online results briefing.

Copper rolls back gains as Europe deal euphoria fades
SHANGHAI, Oct 31 (Reuters) - London copper fell below $8,000 on a firmer dollar and as hopes for a speedy resolution of Europe's debt crisis waned, but the metal is on track for its biggest monthly rise since December.  
"Commodities are under some pressure from a firmer dollar. Technically, Shanghai copper is going to meet with some resistance near the 60,000 yuan level and volatility is to be expected," CIFCO Future analyst Zhou Jie.

Congo copper surge hinges on infrastructure success
KINSHASA, Oct 28 (Reuters) - Congo's lofty expansion plans for copper output risk remaining on paper as a Chinese infrastructure deal has yet to fall into place and the government struggles to secure partnerships with mining firms to revamp railways and power stations.
Kinshasa has revived mining since the end of a devastating civil war, expanding copper output fivefold, but is still operating well below its massive potential from some of the world's biggest mineral reserves.
METALS-Copper rolls back gains as Europe deal euphoria fades
SHANGHAI, Oct 31 (Reuters) - London copper fell below $8,000 on Monday on a firmer dollar and as hopes for a speedy resolution of Europe's debt crisis waned, but the metal is on track for its biggest monthly rise since December.  
Continued supply disruptions at the world's second largest copper mine, Grasberg in Indonesia, and steady spot demand in China are expected to limit losses.

PRECIOUS-Gold slides 2 pct on Japan FX intervention
SINGAPORE, Oct 31 (Reuters) - Gold prices dropped about 2 percent on Monday, after Japan's intervention in the currency market triggered a rapid rally in the dollar, spooking precious metals investors.
Japan intervened unilaterally in the foreign exchange market on Monday to curb the yen's strength, sending the dollar up more than 1 percent against a basket of currencies.

Gold slides 2 pct on Japan FX intervention
SINGAPORE, Oct 31 (Reuters) - Gold prices dropped about 2 percent, after Japan's intervention in the currency market triggered a rapid rally in the dollar, spooking precious metals investors.
"The huge spike in the dollar is pressuring gold prices," said Ong Yi Ling, an analyst at Phillip Futures. "But so long as gold stays above $1,700, the sentiment should remain pretty bullish."

MF Global trades as usual on exchanges -SGX, LME
SINGAPORE/LONDON, Oct 28 (Reuters) - Exchanges in London and Singapore said it was business as usual on their bourses for futures broker MF Global Holdings Ltd  on Friday, after two rating agencies downgraded its debt to junk status.
MF Global, whose shares slumped 15.9 percent on Thursday and around 10 percent on Friday, had been trying to transform from a brokerage that mainly places customers' trades into an investment bank that bets with its own capital.

20111031 1134 Global Market & Commodities Related News.

Asian Stocks Decline as Acer, Tohuku Electric Report Losses; Qantas Jumps (Bloomberg)
Asian stocks declined, with the MSCI Asia Pacific Index trimming its biggest monthly advance in two years, as companies from Acer Inc. to Tohoku Electric Power Co. reported losses. Acer, the world’s fourth-largest computer maker, fell 2.3 percent in Taipei. Tohoku Electric slumped 6.8 percent after the Japanese utility reported a wider-than-expected net loss. Qantas Airways Ltd. jumped 6.5 percent in Sydney as it plans to resume flights today after a labor regulator barred work stoppages that had prompted Australia’s biggest carrier to ground its fleet. The MSCI Asia Pacific Index dropped 1.6 percent to 122.73 as of 10:57 a.m. in Tokyo. The measure has gained 8.6 percent this month, the most since May 2009, after a breakthrough in Europe boosted confidence the region’s sovereign-debt crisis will be contained, U.S. economic growth accelerated and China hinted at easing monetary policy.

GLOBAL MARKETS-Stocks, euro pause as Europe doubts linger
NEW YORK, Oct 28 (Reuters) - U.S. and European shares took  a breather on Friday after a strong rally on a long-awaited euro zone rescue deal, but a weak sale of Italian bonds showed investor confidence in the agreement was shaky.
"I think we have a long way to go with this (European debt) mess. I still see huge risks," said Stanley J.G. Crouch, who oversees $2 billion as the chief investment officer of Aegis Capital in New York.

COMMODITIES-Markets look past Europe deal after big weekly gain
NEW YORK, Oct 28 (Reuters) - Commodities mostly fell in thin trading on Friday as euphoria from the euro zone debt deal faded, and investors reweighed their outlook after big weekly price gains in metals and oil.
"Beyond the very near-term, we think economic fundamentals will be watched more closely again," Credit Suisse said in a commodities research note.

COLUMN-Ebbing oil prices point to market shift: John Kemp
--John Kemp is a Reuters market analyst. The views expressed are his own--
LONDON, Oct 28 (Reuters) - For all the bullish talk about tight supplies next year if the global economy skirts renewed recession, and occasional sharp short-covering rallies, benchmark oil prices are softening.
In the past six months, each of a series of sharp short-covering rallies has pushed the front-month Brent futures contract  to peak at a lower level than the previous one: $127 on April 11, $126 on April 28, $121 on June 15, $120 on Aug. 1, $116 on Sept. 8, $114 on Oct. 14 and now $112 on Oct. 27.

COLUMN-Oil and gas leases place lenders at risk-Chris Kimmerle
--Chris Kimmerle is a Reuters market analyst. The views expressed are his own.--
NEW YORK, Oct 28 (Reuters) - As the United States continues to deal with the aftermath of the collapsed real estate bubble and the associated erosion of home values, there may be an unrecognized exposure for real estate lenders resulting from the rapid expansion of oil and gas development.
The risk is in states such as Colorado, New York, Ohio and Pennsylvania as well as in the urban, suburban and exurban areas of Denver, Fort Worth and Pittsburgh, and involves the decline in real estate values that follows the severance of surface and mineral rights on mortgaged properties.

Oil prices slip; G20 meeting eyed
PERTH, Oct 31 (Reuters) - Oil prices fell on Monday, with traders cautious ahead of the Group of 20 leaders' meeting later this week that will focus largely on the European debt crisis.  
"I think at the moment we're riding on the back of optimism created from the euro zone plan. In order for prices to stay at this level, the optimism must continue," Jonathan Barratt, managing director of Commodity Broking Services in Sydney, said.

Libya's oil exports to jump to 350,000 bpd in Nov-sources
TRIPOLI, Oct 30 (Reuters) - Libya's crude oil exports will jump to almost 350,000 barrels per day in November, more than double the volume sold the previous month, sources at the National Oil Company (NOC) told Reuters in an interview on Sunday.
The NOC plans to sell a total of up to 14 cargoes of oil from several fields, primarily in the east and at offshore sites which escaped the worst of the damage inflicted by the war and located in areas that were liberated soon after the uprising.

Iran sees no need for emergency OPEC meeting -ISNA
TEHRAN, Oct 30 (Reuters) - Current OPEC president Iran does not envisage holding an emergency meeting of the oil producers' group ahead of a scheduled one in December, Iran's OPEC Governor Mohammad Ali Khatibi was quoted as saying by the student news agency ISNA on Sunday.
"I find it improbable to have an OPEC emergency meeting because there is no emergency matter and the market is balanced," he was quoted as saying.

Petronas wants to boost overseas oil & gas ventures-report
KUALA LUMPUR, Oct 30 (Reuters) - Malaysia's oil and gas firm Petronas wants to "high grade" its international operations by acquiring more valuable assets and exiting from less profitable ventures, the Edge newspaper reported on Sunday. The weekly paper cited Petronas Executive Vice President of Exploration and Production Wee Yiaw Hin as saying the state-linked firm was keen on expanding in Asia, West Africa  and South America. "We actually want to grow our international operations. We will get out of those (countries) where profitability is low. And we have a few more on the list," Wee was quoted as saying.
"Algeria is one. Over there, there is not a big field to develop, costs have gone up, profitability is very weak and its not easy to succeed," he added.

Natural gas ends up 4 pct, cold temps stir buying
NEW YORK, Oct 28 (Reuters) - U.S. natural gas futures ended sharply higher on Friday despite concerns about growing supplies, as cold weather moved into the Northeast and Midwest and stirred up more heating demand.
"The cold weather this week triggered it (rally), and people expect to see more cold as we head into winter, but extended forecasts seem to be trending milder," said Steve Mosley at SMC Advisory Services in Arkansas.

Euro Coal-prices rise despite weaker oil
LONDON, Oct 28 (Reuters) - European prompt physical coal prices rose slightly on Friday, shrugging off falls in oil and coal swaps.
Physical demand remained thin, because some players with long positions lack the capacity to burn coal and many utilities are burning down their stockpiles before ordering new deliveries.

20111031 1039 Global Economic Related News.

