Wednesday, July 27, 2011

20110727 1813 FCPO EOD Daily Chart Study.

FCPO closed : 3130, changed : +11 points, volume : lower.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : weakening, buyer reducing position.
Support : 3100, 3070, 3050, 3020 level.
Resistance : 3150, 3200, 3250, 3270 level.
Comment :
FCPO closed recorded small gain with slower volume transacted while overnight soy oil closed higher and currently trading little higher.
Weaker U.S. Dollar, disappointing soy crop data and heating up weather over palm oil estate factor provide support to FCPO price to trade little higher.
Daily chart formed a small doji bar candle position in between middle and upper Bollinger band level after market opened little higher and traded side way within tight 16 point range bound market to closed near opening price.
Technical study suggesting market is likely to trade side way range bound little upside biased 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.

20110727 1759 FKLI EOD Daily Chart Study.

FKLI closed : 1552 changed : -7 points, volume : higher.
Bollinger band reading : downside biased.
MACD Histrogram : resumed lower again, seller holding on.
Support : 1550, 1540, 1530, 1515 level.
Resistance : 1565, 1570, 1580, 1590 level.
Comment :
FKLI closed recorded loss with getting better volume exchanged doing 6 points discount compare to cash market that closed lower while Asia markets closed mixed bouncing between gain and losses and European markets currently trading mostly lower with overnight U.S. market closed recorded loss.
Full of uncertainty over endless argument between Democrat and Republican ways to raise U.S. debt limit lead regional market to trade directionless. News wise, Bloomberg survey shows that U.S. durable-goods orders rose 0.3 percent in June after a 2.1 percent gain in May, according to the median of 75 economists’ forecasts in a Bloomberg and news on Chinese industrial companies’ profits grew at a faster pace even after the government raised interest rates and tightened credit to counter inflation.  
FKLI daily chart formed a down doji bar candle closed nearer to lower middle Bollinger band level after market opened lower, climb upwards above 1560 level and traded side way followed by some selling activities press price lower with some last minutes sell down triggered some stop loss order and closed recovered slightly to closed near the low of the day.
Chart study suggest that market is likely to trade downside biased for the near term with possible pullback correction 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.

20110727 1550 Latest Surging Grain Prices To Fuel Asian Inflation Report by Reuters.

Dear All,
Here is the latest Surging Grain Prices To Fuel Asian Inflation Report by Reuters. Here's the link : Surging Grain Prices To Fuel Asian Inflation Reseach. Enjoy !

20110727 1532 Global Market & Commodities Related News.

Gold up on lack of US debt progress; stocks flat
SINGAPORE, July 27 (Reuters) - Gold prices hit a record high at more than $1,623 an ounce and Asian stock markets were largely flat, as news out of Washington indicated politicians were making little progress in ending the deadlock over lifting the U.S. debt ceiling.
Republicans had to delay bringing a plan to a vote in the U.S. Congress because it was being rewritten, while an analyst at Standard & Poor's told CNBC that prioritising debt payments to avoid a default would be "deeply disruptive" to the economy.

Bloomberg : U.S. durable-goods orders rose 0.3 percent in June after a 2.1 percent gain in May, according to the median of 75 economists’ forecasts in a Bloomberg survey before a Commerce Department report due at 8:30 a.m. in Washington. Bookings excluding transportation equipment increased 0.5 percent, the survey showed.

China’s 29% Jump in Industrial Profit to Spur Growth by Fueling Investment (Bloomberg)
Chinese industrial companies’ profits grew at a faster pace even after the government raised interest rates and tightened credit to counter inflation. Net income climbed 28.7 percent in the first six months to 2.41 trillion yuan ($374 billion) from a year earlier, the National Bureau of Statistics said today. That compares with a 27.9 percent gain in January through May. Climbing profits for companies such as Anhui Conch Cement Co., the nation’s biggest cement producer, fuel investment that is underpinning the expansion of the fastest-growing major economy. The International Monetary Fund forecasts that gross domestic product will rise 9.6 percent this year, also bolstered by a government plan to build millions of low-cost homes.

U.S. corn eases after surging on yield worries
SYDNEY, July 27 (Reuters) - U.S. corn futures posted modest falls in early Asian trade  as investors locked in profits after sharp gains the previous session on renewed concerns about sizzling temperatures stressing crops in the U.S. Midwest.
Chicago Board of Trade (CBOT) corn for December delivery , the most actively traded harvest month contract, fell 0.29 percent to $6.84-3/4 per bushel, after surging 1.7 percent on Tuesday, the biggest percentage gain in nearly two weeks.

US corn crop seen below 13 bln bushel in 2011-FCStone
MELBOURNE, July 26 (Reuters) - U.S. corn output this year is likely to be below 13 billion bushels due to hot weather, compared with an USDA estimate for 13.47 billion, but price gains would be capped by demand rationing, the president of brokerage INTL FCStone said.
Sizzling heat across the U.S. grain belt last week may have hurt yields, especially for corn, which is in the critical pollination stage, but cooler weather and scattered showers this week could benefit stressed crops.

Vietnam rice export prices up 3 pct on Indonesia deal
HANOI, July 27 (Reuters) - Vietnamese rice export prices have risen as much as 3 percent in the past week after news that Vietnam had struck a deal to sell 500,000 tonnes to Indonesia, traders said on Wednesday.
"Prices have jumped around $20 a tonne and farmers are holding back the newly harvested paddy, making it hard to strike any other commercial deals now," a trader at a foreign company in Ho Chi Minh City said.