Thailand: ‘Credibility’ at stake as factories soak in flood plain
More than 9bn cubic meters of water released this month from dams filled to capacity have swept down a river basin the size of Florida, inundating seven industrial parks that helped transform Thailand from an agriculture-based economy to a manufacturing hub since the first one was built four decades ago. The worst floods since 1942 have shuttered 10k factories, put 660k jobs at risk and caused damage of THB140bn, government figures show. Factory owners are concerned the disaster may repeat itself as water defenses fail to keep pace with the development of roads, housing estates and business complexes in Bangkok and its vicinity, which accounts for about half of Thailand’s industrial output. (Bloomberg)

Thailand: The central bank lowered its growth forecasts as floods began overwhelming the capital of Southeast Asia's second-largest economy, raising the odds of an interest-rate cut in the coming months. The economy may expand 2.6% YoY this year from a previous prediction of 4.1% YoY, the Bank of Thailand said in Bangkok, adding that forecasts may be lowered further in November. The central bank cut its estimate for inflation this year, while raising consumer-price forecasts for 2012, Assistant Governor Paiboon Kittisrikangwan said. (Source: Bloomberg)    

Australia: TD 12-month inflation gauge slows as food costs drop
Australia’s annual inflation rate slowed in October for a third straight month on declining costs for fruit and vegetables, rent and furniture, a private report showed. Consumer prices rose 2.6% this month from a year earlier, compared with a 2.8% annual gain in September, according to an index compiled by TD Securities Inc and the Melbourne Institute released in Sydney. The central bank aims to keep annual inflation in a 2% to 3% range on average. Prices rose 0.1% in October from a month earlier after a 0.1% rise in September. (Bloomberg)

China: Online sales seen tripling driving warehouse surge, retail
China’s largest online retailers expect sales to as much as triple next year, setting off a rush for warehouse space that’s pushing up rents in the world’s fastest-growing major economy. “Everyone wants more warehouses,” Ji Wenhong, CEO of luxury goods seller, said in an interview. “Any warehouse bigger than 20k square meters will be leased the second it’s out on the market.” Wal-Mart Stores Inc.-backed Yihaodian is looking for more space in anticipation of need., China’s second- largest e-commerce company by sales, plans to invest as much as CNY6bn over the next three years to build seven distribution centers. (Bloomberg)

South Korea: Output rises as exports resist global slowdown
South Korea’s industrial production rose last month after two straight declines as exports of cars and semiconductors withstood the global slowdown. Output gained 1.1% last month from August, when it dipped 1.9%, Statistics Korea said. The median estimate of eight economists in a Bloomberg News survey was for a 0.4% decline. Production rose 6.8% from a year earlier after gaining a revised 4.7% gain in August. South Korea’s economic growth slowed in the third quarter as Europe’s debt crisis and a faltering US recovery prompted companies to reduce spending. (Bloomberg)

Japan: Industrial production fell more than analysts expected in September. Factory output slid 4% MoM in September from the previous month, the trade ministry said in a report in Tokyo, the first decline since the disaster. (Source: Bloomberg)

EU: Italy’s borrowing costs rise to Euro-era record at bond auction
Italy’s borrowing costs rose to a euro-era record at a sale of 3-year bonds, driving yields higher on concern that efforts to contain the sovereign crisis won’t be enough to safeguard the region’s third-largest economy. The Rome-based Treasury sold EUR3.08bn (USD4.36bn) of 2014 bonds to yield 4.93%, the highest since November 2000, and up from 4.68% on 29 Sept. Italy’s bonds extended declines after the sale, while German bunds pared most of their earlier losses. (Bloomberg)

EU: German bonds fall for 2nd day on EU optimism; Italy bonds drop
Germany’s bonds fell for a second day, extending a weekly decline, as optimism Europe will contain its debt crisis fueled an advance in stocks and damped demand for safer investments. Two-year German notes were poised for their first monthly drop since June. Top-rated bonds also declined before a report that economists said will show US consumer confidence increasing, easing concern the global economy is stalling. Italian 10-year debt fell after the government sold notes and bonds, the first offering since European Union leaders ended an all-night summit in Brussels. (Bloomberg)

Greece: Fitch says 50% bond haircut would be default event. "The 50% nominal haircut on the proposed bond exchange would be viewed by the agency as a default event under its Distressed Debt Exchange criteria," the statement said. While the accord is "a necessary step to put the Greek sovereign's public finances on a more sustainable footing," Greece will face "significant challenges" including ratios of government debt to gross domestic product at "well over 100% even in a positive scenario." (Source: Bloomberg)

Russia: Leaves interest rates unchanged to cap lending growth. Bank Rossii held the refinancing rate at 8.25% after two increases this year. The overnight auction-based repurchase rate remained at 5.25% and the deposit rate was left at 3.75%. (Source: Bloomberg)

US: Economy revives as consumer shows what’s done refutes sentiment
Americans’ urge to shop is overriding anxiety about the economy. While household-sentiment measures are at levels typically observed during a recession, an increase in spending during the third quarter boosted growth to the highest level of the year, Commerce Department figures showed on 27 Oct. The schism partly reflects consumer ire with the government’s failure to reduce 9.1% unemployment or stem rising deficits, said James Paulsen, chief investment strategist at Minneapolis based Wells Capital Management. (Bloomberg)

U.S: Michigan consumer sentiment index rises to 60.9 in October from 59.4 in September. The gauge was projected to drop to 58. The preliminary reading for the month was 57.5. (Source: Bloomberg)

U.S: Consumer spending increased 0.6% MoM in September, after a 0.2% MoM gain the prior month. Incomes rose less than projected, sending the savings rate down to the lowest level in almost four years. (Source: Bloomberg)

20111031 1038 Malaysia Corporate Related News.

Petronas: Licensing system policy remains
There is no policy change on licensing system for companies engaged in Malaysia’s upstream oil and gas industry, Petroliam Nasional said. Under the Petroleum Regulations 1974, companies wishing to commence or continue any business or services related to Malaysia’s oil and gas upstream operations and activities must apply for a licence from Petronas. (StarBizWeek)

AirAsia sells planes to affiliate
Budget airline AirAsia is selling five Airbus A320 units to its affiliate, PT Indonesia AirAsia, via a series of finance lease transactions, in order to comply with Indonesian airlines’ regulations. The total consideration for the transfer of the five aircraft was RM550.85m and is expected to result in a gain of RM49.7m for AirAsia and increase its net earnings per share by RM0.02 for the financial year ending 31 Dec 2011. (StarBizWeek)

Zelan gets offer letter from Mudajaya
Zelan has received a letter of intent from Mudajaya Corp, a member of the consortium comprising Alstom, Mudajaya and Eversendai Corp, to subcontract a portion of the civil works to Zelan with a total value not exceeding RM300m. (StarBizWeek)

EMS Malaysia not linked to Pos Malaysia
Pos Malaysia has clarified that a company known as EMS Malaysia is not affiliated to or linked with it or any of its business units, departments and subsidiaries. It did not assign any business operating rights to EMS Malaysia to operate any postal services despite the latter’s reference to Pos Malaysia’s former call centre address in its website as its customer service address. (StarBizWeek)

KNM and Zecon yet to finalize complex deal
KNM Group and Zecon have not achieved a financial close with Gulf Asian Petroleum SB for a RM17.3bn integrated petro-chemical complex in Telum Ramunia, Johor. Both KNM and Zecon told Bursa Malaysia that all parties to the preliminary deals struck in July would continue to pursue the finalization of the agreement and financing for the project. (StarBizWeek)

Media Prima, Puncak Semangat in early talks
Media Prima is in preliminary talks with privately-held Puncak Semangat SB (PSSB), which is looking at converting all analog televisions into digital ones by 2015. PSSB, owned by tycoon Tan Sri Syed Mokhtar Al-Bukhary, has been bidding for the conversion job from the Government for the last three years. (BT)

Pintaras wins job
Pintaras Jaya has won a RM30m deal from Lumayan Indah SB to undertake sub-structure works, including temporary retaining structures, piling and pile caps for a service apartment at Jln Conlay, KL. (BT)

Melati Ehsan unveils RM300m Bukit Bayu project in Shah Alam
Melati Ehsan Holdings on Saturday launched its 24ha bungalow development named Bukit Bayu@U10 Shah Alam in Section U10 with a gross development value of RM300m. Melati Group MD Tan Sri Yap Suan Chee told a press conference on Saturday that the project comprises 133 bungalow units, with 65 units to be developed in the first phase and another 68 units in the second phase. (Malaysian Reserve)

Genting Malaysia: Sees RM2.5b in 2012 sales from New York Aqueduct slots. The casino opened last Friday at New Yorks Aqueduct racetrack is expected to generate USD800m (RM2.45b) in revenue next year. The 190,000 sq ft floor has 205 electronic table games and 2,280 video lottery terminals. (Source: The Malaysian Reserve)

Bintulu Port: Plans to raise RM3b for Samalaju port. Bintulu Port Holdings Bhd is looking at government loans and the bond market to raise up to RM3b for the construction of the Samalaju port to support energy-intensive industries in the area. The port is part of the Sarawak Corridor of Renewable Energy (SCORE) and will be crucial to transport raw materials and finished goods in the Samalaju Industrial Park. (Source: The Edge Weekly)

Malayan Flour Mills: Readies itself for Indonesia. Malayan Flour Mills Bhd (MFM) and its partners will invest a total of USD66m (RM204.6m) to establish a flour mill in Jakarta, with construction to start next year and operations to begin in 2013. The mill is expected to have a flour production capacity of 1,500 tonnes per day. (Source: The Edge Weekly)

HDD: Seagate benefit for JCY and Dufu. Component makers, which supply mainly to Seagate Technology plc, could well take pole position in the hard-disk drive (HDD) industry after rival Western Digital Corp was beaten out by the flooding in Thailand. (Source: The Edge Daily)

20111031 1027 Global Market Related News.