Wheat yields in southern N.Dakota seen lower--Tour
MANDAN, North Dakota, July 26 (Reuters) - Spring wheat yields were projected to decline this year in the southern half of North Dakota as a late start to the planting season and excessive moisture stressed the crop, allowing diseases to thrive, an annual tour found.
Huge pools of standing water covered large swaths of farmland across the state, submerging fields of corn, hay and hard red spring wheat.

Asian wheat buyers to step up buying after June slowdown-trade
MELBOURNE, July 27 (Reuters) - Asian wheat buyers are likely to boost purchases to cover supplies for September and October after a slowdown in buying since June on volatile prices, traders said on Wednesday.
Indonesia is expected to buy 150,000 tonnes for September, and 200,000 tonnes for October delivery, while Thailand is likely to take around 100,000 tonnes for arrival in September and October, traders told Reuters at a grains industry conference in Melbourne.

Brazil cane crush gains on last season, outlook dim
BRASILIA, July 26 (Reuters) - Crushing of cane in Brazil and production of sugar and ethanol made from it are catching up with the 2010 season, data from cane industry association Unica showed on Tuesday, but the crop may soon run out of puff.
The crush totaled 217.4 million tonnes from the start of the season through July 16. That was 15 percent less than by the same time last season but the gap had narrowed from a lag of 18 percent at the start of July.

Weekend rains help corn, soy in northern US Midwest
CHICAGO, July 26 (Reuters) - Rainstorms that hit the northern U.S. Midwest during the weekend arrived just in time for farmers like Larry Hummel of Illinois who saw a heatwave suck up excess moisture that had been stored in the soil since a wet spring.
"I did notice that right at the end of the week, it (the stress) was starting to show up in the crops," said Hummel, who planted about 2,500 acres of corn and 1,200 acres of soybeans this year.

Argentina allows 450,000 tonnes more in wheat sales
BUENOS AIRES, July 26 (Reuters) - Argentina's government approved the export of another 450,000 tonnes of 2010/11 wheat on Tuesday, saying farmers had declared additional stocks.
Argentina is a major wheat exporter, but the government restricts international shipments to ensure domestic supply as it grapples with high inflation. Corn shipments are also curbed with a quota system of export permits.

CHICAGO, July 27 (Reuters) - This year's U.S. corn crop continues to be defined by a widening gap between the state of crops on the western versus eastern sides of the Corn Belt. Key states on the western side such as Iowa and Minnesota boast higher overall corn crop condition ratings than their Eastern counterparts such as Illinois and Indiana after persistent wet conditions out east substantially delayed farmer activity.
But the more advanced state of the western belt crops could have left them more vulnerable to yield loss during last week's heat wave than the less advanced corn growing in the east, ensuring that the recent west versus east story may show further twists before the end of the season.

Sugar price spike to crumble as surplus looms (Reuters)
Sugar prices are forecast to fall from 30-year highs, with India rushing to raise exports and cash in, while port delays at top exporter Brazil ease, but crop problems persist.

Oil falls as U.S. debt crisis drags on; stocks gain unexpectedly
SINGAPORE, July 27 (Reuters) - Oil fell  as a stalemate in the United States over raising the debt ceiling dragged on, with analysts saying the wrangling had already damaged the economy.
"The debt saga in the U.S. is weighing on both the futures contracts, and prices will remain rangebound till the time this issue is resolved," said Victor Shum, an analyst at Purvin & Gertz.

Chevron signs Wheatstone LNG sales deal with TEPCO
SYDNEY, July 27 (Reuters) - Chevron signed a liquefied natural gas supply deal with Tokyo Electric Power Company (TEPCO), giving Japan, the world's biggest LNG importer, a supply boost as it seeks more LNG after a huge earthquake in March crippled parts of its nuclear energy sector.  
Chevron  agreed to supply TEPCO  with 3.1 million tonnes of LNG per year for up to 20 years from its $25 billion Wheatstone project in Australia and also offered equity stakes in parts of the project, it said in a statement on Wednesday.

Mongolia state-owned miner signs coal deal with China's Chalco
ULAN BATOR, July 27 (Reuters) - Mongolia's state-owned miner Erdenes Tavan Tolgoi (TT) has agreed to sell $250 million worth of coal from the east Tsankhi deposit to Aluminium Corp of China Ltd (Chalco), a move insiders said was aimed at raising cash to help fund its impending listing fees.
Under the agreement, Chalco  would resell 30 percent of the coal to Japanese trading houses Itochu Corp  and Mitsui  as well as state-owned Korea Resources Corp (KORES), Erdenes TT LLC said in a statement seen on Wednesday.

Malaysian oil cos KNM, Zecon sign $5.7 bln projects, shrs up
KUALA LUMPUR, July 26 (Reuters) - Malaysian oil and gas companies KNM Group  and Zecon  signed a preliminary agreement with Gulf Asian Petroleum to undertake two projects worth 17 billion ringgit ($5.7 billion), boosting their shares.
Shares of Zecon rose as much as 30 percent, their biggest one-day percentage gain in nearly two years, while KNM shares rose as much as 9.1 percent.

LME copper extends gains on Chile supply risk
SHANGHAI, July 27 (Reuters) - London copper futures rose for a second day  as  supply worries brought on by an extended strike at the world's largest copper mine countered concerns over protracted talks in the United States to lift its debt limit.
"There's no doubt that this raises the risk that the deficit will be bigger than the markets are expecting," said Ben Westmore, commodity economist at National Australia Bank.

No end in sight to Escondida strike as mediation fails
ANTOFAGASTA, Chile, July 26 (Reuters) - A five-day strike at Chile's giant Escondida mine appeared far from ending after the mine snubbed government mediation on Tuesday, threatening to spread labor turmoil in the world's top copper producer.
Escondida, majority owned by BHP Billiton , dug in on Tuesday, refusing a labor authority invitation for talks and taking a hard line that could prolong the disruption at a mine that extracts 7 percent of the world's copper.

Namibia's mining body says new tax will curb investment
WINDHOEK, July 26 (Reuters) - Namibia's Chamber of Mines wants the government to reconsider plans to impose a further 17 percent tax on exploration and mining firms in the southern African producer of diamonds and uranium, saying it would discourage investors.
Namibia said on Friday it would increase mining corporate tax to 44 percent for miners other than diamond producers.

Albanian miners fast as strike in mine escalates
TIRANA, July 26 (Reuters) - A group of Albanian miners have entered the second day of a hunger strike to press Austrian miner DCM DECOmetal to meet their demands for a 20 percent pay rise and fresh investment, a union leader said on Tuesday.
Taf Koleci, president of the federation of trade unions of Albanian industrial workers, said 16 miners have been fasting for 30 hours now in a gallery 1,400 metres below surface, or 260 metres below sea level. Koleci had visited them.

Gold hits record; US debt uncertainty grows
SINGAPORE, July 27 (Reuters) - Spot gold hit an all-time high, for the sixth time in two weeks, as worries about whether the United States can avert a debt default grew while the country's two key political parties are still locked in a stalemate in debt ceiling talks.
"The same arguments about potential government bond fallout are still being made," said a Singapore-based trader, "but people are on the sidelines ahead of the August deadline waiting to see whether or not the U.S. is going to avoid a technical default."

20110727 1115 Global Market & Commodities Related News.

GLOBAL MARKETS: Dollar falls, gold rises with no US debt progress
SINGAPORE, July 27 (Reuters) - Asian stocks and the U.S. dollar fell on Wednesday while gold hit a record high at more than $1,623 an ounce, as a drip feed of news out of Washington indicated politicians were making little progress on a plan to lift the U.S. debt ceiling.
The Australian dollar jumped to a post-float high above $1.1050 after second quarter inflation figures were higher than forecast, squeezing investors who had recently increased bets that the Australian central bank would cut rates this year.

Longer Atlantic hurricane season possible, says forecaster
Signs of a developing La Nia system could raise hurricane activity in a 2011 season already forecast to have 16 major storms, says Matt Rogers of Commodities Weather Group.

OIL: Oil up in seesaw trading, weak dollar lifts
NEW YORK, July 26 (Reuters) - Oil prices edged up in choppy trading on Tuesday, lifted by a weak dollar while markets were buffeted by the continued stalemate over the U.S. debt ceiling that hemmed in Wall Street.
"U.S. crude found support among technical traders, with support coming in at $98. Small buyers are going in, but the big ones are still biding their time," said Richard Ilczyszyn, senior market strategist at Lind-Waldock in Chicago.

US House passes bill to speed up oil sands pipe review
WASHINGTON, July 26 (Reuters) - The U.S. House of Representatives on Tuesday approved legislation that would set a firm deadline for the Obama administration to decide the fate of a proposed $7 billion pipeline that would transport Canadian oil sands crude to the U.S. Gulf Coast.
The House voted 279-147 in favor of the bill that would force the State Department to approve or deny a permit for TransCanada's  planned Keystone XL pipeline by Nov. 1.

Brazil fuel imports to rise 10 pct in 2011
RIO DE JANEIRO, July 26 (Reuters) - Brazil's fuel imports will likely rise ten percent this year compared to 2010, state oil company Petrobras said on Tuesday, a further sign of the country's growing importance in global oil products markets.
The news comes a day after Petrobras said it was delaying start-up of its 300,000 barrel per day (bpd) Premium I refinery to 2016 from 2014, leaving less refining capacity than expected to meet Brazil's growing fuel demand.

NATURAL GAS: Natural gas ends down for 2nd day, mild temps weigh
NEW YORK, July 26 (Reuters) - U.S. natural gas futures ended down slightly on Tuesday for a second day, as milder Northeast and Midwest weather early this week continued to weigh on prices despite warmer late-week forecasts that should crank up air conditioning again.
"I'm surprised we couldn't move higher with all the heat, but there's a lot of supply around, so prices may be capped," a Pennsylvania-based trader said, noting front-month futures stalled last week in the $4.50s despite record heat.

EURO COAL: Prices creep higher on oil, S.Africa strike
LONDON, July 26 (Reuters) - Prompt physical coal prices crept higher by 50 U.S. cents a tonne on Tuesday for the third day running, boosted by a rise in oil and the spreading effects of South African miners' strike.
"Prices have very slowly been moving higher over the past few days but there are various reasons for that - oil, the strike, the dollar looking weaker - no one factor you could pin it on," one European trader said.

COMMODITIES: Corn, copper lead broad rise; US debt fear hits dlr
NEW YORK, July 26 (Reuters) - Commodities rose broadly on Tuesday, with copper and corn outperforming the pack, as fear of a U.S. credit default sank the dollar and investors sought assets that could preserve value.
"The U.S. debt ceiling impasse is killing the dollar," said Kathy Lien, director of currency research at GFT Forex in New York. "Until the debt ceiling is increased, the greenback will remain under pressure."