Asia Stocks Decline as Yen Climbs to Record (Source: Bloomberg)
Asian stocks fell, with the MSCI Asia Pacific Index trimming its biggest monthly advance in two years, as the yen rose to a record ahead of a U.S. Federal Reserve meeting this week, hurting the outlook for Japanese exporters. Honda Motor Co., Japan’s second-largest carmaker by market value that gets 83 percent of its revenue abroad, dropped 3 percent. Lynas Corp., an Australian rare earths producer, sank 3 percent in Sydney following a delay in the construction of a facility in Malaysia. Qantas Airways jumped 6.5 percent as it plans to resume flights today after a labor regulator barred work stoppages that had prompted Australia’s biggest carrier to ground its fleet. The MSCI Asia Pacific Index fell 0.3 percent to 124.36 as of 9:30 a.m. in Tokyo. The measure has gained 9.9 percent this month, the most since May 2009, after a breakthrough in Europe boosted confidence the region’s sovereign-debt crisis will be contained, U.S. economic growth accelerated and China hinted at easing monetary policy.

Employment Probably Cooled in October, Showing U.S. Recovery Must Quicken(Source: Bloomberg)
Employment probably cooled in October, indicating the U.S. recovery remains too weak, economists said before reports this week. Payrolls climbed by 95,000 workers after a 103,000 September increase, according to the median forecast of 65 economists surveyed by Bloomberg News ahead of Nov. 4 data from the Labor Department. The jobless rate was 9.1 percent for a fourth consecutive month, the report may also show. Hiring slowed even as the economy grew in the third quarter at the fastest pace in a year, showing why some Federal Reserve policy makers have said in advance of their meeting this week that the central bank should be prepared to do more. While retailers like Macy’s Inc. (M) are boosting staff ahead of the holidays, bigger job gains are needed to spur consumer spending.

U.S. Stock Futures Drop as S&P 500 Index Heads for Best Month Since 1974(Source: Bloomberg)
U.S. stock futures fell, following a fourth straight weekly advance that left the Standard & Poor’s 500 Index poised for the biggest monthly rally since 1974. Futures on the S&P 500 expiring in December fell 0.5 percent to 1,274.70 at 9:15 a.m. Tokyo time. The benchmark measure for U.S. stocks advanced 3.8 percent last week and has climbed 14 percent this month. Stocks gained last week after the European rescue fund was boosted to 1 trillion euros ($1.4 trillion) and investors agreed to a voluntary writedown of 50 percent on Greek debt. The S&P 500 had fallen five consecutive months, driven lower by concern the debt crisis would curb global growth, before starting to rebound on Oct. 3. The stock index recovered as better-than- estimated U.S. reports pushed the Citigroup Economic Surprise Index above zero for the first time since April.

Treasuries Rise on Speculation U.S. Job Growth Slowed; Monthly Loss Pared(Source: Bloomberg)
Treasuries rose, trimming their steepest monthly loss this year, on speculation a government report this week will show U.S. employment growth slowed in October, easing expectations for a faster economic expansion. Benchmark 10-year yields were 63 basis points away from the record low set last month. Some Federal Reserve policy makers have said before a two-day meeting that starts tomorrow the Fed should increase its debt purchases to support the economy. “Yields suggest that people still fear there is a downside risk in the U.S.,” said Hideo Shimomura, who helps oversee the equivalent of $79.2 billion in Tokyo as chief fund investor at Mitsubishi UFJ Asset Management Co., a unit of Japan’s biggest publicly traded bank. “The U.S. economy could grow well in one to two quarters, but after that I think it will decline.”

MF Global Faces Pivotal Days as Firm Mulls Sale(Source: Bloomberg)
MF Global Holdings Ltd., the company run by Jon Corzine that last week reported a record loss, had two of its credit ratings cut to junk and drained bank lines, faces a pivotal few days as the futures broker pitches itself to potential buyers to avert failure. The firm’s board met through the weekend in New York to consider options, according to a person with direct knowledge of the situation. MF Global has hired Weil, Gotshal & Manges LLP for a London affiliate, another person said. The law firm currently represents Lehman Brothers Holdings Inc., which in 2008 filed the biggest bankruptcy in U.S. history.
Pressure is mounting on Corzine, the former governor of New Jersey and U.S. senator, after MF Global declined 67 percent last week and its bonds started trading at distressed levels amid its disclosures of bets on European sovereign-debt. MF Global was in discussions with five potential buyers for all or parts of the company, including banks, private-equity firms and brokers, said the person, who asked not to be identified because the talks are private.

Best Month Since July 2009 Driven by Tech, Oil Earnings: China Overnight(Source: Bloomberg)
China’s stock-index futures fell, signaling the benchmark index may decline for the first time in six days, after Premier Wen Jiabao said the government should “firmly” maintain property curbs. Futures on the CSI 300 Index expiring in November, the most active contract, lost 0.4 percent to 2,700.20 as of 9:16 a.m. local time. China Vanke Co., the nation’s biggest developer by market value, may pace declines after the government said local authorities should continue to strictly implement tight policies in the property industry in the coming months. Baoshan Iron & Steel Co. and China Railway Group Ltd. may drop after third- quarter profit slumped.
The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, climbed 37.80 points, or 1.6 percent, to 2,473.41 on Oct. 28. The gauge advanced 6.7 percent last week, the biggest gain since the period ended Oct. 15, 2010, after Premier Wen said on Oct. 25 the government will fine-tune economic policies at an “appropriate time.” The CSI 300 Index rose 1.9 percent to 2,709.02 on Oct. 28.

China to ‘Firmly’ Maintain Property Curbs: Wen(Source: Bloomberg)
China will “firmly” maintain its property curbs and “fine tune” other economic policies at an appropriate time, according to a statement following a State Council meeting chaired by Premier Wen Jiabao. Local authorities should continue to strictly implement the central government’s real-estate policies in the coming months to let the citizens see the results of the curbs, according to the statement on Oct. 29. The government will “fine tune” its economic policies by “an appropriate degree and at an appropriate time,” it said. “It demonstrates to local governments and developers the central government’s determination to tighten the property market,” said Liu Li-Gang, a Hong Kong-based economist at Australia & New Zealand Banking Group Ltd. “With inflation still at a high level, it’s unlikely the government will take a big step to loosen its policy, but only a partial easing.”

China Shuffles Financial, Securities Regulators(Source: Bloomberg)
China moved its securities regulator Shang Fulin to head the nation’s banking watchdog, overseeing a 106 trillion-yuan ($17 trillion) industry that includes four of the world’s 10 largest lenders by market value. Shang’s appointment as chairman of the China Banking Regulatory Commission to replace Liu Mingkang is part of the biggest reshuffle of financial officials in a decade. China Construction Bank Corp. Chairman Guo Shuqing will become head of the securities watchdog and Agricultural Bank of China Ltd. Chairman Xiang Junbo will take the top job at the insurance regulator, the government said on Oct. 29.
Shang, 59, takes over at the watchdog for an industry whose assets have more than tripled over the past eight years as China’s economy became the world’s second largest. After almost nine years as the securities regulator, Shang will be in charge of curbing a potential surge in bad loans following a record $2.7 trillion two-year credit boom that propelled China’s expansion after the global financial crisis.

China Online Sales Triple; Warehouses Surge(Source: Bloomberg)
China’s largest online retailers expect sales to as much as triple next year, setting off a rush for warehouse space that’s pushing up rents in the world’s fastest-growing major economy. “Everyone wants more warehouses,” Ji Wenhong, chief executive officer of luxury goods seller, said in an interview. “Any warehouse bigger than 20,000 square meters will be leased the second it’s out on the market.” Wal-Mart Stores Inc (WMT).-backed Yihaodian is looking for more space in anticipation of need., China’s second- largest e-commerce company by sales, plans to invest as much as 6 billion yuan ($943 million) over the next three years to build seven distribution centers as the Beijing-based company expects 2011 sales to triple from last year to 30 billion yuan.