20110727 1111 Local & Global Economic Related News.

Malaysia's exports of rubber products are likely to increase  by about 11% yoy or  RM2bn to RM14.4bn this year due to higher prices and output. Deputy Plantation  Industries and Commodities Minister Datuk G. Palanivel said production for the 1H11 rose  to 480k mt from 450k mt during the same period last year. He said, "It is estimated that by  2020, the export revenue derived from the integrated rubber industry will reach more than  RM98bn.  
  • Demand for natural rubber was estimated to grow at a modest pace this year at 3.8% to  11.149m mt due to anticipation of slower growth of the global economy. Under the  National Key Economic Area (NKEA), it was projected that the Malaysian rubber industry  would contribute RM52.9bn to Gross National Income by 2020 compared to RM20bn in  2010.” (Bernama)      

A review of the current  National Automotive Policy (NAP) by the Government is  expected to be announced by year-end. A source said the new NAP which is expected to be 100 pages long would streamline the NAOP that was reviewed in 2009 to facilitate the  technological advancements and trends of the global automotive industry. (Star Biz)  

Foreign direct investment (FDI) inflows to Malaysia are expected to reach US$10.0bn in  2011, surpassing last year's record of US$9.1bn (US$1.4bn in 2009), said International  Trade and Industry Minister Datuk Seri Mustapa Mohamed.  
  • The recovering global FDI trends, supported by the government's initiatives such as the  Economic Transformation Programme (ETP), would be the key drivers for foreign  investments, he noted.  
  • The World Investment Report 2011 forecasts that global FDI will grow 5.0% this year to  reach the pre-crisis level of US$1.4-1.6tr. The trends are expected to continue and reach  the US$1.9tr mark in 2013, equivalent to the peak of global FDI in 2007. (Bernama)     

The Northern Corridor Implementation Authority (NCIA) expects investments this year  in the Northern Corridor Economic Region (NCER) to exceed last year's RM6.1bn, judging  from the investments of RM3.3bn received, thus far, in the first four months of the year.  (BT)

Home prices in 20 U.S. cities dropped in the year ended May by the most in 18 months,  adding to evidence the housing market is struggling. The S&P/Case-Shiller index of  property values in 20 cities fell 4.5% yoy in May (-4.2% in Apr), the group said. The decline  matched the economists’ forecast. (Bloomberg)  

U.S. consumer confidence unexpectedly rose in Jul from an eight-month low, led by a  rebound in the outlook for jobs over the next six months. The Conference Board’s index  climbed to 59.5 in Jul (57.6 in Jun), figures from the research group showed. Economists  predicted the Jul gauge would fall to 56. (Bloomberg)  

U.S. new home sales  unexpectedly fell for a second month and a gauge of property  values also dropped, showing the industry that sparked the recession is stagnating.  Purchases dropped 1% mom in Jun to a 312,000 annual pace (315,000 in May), a threemonth low, figures from the Commerce Department showed. Economists expected new  home sales climbing to a 320,000 annual rate. (Bloomberg)  

US: Obama administration threatens veto of Boehner debt plan
The Obama administration threatened a presidential veto of House Speaker John Boehner‟s two step plan to raise the US debt ceiling and cut USD3tn in government spending amid new questions about its impact. President Barack Obama‟s Office of Management and Budget said it “strongly opposes” the measure, which the House is set to vote on today, and would recommend a veto if it were passed by Congress. (Bloomberg)

Japan's corporate services price index (CSPI) fell 0.7% yoy in Jun (-0.9% in May), the  Bank of Japan said. Economists expected a reading of -0.8% in Jun. (Reuters, Bloomberg)  

Singapore's  manufacturing output increased 10.5% yoy in Jun (-17.5% in May).  Excluding biomedical manufacturing, output increased 0.6%. The star performer of the  month was the biomedical manufacturing cluster, which grew 38.8% yoy in Jun.  Economists expected a reading of 9.0% in Jun. (CNA, Bloomberg)  

The smallest U.S. hay crop in more than a century is withering  under a record Texas  drought, boosting the  cost of livestock feed for dairy farmers and beef producers from  California to Maryland. The price of alfalfa, the most common hay variety, surged 51% in  the past year, reaching a record US$186 a short ton in May, government data show. Hay  and grass make up about half of what cattle eat over their lifetimes, so parched pastures  are forcing ranchers to find alternative sources of feed, pushing some spot-market corn to  the highest ever. (Bloomberg)  

India’s central bank raised its benchmark interest rate more than forecast to quell the  fastest inflation among major economies. The Reserve Bank of India increased the  repurchase rate to 8% from 7.5%, it said in a statement. No economist predicted the  decision. (Bloomberg)  

India: Signals tougher inflation resolve to avert ‘hard landing’
The Reserve Bank of India signaled it is prepared to accept a slower expansion to pull down an inflation rate that risk causing a crash in the pace of growth in Asia‟s third largest economy if left unchecked. The central bank raised benchmark interest rate by a larger-than-expected 50bps yesterday. (Bloomberg)

China’s  pork prices fell last week for the first time in three months, aiding the  government’s efforts to contain the fastest  inflation in three years. The price of the  Chinese staple dropped 0.2% in the week ended 24 Jul from the previous week  as  supplies increased and demand slowed, the Ministry  of Commerce’s said. That was the  first decline since the week ending 8 Apr. (Bloomberg)  

The  U.K. economy barely grew in 2Q, suggesting the Bank of England will continue to  keep rates at a record low to boost a flagging recovery. Gross domestic product rose 0.2%  qoq in 2Q (+0.5% in 1Q), the Office for National Statistics said. The reading matched  economists’ expectations. (Bloomberg)

20110727 1108 Malaysia Corporate Related News.

KLCI chart reading :
correction range bound little downside biased.

TM sells stake in Axiata
Telekom Malaysia Bhd sold its remaining stake in mobile operator Axiata Group Bhd to  raise about RM468m. Telekom Malaysia sold 92.4m shares in Axiata at RM5.07, which  was a 1.2% to its closing price of RM5.13 Malaysian ringgit on Tuesday. (International  Financing Review)

Petronas : Malaysia's state oil firm  Petronas said on Tuesday that it had signed two separate  agreements to distribute  natural gas extracted from the  Kebabangan cluster located in  the state of Sabah in East Malaysia. The company did not provide an indicative value of  the deal, but said the agreements covered the supply of up to 750m standard cubic feet  per day of gas to both Sabah and Sarawak customers.
  • The first agreement is for the purchase and aggregation of gas from Kebabangan  producers, which includes Petronas Carigali, Shell  Energy Asia Ltd (RDSa.L) and  ConocoPhillips Sabah Gas Ltd. The gas will be sold to customers in Sabah. 
  • The second agreement detailed the supply of gas by  Petronas and the Kebabangan  producers as joint sellers to MLNG Dua Sdn Bhd at the Petronas LNG complex in  Bintulu. MLNG Dua is one of three components that together form the larger Malaysia  LNG Project, which is owned by Petronas, the Sarawak State Government and  Mitsubishi Corporation. (Reuters, Bernama)         

Axis-REIT to acquire RM260m properties
Axis-REIT is planning to acquire RM260m worth of new properties to expand its investment portfolio. The properties for acquisitions include logistics warehouses in Bayan Lepas, Seberang Prai, Shah Alam, Pelabuhan Tanjung Pelepas and Johor which would generate 8.3% to 10.5% yield for the company. Axis-REIT is expected to raise RM170m via placement of 75.2m new units, while the balance of RM90m will come from borrowings to finance the acquisitions. (Financial Daily)

TNB : Tenaga Nasional Bhd is confident of turning in a profit for the financial year ending Aug  31, 2011, despite the RM440.2m net loss posted in the 3Q11. However, the utility giant  would not surpass last year's performance, said President cum Chief Executive Officer,  Datuk Seri Che Khalib Mohd Noh. "We are quite confident of making profit for the whole  year, but to say we will be repeating the result of last year, definitely not," he said.  
  • As for the outlook for 2012, Che Khalib said it would be better than the performance of  the current financial year. However, it is still not expected to repeat the growth seen in  2010, he said. He said the 2% base tariff revision in June 2010 would be the only benefit  that would partially cushion the increase in coal price. (Bernama)         

TNB : The electrical infrastructure for the Port Klang Free Zone (PKFZ) project was supposed to  be built by  Tenaga Nasional Bhd (TNB), the Sessions Court was told. However, the  project developer, Kuala Dimensi Sdn Bhd, suggested taking on the RM135m portion of  the project on a turnkey basis, said the prosecution’s fourth witness, Port Klang Authority  (PKA) engineeering assistant general manager A. Murytharan. (The Star)  

Petronas Chemicals : Petronas Chemicals Group Bhd (PCG) is not ruling out buying assets to strengthen its  olefin and derivatives as well as fertiliser and methanol businesses. "I like to stress that  there are opportunities (for acquisitions), but our plate right now is full. If the opportunities add value to what we are doing, this will be something that we will do," says president Dr  Abd Hapiz Abdullah after the group's AGM yesterday.  
  • He stressed that the group is not in "heavy talks" with any parties.Asked on the type of  assets PCG is looking for, Abd Hapiz said it is looking at those in areas where the  company is quite strong, particularly in the olefin and derivatives as well as fertiliser and  methanol. (BT)      

Alam Maritim gets PCG vessel contract
Alam Maritim has won a Petronas Carigali contract for the provision of an AHTS vessel.  Worth RM10.6m, the contract commenced on 13 July and will run for a primary period of  150 days with two extension options of 45 days each. (BMSB)  

Proton : Proton Holdings Bhd  officially launched the Saga FLX 1.3L yesterday. The car is  available in both manual and six-speed CVT drivetrain options and two variant forms – Standard and Executive. Pricing-wise, the FLX 1.3L starts from RM38,598 for the Standard  manual version right up to RM44,998 for the Executive CVT variant. (ASEAN Automotive  News)  

Uzma secures RM170m Petronas idle well projects
Uzma Bhd’s unit Uzma Engineering Sdn Bhd has won a three-year integrated equipment  and services for idle well reactivation project contract from Petronas Carigali Sdn Bhd. The  value of the contract is estimated at RM170m. (BT)  

Merger of TC Goh’s companies
A merger exercise is on the cards for AIC Corp Bhd, Jotech Holdings Bhd and AutoV  Corp Bhd to create a larger group to gear up for expansion. All three companies have  been suspended from today until Monday pending material announcement expected  Friday.  
  • Sources say the merger exercise will likely be done through a SPV which will acquire  shares in all three companies via a share swap. The SPV will then take over the listing  status of one of the companies. All three companies share a common shareholder in  Datuk Goh Tian Chuan. (Financial Daily)      