Japanese Stocks Gain, Reversing Losses, as Yen Weakens Against Dollar(Source: Bloomberg)
Japanese stocks fell for the first time in three days, as the yen rose to a record amid speculation the U.S. Federal Reserve will embark on another round of asset purchases. Sony Corp., Japan’s biggest exporter of consumer electronics, slid 0.7 percent. Honda Motor Co. fell 3.1 percent after the Nikkei newspaper reported the carmaker may take six months to resume production at a flooded factory in Thailand. Ebara Corp., a pump maker, tumbled 9.2 percent after cutting its full-year profit forecast. The Nikkei 225 Stock Average declined 0.4 percent to 9,018.85 as of 9:33 a.m. in Tokyo. For the month, the gauge is headed for a 3.6 percent gain. The broader Topix index retreated 0.3 percent to 769.06. The yen’s surge to a record “weighs on exporters,” said Toshiyuki Kanayama, a market analyst at Tokyo-based Monex Inc. Investors are likely to lock in their profits after the market surged last week, he said.

Yen Falls Amid Speculation of Japan Intervention(Source: Bloomberg)
The yen plunged against the dollar and euro amid speculation Japan intervened in markets to weaken its currency. The yen sank 3.2 percent to 78.30 per dollar as of 10:34 a.m. in Tokyo. It lost 2.8 percent to 110.38 per euro. Japanese Finance Minister Jun Azumi said earlier today he’s ready to take “determined” steps in the currency market if needed after the yen rose to a fresh post-World War II high against the dollar. He told reporters in Tokyo today that speculative activity is strong in the currency market, adding that the yen’s moves don’t reflect Japan’s economic fundamentals.

Yen Climbs to Postwar Record Versus Dollar as Traders See No Intervention(Source: Bloomberg)
The yen rose to a post-World War II record against the dollar as traders speculated Japanese officials are wary of selling the local currency. The yen surpassed the previous high set last week, prompting Japanese Finance Minister Jun Azumi to say he’s ready to take “determined” steps in the currency market. The dollar dropped versus all of its 16 major peers this month amid speculation the Federal Reserve may add to stimulus measures. The euro weakened before figures that may show the region’s inflation slowed in October, spurring prospects of an interest- rate cut by the European Central Bank this week. “The Bank of Japan didn’t intervene in currency markets last week and that’s been taken by the market as a signal to further strengthen the yen,” said Khoon Goh, head of market economics and strategy at ANZ National Bank Ltd. in Wellington.

South Korea’s Industrial Output Rises as Exports Withstand Global Slowdown(Source: Bloomberg)
South Korea’s industrial production rose last month after two straight declines as exports of cars and semiconductors withstood the global slowdown. Output gained 1.1 percent last month from August, when it decreased 1.9 percent, Statistics Korea said today. The median estimate of eight economists in a Bloomberg News survey was for a 0.4 percent decline. Production rose 6.8 percent from a year earlier after gaining a revised 4.7 percent gain in August. South Korea’s economic growth slowed in the third quarter as Europe’s debt crisis and a faltering U.S. recovery prompted companies to reduce spending. The deceleration may pressure the Bank of Korea to hold off from raising interest rates even as inflation remains above its target ceiling.

Thai ‘Credibility’ at Stake as Factories Soak(Source: Bloomberg)
Hana Microelectronics Pcl is among the thousands of Thai companies with factories swamped by record floods calling on the government to help ensure it never happens again as waters slowly recede north of Bangkok. “Thailand’s credibility is on the line here,” said Hana Chief Executive Richard Han, whose Bangkok-based company makes parts used in digital music players and mobile phones. “A complete review of how to protect these industrial estates needs to be conducted and it needs government support.” More than 9 billion cubic meters of water released this month from dams filled to capacity have swept down a river basin the size of Florida, inundating seven industrial parks that helped transform Thailand from an agriculture-based economy to a manufacturing hub since the first one was built four decades ago. The worst floods since 1942 have shuttered 10,000 factories, put 660,000 jobs at risk and caused damage of 140 billion baht ($4.6 billion), government figures show.

European Stocks Surge for Fifth Week After Leaders Strike Debt-Crisis Deal(Source: Bloomberg)
European stocks climbed for a fifth week, the longest stretch of gains in 18 months, after the region’s leaders struck a deal to enact measures to contain the sovereign debt crisis following months of negotiations. An index of banks surged the most since July 2010 as Credit Agricole SA and Deutsche Bank AG jumped more than 19 percent. Kazakhmys Plc, Kazakhstan’s biggest copper producer, and SSAB AB, the Stockholm-based steelmaker, led basic-resources companies to the largest gain in more than two years. BP Plc, Merck KGaA and Renault SA rallied at least 6 percent after results topped analyst estimates. The Stoxx Europe 600 Index climbed 4.2 percent to 249 this past week. The gauge has surged 10 percent in October, heading for its biggest monthly advance since April 2009, amid speculation the economy will evade another recession and Europe will avoid the worst effects of the region’s debt crisis. The measure has risen 16 percent from this year’s low on Sept. 22.

Sarkozy Criticized for Seeking China’s Help(Source: Bloomberg)
French President Nicolas Sarkozy came under fire from opposition leaders for seeking China’s help to resolve the euro area’s debt crisis. “It’s shocking,” Martine Aubry, the general secretary of the Socialist Party, said in the Sunday newspaper, Journal du Dimanche. “The Europeans, by turning to the Chinese, are showing their weakness. How will Europe be able to ask China to stop undervaluing its currency or to accept reciprocal commercial accords?” Sarkozy reached out last week to his Chinese counterpart Hu Jintao to build support for an enlarged rescue fund designed to solve the region’s sovereign-debt crisis. The leaders talked just hours after a euro-region summit on Oct. 27 ended with an agreement to boost the European Financial Stability Facility to about 1 trillion euros ($1.4 trillion), leveraging existing guarantees by as much as five times.

Europe Seeking Crisis-Fighting Funds Faces Resistance Before Cannes G-20(Source: Bloomberg)
European governments are running into initial resistance as they seek to use this week’s Group of 20 summit to turn early praise for their revamped crisis- fighting strategy into financial support. The G-20 leaders convene Nov. 3-4 in Cannes, France, a week after euro-area authorities pledged to magnify the capacity of their rescue fund to 1 trillion euros ($1.4 trillion) and look beyond their borders for help in doing so as they combat the debt turmoil posing the biggest threat to global growth. While the help of China and cooperation of the International Monetary Fund were immediately sought, pledges of hard cash are proving hard to come by as G-20 members press for more details of the plan. In an indication Europe may eventually prevail, an official in Brazil’s government said it’s in talks with Russia, India, China and South Africa -- the so-called BRICS -- about possible joint assistance.
“Unless European leaders can flesh out some of these details very quickly, it’s hard to see the rest of the G-20 coming on board with very great enthusiasm,” said Eswar Prasad, a senior fellow at the Brookings Institution in Washington and a former IMF economist.

Draghi Takes ECB Helm in Battle Mode as Debt Crisis Torments Policy Makers(Source: Bloomberg)
Jean-Claude Trichet had almost four years to settle into the role of European Central Bank president before being thrown into crisis-fighting mode. Mario Draghi goes to battle on day one. Draghi, who succeeds Trichet tomorrow, becomes chief guardian of the euro with its 17-nation economy facing the risk of recession, a victim of the two-year-old sovereign debt crisis politicians are struggling to fix. As ECB president, he will be the second most powerful central banker in the world after Federal Reserve Chairman Ben S. Bernanke, and a key figure in the struggle to restore investor confidence in Europe’s monetary union. “This will be a baptism of fire for Draghi,” said Nick Kounis, head of macro research at ABN Amro Bank NV in Amsterdam. “It is challenging to be ECB president in any environment, let alone in the midst of a serious crisis.”

EU May Struggle to Keep Euphoria as Scrutiny Deepens Following Debt Summit(Source: Bloomberg)
European leaders may struggle to maintain the euphoria that drove the euro to its biggest one-day gain in more than a year as scrutiny deepens on their latest attempt to stem the region’s turmoil. European Central Bank President Jean-Claude Trichet called for “swift implementation” if financial stability is to be restored, Germany’s Bild Zeitung reported in an extract of an interview to be published tomorrow. The weaknesses of Europe’s common currency area, ranging from its design to a persisting dearth of bank funding and anemic economic growth, weren’t properly addressed in this week’s accord to stem investor panic, said Harvard University economist Kenneth Rogoff and Jonathan Loynes at Capital Economics Ltd. in London. “My read of this is that the markets are cheered that they’re still alive,” Rogoff, a former International Monetary Fund chief economist, said as a compensated speaker at the Bloomberg FX11 Summit in New York Oct. 27. “Even in a fairly short period, doubts will start to grow again.”

RBA Rate-Cut Bets Waver Amid 2011’s Steepest Bond Rout: Australia Credit(Source: Bloomberg)
Bond investors are showing doubts the Reserve Bank of Australia will cut the developed world’s highest benchmark interest rate as progress on solving Europe’s debt crisis spurs the biggest debt-market sell-off this year. Yields on Australian three-year notes rose 35 basis points since Oct. 7, the most in a three-week period since December, and exceeded 4 percent the first time since Aug. 4. They grew 24 basis points this month to 3.45 percentage points more than similar U.S. Treasuries, the biggest increase since April. Wagers that RBA Governor Glenn Stevens will lower borrowing costs for the first time in 31 months gyrated last week as data showing the slowest underlying inflation in 14 years was offset by optimism global financial turmoil will subside after European leaders expanded a bailout fund to aid heavily indebted nations. Cash-rate futures show a 74 percent chance the RBA will cut its 4.75 percent benchmark tomorrow, down from a 100 percent probability on Oct. 26.

Philippines May Keep Official Rates Steady for Near Term, Tetangco Says(Source: Bloomberg)
The Philippines can keep its benchmark interest rates steady for the “near term” given a “manageable” inflation outlook and barring surprises that may be caused by recent natural disasters in the region, central bank Governor Amando Tetangco said. “Right now, policy settings are appropriate,” Tetangco said in an e-mail reply to questions. Philippine monetary authorities will monitor the “process and speed of the resolution of the debt crisis in Europe, policy responses in other advanced economies to deal with unemployment” as well as growth and inflation prospects in China to “see how these would tip the balance of risks to inflation,” Tetangco said.

20111031 1026 Global Commodities Related News.

Funds Adding to Bullish Bets Fueling Biggest Rally Since 2009: Commodities(Source: Bloomberg)
Speculators boosted wagers on higher commodity prices by the most since August as improving prospects for growth in the U.S. and Europe sent prices toward their biggest rally in more than two years. Money managers boosted combined net-long positions across 18 U.S. futures and options by 13 percent to 831,421 contracts in the week ended Oct. 25, Commodity Futures Trading Commission data show. The Standard & Poor’s GSCI Index of 24 raw materials has jumped 10 percent in October, on track for the biggest gain since May 2009. European leaders announced a bailout plan Oct. 27 to help relieve the region’s debt crisis, and the U.S. economy grew by a more-than-expected 2.5 percent in the third quarter. The S&P 500 Index is headed for its largest monthly advance since 1974. The outlook for demand has recovered since September, when the GSCI fell 12 percent, the biggest monthly drop since November 2008, amid concern the global economy was set for another recession.

Corn (Source: CME)
US corn futures end higher on tight farmer selling and technical strength. While the market remains range-bound, technical traders are encouraged by December corn getting above its 200-day moving average. There's little supply-and-demand news, with traders already looking ahead to next month's USDA crop report. Some traders say this year's crop could fall lower than the agency's latest projection. Meanwhile, farmers are flush with cash and see little reason to sell, traders add. "The market is just waiting for another event," says Dave Marshall, an independent broker/advisor. CBOT December corn ends up 3 1/2c at $6.55/bushel.

Wheat (Source: CME)
U.S. wheat futures end mixed after trading both sides of unchanged, as support from corn is offset by lackluster demand. Traders note poor export demand thanks to a flood of competing Black Sea wheat is keeping a lid on the market. World supplies seen as ample, traders add. Corn was the upside leader, and gave support to wheat, as both are used for feed. Lingering worries about the winter wheat crop also supportive, although rain and snow in the southern Plains Thursday expected to help the crop. Dec CBOT wheat ends up 1/2c to $6.44 1/2 per bushel, while Dec. MGEX wheat closes up 2 1/2c to $9.20 1/2. Dec KCBT wheat ends flat at $7.38, while other contracts eke out small gains.

Rice (Source: CME)
US rice futures slump, ending lower as overseas demand for US rice remains weak. The Arkansas Farm Bureau notes that despite small gains Thursday, rice "didn't have the vigor seen in cotton & grains." Adds that the market's upside potential "may be limited by poor milled rice export demand." CBOT Nov rice ends down 20 cents to $16.74 per hundredweight.

US wheat dips after 4 pct rally, corn ticks down
SINGAPORE, Oct 28 (Reuters) - U.S. wheat slid 0.7 percent after last session's biggest jump in two weeks, while corn edged lower as the grain markets took a breather following a rally sparked by Europe's move to resolve its debt crisis.
"At the moment the market is getting a little bit depressed because of economic uncertainties that are still plaguing the world," said Abah Ofon, an analyst with Standard Chartered Bank in Singapore.

Thai 2011/12 paddy crop flood damage seen at 6 mln T
BANGKOK, Oct 28 (Reuters) - Thailand's worst flood in decades is expected to damage around 6 million tonnes of paddy from the current 2011/12 crop, a senior Agriculture Ministry official said on Friday.
"The 6 million tonnes damage is just an initial estimate. We need to conduct a survey again after flood water recedes," Apichart Jongsakul, head of the Office of Agriculture Economy, told Reuters, adding that this is from the major crop.

Argentina's Rosario port gets grains despite strike
BUENOS AIRES, Oct 27 (Reuters) - Grains shipping was normal at Argentina's key port of Rosario on Thursday despite a strike by trucking firms demanding that Buenos Aires province set a guaranteed minimum hauling tariff, an industry official said.
The FETRA group of trucking companies began striking earlier this week in Buenos Aires province and vowed to turn up the pressure by expanding their work stoppage to Rosario, in neighboring Santa Fe province.

Argentina corn area seen at 3.74 mln ha - exchange
BUENOS AIRES, Oct 27 (Reuters) - Argentine farmers will plant 3.74 million hectares with 2011/12 corn for commercial use, the Buenos Aires Grains Exchange said Thursday, down from its week-earlier estimate of 3.50 million hectares.
Recent rains in Argentina's central corn-growing areas have made it easier for growers to plant corn, but the exchange said it changed its area forecast for the world's No. 2 corn exporter for strictly methodological reasons.

EU maize exports outpace wheat this week
PARIS, Oct 27 (Reuters) - The European Union this week granted licences to export 165,000 tonnes of maize, outpacing 163,000 tonnes for soft wheat in a sign of strong demand for European maize.
The EU has now awarded 850,000 tonnes of maize export licences since the beginning of the 2011/12 (July-June) season, compared with just 272,000 tonnes a year ago, official data showed on Thursday.

IGC raises global maize crop to 855 million tonnes
LONDON, Oct 27 (Reuters) - The International Grains Council on Thursday raised its forecast for global maize production in 2011/12 by 10 million tonnes to a record 855 million tonnes accounting for improved prospects in producers including China and Ukraine.  
"Improved availabilities are expected to encourage additional feeding in some countries, with forecasts for China and the EU in particular, higher than before," the IGC said in a monthly report. It estimated the 2010/11 maize crop at 826 million.

Egypt extends ban on rice exports - minister
CAIRO, Oct 27 (Reuters) - Egypt has extended the ban on rice exports to ensure there is no shortage of supply, Trade Minister Mahmoud Eisa said on Thursday, adding that it was not clear yet when the ban in place since 2008 would be lifted.
The ban has been extended several times and was due for review in October. Analysts said the government was wary of any move that might hurt domestic supply or prices, stoking public frustration after an uprising that toppled Hosni Mubarak.

Ukraine grain exports still low in Oct 1-24
KIEV, Oct 27 (Reuters) - Ukraine's grain exports totalled about 1.0 million tonnes in October 1-24 against 1.07 million in the same period in September, UkrAgroConsult agriculture consultancy said on Thursday.
The consultancy said in a report the volume had included 173,000 tonnes of wheat, 275,000 of barley and 557,000 of maize.