Maxis : Sources say OKTel, a reseller partner of Maxis Bhd is transferring its subscriber base to  IME Telco Sdn Bhd, which is affiliated to remittance operator IME Sdn Bhd. IME is owned  by Nepalese giant IME Group. (Financial Daily)  

Details of MRB’s Sg Buloh land deal out before year-end
Details on the actual value and transaction for the Malaysian Rubber Board (MRB) land  in Sungai Buloh is expected to be announced by Prime Minister Datuk Seri Najib Tun  Razak before the year ends. Deputy Minister of Plantation Industries and Commodities  Datuk G. Palanivel said, "Negotiations are still going on between Malaysian Resources  Corp Bhd (MRCB) and Employees Provident Fund (EPF). We cannot disclose the details  at this juncture because we don't have the full details yet.” (Bernama)  

KTMB : Members of the  Railwaymen's Union of Malaya are planning a peaceful picket at the  Keretapi Tanah Melayu (KTM) headquarters compound on Friday to protest the renewal  of contract of KTM President, Dr Aminuddin Adnan for two years from Aug 1. Union  president Abdul Razak Md Hassan claimed that they had obtained approval from Dang  Wangi police to hold the picket from 6pm and that about 1,000 KTM workers are expected  to take part. Speaking at a news conference, Abdul  Razak said the extension of  Aminuddin's contract has created uneasiness with the union, as according to him,  Aminuddin has a negative attitude towards the union. (Bernama)

Public Bank: HP Act impact temporary
Public Bank Bhd, the country's third largest lender, expects a resolution on the amended Hire Purchase Act 1967  to be reached soon between the government and car dealers. "MAA has indicated that May and June car sales  have slowed down a little. We see the slower approval rates for car loans as temporary. We believe it will revert  to previous levels as issues between the car dealers and the government are being sorted out," said managing  director Tan Sri Tay Ah Lek. (Source: Business Times)

Public Bank Q2 profit higher on improved loans and deposits
Public Bank Bhd's net profit jumped 20% to RM880.3mil for the second quarter ended June 30, from  RM734.1mil a year ago, on the back of improved loans and deposits growth and improved asset quality. Its revenue for the quarter was 18.3% higher at RM3.17bil from RM2.68bil a year ago. It reported earnings per  share of 25.14 sen against 20.96 sen previously. The bank also announced a first interim single-tier dividend of  20%, which will result in total payout of RM700mil. (Source: The Star)

Ivory wins Penang land rights
Ivory Properties Group Bhd said that it has won the rights to acquire 41.50 hectares of land in Bayan Mutiara,  Penang, from the Penang Development Corp (PDC). "Approximately 27.34ha are existing land and 14.16ha are  to be reclaimed for a proposed mixed development," Ivory told Bursa Malaysia yesterday. The announcement  confirms a Business Times report on July 12 that Ivory had won the rights to help develop the Bayan Mutiara  land from the PDC. It is learnt that the PDC had set the reserve price for the land at about RM200 per sq ft and  that the cost of developing the land will surpass the RM1 billion mark. (Source: Business Times)

Proton global car by February
Proton Holdings Bhd is slated to introduce its first global car by February 2012, its top executive said.  It is learnt that the car, codenamed P3-21A, is based on the Proton Tuah concept car displayed at the Kuala  Lumpur International Motor Show 2010 in December last year. Proton managing director Datuk Seri Syed Zainal  Abidin Syed Mohamed Tahir said the new model will meet high international standards, specifically European  standards. (Source: Business Times)

Demand for new Myvi remains strong
Demand for the new Perodua Myvi continues to be strong in Malaysia, while Indonesia is showing encouraging  sales. Bookings for the car in Malaysia have topped 21,000, up from 17,000 that was indicated on July  11 by  Perusahaan Otomobil Kedua (Perodua) managing director Datuk Aminar Rashid Salleh. Perodua also exports the  new Myvi to Indonesia, sold under the Sirion brand- name by sister company PT Astra Daihatsu Motor (ADM).  (Source: Business Times)

Sinopec: In a consortium to develop a Petronas’ oil field. China's largest petroleum refiner Sinopec Petroleum Services Corp (Sinopec) is poised to take a major stake in a planned RM2.06b venture to help develop a Petronas' marginal oil field located off the coast of Terengganu. Under the deal, Sinopec will hold a 40% stake in the consortium, while Sabio Oil & Gas Sdn Bhd (SOG), a unit of Sabio Technology Bhd (STB), and Iranian group International Oil and Design and Construction Sdn Bhd (IODC) will each own a 30% stake. (Source: Business Times)

Lion Corp: Defers debt repayment.  Lion Corp lenders have approved the  proposed deferred repayment of a portion of its debt obligations amounting to RM82m from 31 July to 31 December this year. In a statement to Bursa Malaysia, Lion Corp said the deferment involved bonds amounting to RM54.35m, redeemable convertible secured loan stocks worth RM26.97m and US$-denominated debts of US$100,000 (RM297,000). Prior to the latest deferment, Lion Corp had postponed the settlement of its borrowings twice. (Source: The Edge Financial Daily)

20110727 1005 Global Market Related News.

DJIA chart reading :  correction range bound upside biased.

Hang Seng chart reading :
side way range bound little upside biased.

Asian Stocks Fall on U.S. Debt Concern (Source: Bloomberg)
Asian stocks dropped, led by exporters and banks, on concern the global economic recovery will stall as a political stalemate continued over raising the U.S. debt ceiling. Samsung Electronics Co., the South Korean consumer and industrial electronics maker which gets about 85 percent of its revenue abroad, lost 1.3 percent in Seoul. Mitsubishi UFJ Financial Group Inc., Japan’s biggest listed lender, slumped 1.7 percent. Kawasaki Kisen Kaisha Ltd., Japan’s third-largest shipping line by market value, declined 0.4 percent after the Nikkei newspaper reported the company is likely to post a loss as a stronger yen hurts profits. BHP Billiton Ltd. (BHP), Australia’s No. 1 oil producer, fell 1 percent after crude prices declined. The MSCI Asia Pacific Index lost 0.4 percent 138.61 as of 9:26 a.m. in Tokyo. About four stocks fell for each that rose on the gauge.
The measure is on course for a decline this week as U.S. lawmakers struggle to reach an agreement to raise the federal debt limit before an Aug. 2 deadline, increasing concern that the government of the world’s biggest economy may default on its debt.

U.S. June New-Home Sales Fall More Than Estimated to 312,000 Annual Pace (Source: Bloomberg)
Sales of new U.S. homes unexpectedly fell for a second month and a gauge of property values also dropped, showing the industry that sparked the recession is stagnating. Purchases dropped 1 percent in June to a 312,000 annual pace, a three-month low, figures from the Commerce Department showed today in Washington. Prices in 20 cities dropped 4.5 percent in the year ended May, the most since November 2009, according to a report from S&P/Case-Shiller. An expanding pipeline of foreclosures and a lack of demand will probably keep home values depressed this year, discouraging construction and delaying a rebound in housing. Another report showed consumer confidence unexpectedly recuperated in July from an eighth-month low, led by an improvement in the employment outlook for the next six months.

Rating Downgrade for U.S. Is Now ‘Base Case’ Amid Budget Impasse, ISI Says (Source: Bloomberg)
The odds of the U.S. failing to reach a budget deal by Aug. 2 are about 40 percent, and a reduction of the nation’s credit rating “now seems the base case,” according to Andrew Laperriere, a managing director at International Strategy & Investment in Washington. Laperriere said in a note to clients today that there are “strong policy and political incentives” for President Barack Obama and House Speaker John Boehner to reach a deal. “That’s still possible, but a deal that would alter the trajectory” of the ratio of federal debt to gross domestic product “now appears unlikely,” he wrote. Standard & Poor’s placed the U.S. AAA rating on “CreditWatch” July 14, saying there is a 50 percent chance it would be cut in the next 90 days even if an agreement is reached by Aug. 2.

Obama Threatens to Veto Boehner’s Debt Plan (Source: Bloomberg)
A House vote on Speaker John Boehner’s two-step plan to raise the U.S. debt ceiling was postponed amid growing Republican opposition to the measure that the Obama administration has threatened to veto. The plan, which would cut $3 trillion in government spending, was faced with new questions about its impact. House Rules Committee Chairman David Dreier, a California Republican, said he adjourned his panel tonight “to ensure the product we have is in full compliance” with the pledge Boehner has made to cut spending more than the increase in borrowing authority. The latest development cast new doubt on whether lawmakers and Obama could agree on a plan raising the nation’s debt limit before an Aug. 2 deadline when the U.S. could default on some of its obligations. The House vote had been scheduled for tomorrow and was called off late today.

Declining Growth Projections for U.S. Economy Mean Fed May Keep Rates Down (Source: Bloomberg)
Goldman Sachs Group Inc. (GS) is among major banks cutting their forecasts for third-quarter U.S. growth as business inventories swell and consumer confidence declines. Goldman Sachs, JPMorgan Chase & Co. (JPM) and Bank of America- Merrill Lynch said the economy will expand at a 2.5 percent pace, down from earlier projections of as much as 3.25 percent. A more-muted rebound from a slow first half would keep pressure on the Federal Reserve to hold interest rates near zero, according to the banks’ economists. “The soft patch is giving way to a spongy patch,” said Michael Feroli, chief U.S. economist at JPMorgan in New York, who cut his third-quarter forecast from 3 percent on July 14.

Consumer Confidence in U.S. Unexpectedly Increased in July on Jobs Outlook (Source: Bloomberg)
Confidence among U.S. consumers unexpectedly rose in July from an eight-month low, led by a rebound in the outlook for jobs over the next six months. The Conference Board’s index climbed to 59.5 from a revised 57.6 reading in June that was lower than previously estimated, figures from the New York-based private research group showed today. Economists predicted the July gauge would fall to 56, according to the median forecast in a Bloomberg News survey. Easing fuel prices may make households more comfortable opening their wallets in the second half of the year. At the same time, Federal Reserve Chairman Ben S. Bernanke told Congress earlier this month that unemployment above 9 percent and falling home values are a concern for Americans, which may restrain any recovery in consumer spending.

Home Prices in 20 U.S. Cities Fell 4.5% in Year (Source: Bloomberg)
Home prices in 20 U.S. cities dropped in the year ended May by the most in 18 months, adding to evidence the housing market is struggling. The S&P/Case-Shiller index of property values in 20 cities fell 4.5 percent from May 2010, the group said today in New York. The decline matched the median forecast of 32 economists surveyed by Bloomberg News. A pipeline of foreclosures and uneven demand will keep prices from rising this year, discouraging new-home construction and delaying a rebound in housing. Shrinking home equity and an unemployment rate at 9.2 percent are weighing on consumer spending, which accounts for about 70 percent of the economy.