Philippines sees '12 rice imports still around 500,000T
MANILA, Oct 27 (Reuters) - The Philippines' rice purchases next year may still hover an earlier estimate of 500,000 tonnes despite damages from recent typhoons and will unlikely match imports of the grain in 2011, the Agriculture secretary said on Thursday.
Manila, one of the world's biggest rice buyers, bought a total 860,000 tonnes of the grain this year and remains confident of becoming self-sufficient in the national staple in two years despite strong typhoons that hit the country at least 20 times in a year.-

IGC Ups China 2011-12 Corn Imports, Ukraine Exports Forecast (Source: CME)
The International Grains Council revised up China's corn import forecast for the year from July 1 by 33% to 4.0 million metric tons, which will make the country the six-largest importer by volume. It said China's imports will more than double from last year's 1.7 million tons. A recent price decline has triggered some additional purchases by China, it noted. Despite China's official reports that a record crop is currently being harvested, underlying feed and industrial demand is strong, availabilities appear tight and local prices remain close to all-time highs, particularly when internal transportation costs to southern parts of the country are taken into account, IGC said. China, which in theory aims for self-sufficiency in grains, started to import large quantities of U.S. corn last year and its purchases is one of the reasons for prices hitting a record high in June.
IGC also revised up Ukraine's corn exports forecast by 4.7% to 9.0 million tons. Ukraine exported 5.0 million tons of corn in 2010-11. It revised up Ukraine's corn output projections by 2.0 million tons to 18 million tons, 57% higher. A sharp rise in output and costlier, limited supply from the U.S., the top exporter, has prompted even East Asian buyers to turn to Ukraine to cover requirements, a rare development. IGC revised up Australia's wheat output projections for 2011-12 by 2.7% to 26.2 million tons and its export forecast by 7% to 18.5 million tons. It said Australia was saddled with multi-year high stocks of 8.6 million tons on Oct. 1 and stocks will be little changed a year later despite strong exports. China's wheat imports will likely hit 1.5 million tons, up 50% from an earlier forecast of 1.0 million tons, IGC said.

Bumper Australian Wheat Crop In The Making; Production Could Hit New Record (Source: CME)
Australia looks set to produce another bumper wheat crop with record production a distinct possibility, Brett Cooper, senior manager for markets at INTL FCStone's Sydney office, said. The market consensus is that with harvest slowly gathering pace, the new crop now is estimated in a range of 25 million metric tons to 26 million tons, he said. "But it has more potential to surprise to the upside rather than the downside," particularly with well above average yields seen in the northern wheat belt of Western Australia, he said by phone. Australian wheat production attracts global attention this time of year given the big impact a bumper crop can make to global supply. After domestic demand of around 6 million tons is met, the balance is usually available for export, making Australia one of the top five wheat exporters in the world.
Another market participant said production is broadly expected in a range of 24.5 million to 27.0 million tons. Some are predicting a record crop of 27 million tons as very much possible, exceeding the 26.3 million tons record set last crop year ended March 31. "The reason why you'd be supportive of a number like that is because in the autumn we had pretty good rain" and a strong price signal at planting time in May when benchmark ASX wheat futures for January 2012 delivery were quoting at A$310/ton, he said. This contract peaked in February at A$350/ton. "When you've got those kind of conditions, wheat seems to come out of nowhere," he said. "There's a bigger acreage out there than people think." Many industry participants now expect production in Western Australia to double to 9.5 million tons, making it the second biggest crop on record in Australia's biggest wheat producing state, he said.
In September, the Australian Bureau of Agricultural and Resource Economics and Sciences estimated output this crop year at 26.2 million tons, based on an estimate for Western Australia of 9.0 million tons. While the size of the crop is looking big, a soft finish to the season with good rainfall in September and October and mild temperatures in Western Australia and in the eastern states appear to be producing lower-than-usual protein levels in this year's crop.

Exchange Lifts Argentina 2011-12 Corn View On Good Conditions (Source: CME)
Conditions are good for corn planting in Argentina after recent showers soaked dry fields, leading farmers to increase the area they plan to seed with the grain, the Buenos Aires Cereals Exchange said in its weekly crop report. The exchange raised its forecast for 2011-2012 corn area to 3.7 million hectares, up from the 3.5 million hectares estimated last week. Argentina is the world's third-largest soybean exporter, ranks second in corn, first in soymeal and soyoil, and is a leading exporter of wheat and sunflower seed oil. Corn planting is progressing well after the recent showers. So far, 55.1% of the area expected to go to corn this season has been planted, down about 12 percentage points from the progress made at this point last year. Dry weather through September led many farmers to delay corn planting. So far, sunflower-seed planting is 38.5% complete, with 1.86 million hectares expected by the exchange this season.
Argentina's 2011-2012 wheat crop is developing well after the soaking, and production is expected to total at least 12.6 million tons, according to the exchange. Wheat production during the 2010-2011 season totaled 15 million tons, according to the U.S. Department of Agriculture. The harvest is set to kick off in December. Farmers are expected to plant 18.6 million hectares with soybeans in the upcoming 2011-12 season, up slightly from 18.5 million hectares last season, according to the exchange. Soy planting is just about to start in earnest.

Swiss Re Targets Vietnam As Crop Insurance Picks Up In Asia (Source: CME)
Frequently recurring natural disasters such as droughts and flooding in recent years is opening up a whole new business opportunity for the financial services sector as crop insurance gets increasingly popular in Asia. Swiss Reinsurance Company has helped design a rice insurance scheme in Vietnam and is re-insuring the same and the European insurer is exploring opportunities for similar products across Southeast Asia, a senior company official said. A pilot project for rice insurance has been launched in Vietnam and based on feedback, it may be expanded nationwide and replicated in other countries of the region, Swiss Re's Head of Agriculture for Asia-Pacific, Roman Hohl said in an interview. Southeast Asia which accounts for more than 50% of the global rice trade, is currently reeling under severe flooding. In Thailand, the worst hit by flooding this year, authorities have estimated that at least 14% of the standing crop has already been damaged.
Even though the annual deluge is not entirely new to the region, most of Asia still lacks proper crop insurance schemes. Crop risk management here has mostly involved post-disaster payments from a calamity fund or the national budget rather than a proactive approach in which insurance takes care of the compensation to farmers, Hohl said. Swiss Re will be one of the re-insurers for around 1.0 million hectares, or 13.5% of the annual rice acreage across 7 Vietnamese provinces, for the next three years under a yield-based index insurance. Farmers in a given district will be eligible for compensation if their yield falls below the average yield in the previous years. The entire district, not individual farms, will be taken as a single unit for calculating yields.
Hohl said the product is designed to cover major natural disasters such as typhoons, floods and droughts and there have been discussions with officials of other countries in the region to consider such products but their implementation will depend on the availability of an authentic database on yields. India is the only other country in South and Southeast Asia to have yield-based crop insurance in a big way. In China, it is mostly based on visual inspection of farms and is therefore more subjective and arbitrary, he said. In India, where Swiss Re re-insures agricultural crops, there are more than 20 million farmers, growing as many as 36 crops, insured under various schemes. Hohl said crop insurance has picked up in India in recent years after it has been packaged with agricultural loans and made a mandatory requirement for availing loans. Moreover, the government contributes an average 70% of the premiums, making it affordable to most farmers.
In the Vietnamese experiment, 60% to 100% of the premium will be paid by the government, depending on the income of the insured household. Government support for crop insurance - permissible under World Trade Organization rules - is very high even in developed countries such as the U.S. and Japan, he said.

Trigon Agri Chairman: To Up Harvest Area To 140,000 Hectares In 2012 (Source: CME)
Swedish-listed Trigon Agri A/S is set to post its first full-year profit ever and with plans to increase the harvested area next year the founder and Chairman Joakim Helenius is positive about the future. Estonia-based Trigon Agri, which was established in 2006, is an agricultural company focused on Russia and the Ukraine where the company produces, stores and trades soft commodities with wheat and sunflower seeds its largest crops. After a history of losses, Trigon Agri this summer posted a net profit of EUR16 million for the period January to June and Helenius calls 2011 a break-through for the firm. "We have become a clearly profitable company and it's the first time a company in our peer group has achieved this," Helenius said in an interview. The Chairman said the black figures were achieved through a combination of lower costs and better yield, measured in metric tons/hectare, and sees further improvement ahead.
Next year, Trigon aims at increasing the harvested area to around 140,000 hectares from around 90,000 hectares today. The rise will come from greater use of the around 179,000 hectares the company currently controls and Helenius said the firm's financial situation is now "very, very good", enabling Trigon to finance this plan. "This should affect our result very positively," Helenius said. Trigon is also working on improving efficiency, to attain a higher yield, and aims at having on average seven employees per 1,000 hectares compared with today's 10. Yet, despite efforts to cut costs and increase yields, the firm remains vulnerable on weather conditions. Last year, Russia was hit by a severe drought, slashing its harvest and leading the Kremlin to impose an export ban that wasn't removed until this summer.
This year, Russia had wet weather that brought forward the harvest. Trigon has so far completed around 85% of its harvest. "This is no good year, but it isn't bad either. We can live with a year like this," Helenius said. Trigon Agri also runs a number of dairy farms, in Estonia as well as in the St Petersburg region of Russia, and the firm's chairman said he is planning to expand this business. "There is an enormous opportunity to build up a large commercial milk business in Russia," said Helenius. The average farm in Russia has only three cows while Estonian farms are the most efficient milk producers in the European Union. The company has previously talked about listing its dairy operations. Helenius said that Trigon is now instead looking at taking in a larger co-investor to help finance the dairy expansion and delay a possible listing. "When the business is big enough and the market more promising we will look at a listing," he said.
After Goldman Sachs this summer published an upbeat note on milk, interest for the dairy business has increased. "There are a lot of investors interested in milk. It can be a profitable business and it is a business I really believe in," said Helenius.

Sugar, coffee firm, buoyed by euro deal
LONDON, Oct 28 (Reuters) - ICE sugar, coffee and cocoa futures firmed in early trade, with investors remaining buoyant due to a deal struck by euro zone leaders earlier this week to help end the bloc's debt crisis.
Raw sugar futures edged up on light technical buying, with scope for upside limited by a firmer dollar.

Ruined roads after storms put CentAm coffee at risk
EL PARAISO, Honduras, Oct 27 (Reuters) - After weeks of torrential rains, tractors, trucks and bulldozers are working overtime in El Paraiso in southern Honduras, scrambling to repair washed-out bridges and collapsed roads before the harvest begins in Central America's No. 1 coffee producer.
If they fail, up to 20 percent of the country's crop could be at risk, says the congressional coffee commission.

Russia govt mulls keeping sugar import duty high
MOSCOW, Oct 27 (Reuters) - Russia, which expects a record output of sugar from domestic beets, is considering a proposal to keep its import tariffs on raw sugar high to prevent unnecessary imports, a senior government official said on Thursday.
"There is a proposal not to lower the tariff next summer," Deputy Economy Minister Andrei Slepnyov said.

Promising biodiesel crop needs time to prove itself
LONDON, Oct 27 (Reuters) - Several new companies are betting on the little-known pongamia pinnata tree as a biodiesel feedstock that does not hurt food production, but a decade or more of research and development is still needed to determine its value as a commercial crop.
Pongamia pinnata, also known as millettia pinnata, is native to Australia, India and parts of southeast Asia. Its oil has so far been used in medicines, lubricants and oil lamps.

Crude Oil Heads for Biggest Monthly Increase Since May 2009 in New York(Source: Bloomberg)
Oil in New York headed for the biggest monthly gain in more than two years amid Europe’s efforts to contain its sovereign-debt crisis. Brent crude’s premium to New York futures traded near a four-month low. Futures were little changed after rising as much as 0.5 percent. Prices have surged 18 percent in October, the biggest increase since May 2009. European Central Bank President Jean- Claude Trichet called for “swift implementation” of an agreement last week on measures to stem the region’s debt crisis, Germany’s Bild Zeitung reported. Crude for December delivery was at $93.11 a barrel, down 21 cents, in electronic trading on the New York Mercantile Exchange at 8:11 a.m. Singapore time. Prices dropped 0.7 percent to $93.32 a barrel on Oct. 28, paring the biggest weekly increase since February.

COLUMN-Is Asia heading down the wrong energy path?: Clyde Russell
--Clyde Russell is a Reuters market analyst. The views expressed are his own.--
SINGAPORE, Oct 27 (Reuters) - "Securing energy supplies" is a catchphrase that's become incredibly overused in Asia in recent years as virtually every country in the world's fastest-growing region competes to fuel economic expansion.
It's a theme sure to re-emerge at the Singapore International Energy Week, a top-level gathering in the city state from Oct. 31 to Nov. 4 that will address not only supplies, but also efficiencies and abating carbon pollution.

Euro Coal-prices rise on European debt relief
LONDON, Oct 27 (Reuters) - European prompt physical coal prices rose on Thursday as markets reacted with relief to the European Union's agreement to tackle the euro zone's sovereign debt crisis.
Physical demand remained thin because some players with long positions lack the capacity to burn coal and as many utilities are burning down their stockpiles before ordering new deliveries, traders said.

China Coal-Prices climb, but appetite for imports anemic
SHANGHAI, Oct 27 (Reuters) - China's thermal coal prices climbed for a seventh week to more than 850 yuan ($133.80) a tonne as a cold snap in parts of the country aided demand, but traders said appetite for imports was anemic with most power plants in the southern coasts well stocked.
Most power plants have fairly full inventories with close to three weeks worth of consumption, while some Chinese buyers said they were also unwilling to bet that prices would march significantly higher in the coming winter months due to the murky economic outlook.

Bangladesh crude oil import seen up in 2012 -BPC official
DHAKA, Oct 28 (Reuters) - Bangladesh's crude oil import will rise by 17 percent to 1.4 million tonnes in 2012, with spending likely to go up by 18 percent to $1.3 billion, a senior Bangladesh Petroleum Corporation (BPC) official said on Friday.
Of the total, 700,000 tonnes of Murban crude will be imported from Abu Dhabi National oil Company and another 700,000 tonnes of Arab Light crude will be sourced from Saudi Aramco, the official told Reuters.

PetroChina runs at full pace, boosts imports amid diesel shortage
BEIJING, Oct 28 (Reuters) - PetroChina Co Ltd , China's second-largest refiner, has asked its refineries to run at full rates to boost fuel production and has raised diesel imports since July to overcome domestic diesel shortages.
PetroChina has imported 280,000 tonnes of diesel since July, 122 percent more than its whole diesel imports in 2010. Diesel imports so far in October stood at 120,000 tonnes, according to a report posted on the website of its parent company, China National Petroleum Corp (

Petronas: policy to award licences to oil/gas firms stands
KUALA LUMPUR, Oct 28 (Reuters) - Malaysia's state oil firm Petronas said on Friday it has not changed its policy of awarding licences to companies involved in its oil and gas production areas.
Petronas denied a local media report that said it would abolish its licensing system as part of a move to encourage greater competition in the oil and gas industry.

Tin Producers in Indonesia to Extend Export Ban to Yearend to Boost Prices(Source: Bloomberg)
Fifteen tin producers in Indonesia, the world’s largest shipper, agreed to extend a self-imposed ban on exports until the end of the year to help boost prices. They will seek to widen support for the halt at a meeting this week. The companies took the decision at a meeting in Pangkalpinang, Bangka Belitung province on Oct. 28, said Johan Murod, director at PT Bangka Belitung Timah Sejahtera, a group of six smelters. The producers are seeking to hold a bigger gathering involving all miners on Nov. 2, said Rudy Irawan, deputy chairman of the Indonesian Tin Industry Association. Indonesian companies suspended exports from Oct. 1 after the metal lost 17 percent in September on concern Europe’s debt crisis may derail the global economy. Producers have said that shipments won’t resume until prices rebound to $25,000 per metric ton, from $22,100 on Oct. 28. The country represents more than 40 percent of global exports, according to Peter Kettle, research manager at St. Albans, England-based ITRI Ltd.

Iron Ore-Spot price on course for worst week ever
SINGAPORE, Oct 28 (Reuters) - Spot iron ore prices are headed for their worst week ever as miners continued to ship cargoes even as demand from top consumer China remained slack.
But stabilising prices of forward swaps and growing inquiries from Chinese steel mills suggest the freefall in iron ore -- which has lost 34 percent of its value since early September -- may soon hit a bottom.

Iron ore extends losses as China demand slows
SINGAPORE, Oct 26 (Reuters) - Iron ore extended losses on Wednesday and was on course for its   steepest ever weekly price slide as slowing growth in top consumer China curbed steel prices and hit demand for the steel-making raw material.
China's appetite for iron ore has weakened along with slowing demand for steel from its construction sector, pushing down prices for iron ore by about 30 percent since early September.

China imported iron ore stocks rise in wk ending Oct 28
BEIJING, Oct 28 (Reuters) - Inventories of imported iron ore at major Chinese ports ended this week at 92.74 million tonnes, up 520,000 tonnes from the end of last week, figures from industry consultancy Mysteel showed on Friday.
Stockpiles of ore from all three major exporting nations, Australia, Brazil and India, inched up over the week, with shipments still arriving despite a collapse in prices.

Vale keeping iron output strong despite price drop
RIO DE JANEIRO, Oct 27 (Reuters) - Brazilian mining giant Vale  joined its rivals in pledging on Thursday no let up in iron ore production, even as prices slump, European buyers cancel cargoes and Chinese steelmakers clamor for price relief.
Signaling a firm belief that the nearly 30 percent slump in spot market prices this month is a temporary blip, executives of the world's biggest iron ore producer said Chinese monetary policy easing should help bolster demand from its top consumer.

China spot nickel demand falls as steel mills slow buying
HONG KONG, Oct 27 (Reuters) - China's demand for refined nickel is weakening as stainless steel mills, its top end-users, cut purchases of spot metal, driving up stocks and squeezing prices, traders said on Thursday.
Stainless steel mills' purchases of spot refined nickel to replace nickel pig iron (NPI), a low grade ferro-nickel with high iron content, have been falling this month, after a rise in August and September, when NPI prices were steady, traders said.

Copper Traders See End to Record Rally as China Demand Slows: Commodities(Source: Bloomberg)
Copper traders and analysts are forecasting an end to the biggest weekly rally since at least 1986 on concern demand will slow in China while Europe’s lingering financial crisis limits growth. Eleven of 23 people surveyed by Bloomberg say copper will drop next week, eight predicted a gain, and four said prices will be little changed. The last time respondents were mostly bearish, on Sept. 23, the metal slumped 4.6 percent in the following week. Traders also predicted lower sugar prices next week, and gains in gold, corn and soybeans.
While copper surged 14 percent this week as European leaders agreed to expand the region’s bailout fund, the metal is down 20 percent from a record on Feb. 15, the common definition of a bear market. Global output exceeded demand in the eight months through August, the World Bureau of Metal Statistics said on Oct. 19. Goldman Sachs Group Inc. and UBS AG cut their copper forecasts for 2012 this month, and economists surveyed by Bloomberg predict slower growth next year in Europe and China, the world’s largest metal user.

Gold Declines From Five-Week High in N.Y. Amid Renewed Europe Debt Concern(Source: Bloomberg)
Gold declined from a five-week high on renewed concerns that Europe’s debt crisis will hamper global growth, damping prospects for commodity demand. Italy’s borrowing costs rose to a euro-era record at a sale of three-year bonds. The Standard & Poor’s GSCI Index of 24 raw materials slumped as much as 1.3 percent. A rebound in the dollar also reduced demand for gold as an alternative asset. “Fresh fears about Italy are pushing all commodities, including gold, lower,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview. “We are also witnessing some profit taking.”

Baltic index falls, rising congestion eyed
LONDON, Oct 26 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, turned negative on Wednesday although cargo bookings to China and growing port congestion were supporting the larger capesizes.
Brokers said they were watching iron ore price developments, which remained a major market factor.

Dry ship deliveries to reach highest ever in 2011
LONDON, Oct 26 (Reuters) - Deliveries of new dry bulk ships are on course to reach their highest level ever this year and fleet expansion is expected to remain strong in 2012, ship broker SSY said on Wednesday.  
Despite a recent rally on the larger capesize market, brokers and analysts expect vessel supply, which has outpaced commodity demand, to cap dry bulk freight rate gains in coming months with economic uncertainty adding to headwinds.

20111031 1025 Soy Oil & Palm Oil Related News.

ITS CPO export up 8.5% to 1,650,415 tonnes for the period of 1~31 Oct 2011.
SGS CPO export up 11.9% to 1,684,077 tonnes for the period of 1~31 Oct 2011.

Soybeans (Source: CME)
US soy futures stumble, ending lower on poor export demand and a lack of crop worries. Gulf export basis continued to erode as sales remain weak, and traders say the lack of sales is a key negative factor. Meanwhile, "you couldn't script a better start to the growing season in South America," says Joel Karlin, Western Milling analyst. Strength in the US dollar, which had tumbled on Thursday, added to the pressure, although that didn't prevent gains in wheat and corn. CBOT Nov soybeans end down 18c, or 1.5%, to $12.17 a bushel.

Soybean Meal/Oil (Source: CME)
Soy products join in the decline. Soymeal is suffering from weak demand, and CBOT Nov. soymeal falls $6.0 to $317.5 per short ton. Nov soyoil ends down .34c to 51.77 cents/lb.

Soybeans Fall as Improving South American Crops May Cut U.S. Export Demand(Source: Bloomberg)
Soybean futures posted their biggest drop in more than a week on speculation that improving prospects for South American crops will cut demand for supplies from the U.S. Dry weather the next seven days will accelerate planting in Argentina and Brazil, the world’s biggest exporters after the U.S., and rains beginning Nov. 8 may boost early crop development, World Weather Inc. said today in a report. As of Oct. 20, export sales for the marketing year that began Sept. 1 were 33 percent smaller than a year earlier, government data show. “South American weather looks promising,” Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa, said in a telephone interview. “With improving crop prospects in Brazil and Argentina, people are focused on the slowing U.S. export pace.” Soybean futures for January delivery fell 1.4 percent to close at $12.26 a bushel at 1:15 p.m. on the Chicago Board of Trade, the biggest drop since Oct. 19. The slump pared this week’s gain to 0.4 percent.

Palm dips; EU debt deal checks losses
JAKARTA, Oct 28 (Reuters) - Malaysian palm oil futures eased slightly, snapping a four-day winning streak, but prices remained near a five-week high as optimism stemming from a deal to solve Europe's debt problems checked losses.
"A lot of profit taking is going on, once prices hit the 3,000 level," said a Kuala Lumpur-based trader. "The longs will have to stay cautious for the time being.

Friday, October 28, 2011

20111028 1110 Global Market & Commodities Related News.

GLOBAL MARKETS-European debt deal ignites rally in stocks, euro
NEW YORK, Oct 27 (Reuters) - A long-awaited plan to staunch the European debt crisis sparked euphoria across financial markets on Thursday, driving up the euro and the price of world stocks and commodities, while thrashing the dollar.
"This is not a magic elixir. It's a very good start and certainly more than people had expected," Bill O'Neill, partner at commodity investment firm LOGIC Advisors, said of the deal.

COMMODITIES-Prices surge as investors toast Europe deal
NEW YORK, Oct 27 (Reuters) - Oil rebounded from a one-day fall to resume a powerful rally from earlier in the week and metals and crops also surged on Thursday as markets rejoiced over Europe's plan to conquer its two-year-old debt crisis.
"This is not a magic elixir. It's a very good start and certainly more than people had expected," Bill O'Neill, partner at commodity investment firm LOGIC Advisors and a commentator on gold, said after bullion prices rose without a break from Friday, finishing up 8 percent over the five days.

China’s Stocks Rise, Extending Best Week in Year, on Profit, U.S. Economy (Bloomberg)
China’s stocks rose, driving the benchmark index to its best weekly gain in a year, after PetroChina Co. reported profit that beat analysts’ estimates and the U.S. economy grew at the fastest pace in a year. PetroChina, China’s biggest oil company, led gains for energy producers after third-quarter net income rose 7.8 percent. Industrial & Commercial Bank of China Ltd., the largest lender, surged for its best five-day rally since November 2010 after reporting a 28 percent jump in profit. Jiangxi Copper Co., the biggest producer of the metal, jumped to a one-month high as commodity prices surged on an improving global economic outlook. “The market sentiment is getting better and investors are not that pessimistic as they were a couple of weeks ago,” said Zhang Qi, an analyst at Haitong Securities Co. in Shanghai. “We’ll see some real actions from the government to ease tightening policies as inflation slows.”

Japan Stocks Advance Second Day as U.S. Growth Fuels Rally After Debt Deal (Bloomberg)
Japanese stocks rose for a second day, pushing the Nikkei 225 (NKY) Stock Average toward its biggest weekly gain in a year, as faster U.S. economic growth fueled investor confidence following yesterday’s breakthrough on a European debt deal. Honda Motor Co. led gains among carmakers, rising 4.6 percent. Mitsubishi UFJ Financial Group Inc., Japan’s biggest lender by market value, advanced for a second day after European leaders yesterday stuck a deal that may help avert a financial crisis. Komatsu Ltd., a maker of construction equipment, jumped 6.2 percent after announcing a share buyback. The Nikkei 225 Stock Average climbed 1.4 percent to 9,048.35 at the 11 a.m. trading break in Tokyo. For the week, the gauge is headed for a 4.3 percent gain, the biggest since the period ended Nov. 5, 2010. The broader Topix index rose 1.5 percent to 774.20. A report that the U.S. economy grew last quarter at the fastest pace in a year helped stocks extend yesterday’s gains.

Oil rallies more than 4 pct on EU rescue deal
NEW YORK, Oct 27 (Reuters) - Crude oil futures rallied more than 4 percent on Thursday, primed by a deal on Greek debt that many analysts said bodes well for resolving the euro zone crisis.
"Given the positive nature of today's GDP report, as well as settling of some European debt concerns, the path has been paved for bullish moves in coming sessions for commodity and equity prices," said Jason Schenker, president of Prestige Economics LLC in Austin, Texas.

Nov natgas expires on weak note, EIA, weather weigh
NEW YORK, Oct 27 (Reuters) - U.S. natural gas futures ended lower on Thursday, with the front-month November contract expiring on a weak note after another big weekly inventory build and ahead of milder weather forecast for next week.
"The (EIA) number was above consensus, and the forecasts went warmer after this cold snap," a Texas trader said, noting cold weather for the next few days should help support prices but strong production was still a problem for the bulls.

Euro Coal-prices rise on European debt relief
LONDON, Oct 27 (Reuters) - European prompt physical coal prices rose on Thursday as markets reacted with relief to the European Union's agreement to tackle the euro zone's sovereign debt crisis.
"Two things are preventing activity from returning to the physical coal market: Firstly, utilities need to burn their stock down, and secondly the market needs to lose its fear of a renewed recession in Europe," one coal trader said.