U.S. Stocks Decline Amid Debt Concerns, Disappointing Forecast From 3M (Source: Bloomberg)
U.S. stocks fell for a second day amid wrangling between lawmakers over plans to raise the federal debt limit and forecasts from 3M Co. (MMM) and United Parcel Service Inc. (UPS) that disappointed investors. 3M lost 5.4 percent, the most in the Dow Jones Industrial Average, after projecting full-year earnings that trailed analysts’ estimates. UPS, the world’s largest package-delivery company, dropped 3.3 percent after saying the third quarter will be “fairly slow.” AK Steel Holding Corp. (AKS) tumbled 17 percent, the most since 2008, as the steelmaker’s profit missed the average analyst estimate. Lexmark International Inc. (LXK) rose 18 percent after reporting better-than-estimated earnings. The S&P 500, which rallied 2.2 percent last week, dropped 0.4 percent to 1,331.94 at 4 p.m. in New York. The Dow lost 91.50 points, or 0.7 percent, to 12,501.30.

US lawmakers deadlock over debt as default looms
WASHINGTON, July 26 (Reuters) - The United States edged closer on Tuesday to a devastating default as Republicans and Democrats deadlocked over competing plans to raise the debt ceiling, one week before a deadline to act.
President Barack Obama, in a televised address aimed at rallying public support for a package proposed by Democrats, warned that failure to increase the U.S. borrowing limit would severely hurt the nation.

U.S. debt stalemate hits dollar; no stocks panic
LONDON, July 26 (Reuters) - The dollar fell across the board as a speech by U.S. President Barack Obama gave no sign of a swift breakthrough in deadlocked talks to raise the U.S. debt ceiling, while a run of strong earning reports supported world stocks.
"Equity traders clearly remain concerned over the lack of a debt deal out of the U.S., but it's looking increasingly academic after rival sides tabled competing proposals and President Obama urged them to find a compromise," said Chris Weston, trader at IG Markets.

Dollar Close to Record Low Against Franc Before House Vote on Debt Ceiling (Source: Bloomberg)
The dollar was 0.2 percent from a record low against the Swiss franc before the U.S. House votes on a plan to cut government spending in exchange for lifting the so-called debt ceiling. The greenback was within 0.4 percent of its weakest level against New Zealand’s dollar as a U.S. report is forecast to show demand for durable goods grew at a slower pace in June. The yen reached a four-month high versus the dollar amid speculation Japan’s authorities will sell the nation’s currency to prevent its strength from derailing an export-led recovery. Australia’s currency was within 0.5 percent of a record high against the dollar ahead of a report today on the nation’s inflation. “The weaker dollar direction is a more powerful influence than strong gains in growth-oriented currencies,” said Greg Gibbs, a foreign-exchange strategist in Sydney at Royal Bank of Scotland Group Plc. “The market is certainly factoring in higher risk of a downgrade” of the U.S.’s credit rating.

Treasuries Decline as Obama Threatens to Veto House Speaker’s Debt Plan (Source: Bloomberg)
Treasuries fell, eroding a gain from yesterday, as President Barack Obama threatened to veto House Speaker John Boehner’s plan to raise the U.S. debt ceiling and cut $3 trillion in spending. The U.S. government’s credit rating will probably be lowered because politicians are unlikely to agree on a plan to cut spending, according to Kathleen Gaffney, co-manager of the $21 billion Loomis Sayles Bond Fund. The Treasury is scheduled to sell $35 billion of five-year debt today, the second of three note auctions this week. “There’s a concern, not only for a downgrade, but also for a default,” said Hideo Shimomura, who helps oversee the equivalent of $77 billion in Tokyo as chief fund investor at Mitsubishi UFJ Asset Management Co., a unit of Japan’s biggest bank. “If there’s no accord, yields are going to rise.”

Apple Tops $400, Chases Exxon as Most Valuable (Source: Bloomberg)
Apple Inc., a week after reporting record sales and profit, surpassed $400 a share for the first time and is gaining ground on Exxon Mobil Corp. to become the world’s most valuable company.

Japanese Stocks Decline as U.S., European Debt Concern, Yen Hits Exporters (Source: Bloomberg)
The Nikkei 225 (NKY) Stock Average fell for the third time in seven days as wrangling between U.S. lawmakers over plans to raise the federal debt limit and falling demand for European debt increased concern the global recovery may stall. Sony Corp., a consumer electronics exporter that earns about a half of its revenue from the U.S. and Europe, lost 0.7 percent. Nissan Motor Co., a carmaker that gets about 80 percent of its revenue overseas, sank 1.2 percent after the dollar weakened against the yen, cutting the earnings outlook for the exporter. Hino Motors Ltd., a maker of trucks and busses, slid 1.6 percent after posting a first-quarter loss on earthquake- related charges and lower sales. The Nikkei 225 Stock Average fell 0.6 percent to 10,041.70 as of 9:03 a.m. in Tokyo. The broader Topix lost 0.7 percent to 859.82, with about five shares dropping for each that gained.

South Korea’s Economy Grows at Slower Pace (Source: Bloomberg)
South Korea’s economy expanded at a slower pace in the second quarter as a stronger won and Europe’s fiscal crisis weighed on exports. Gross domestic product rose 0.8 percent from the previous quarter, when it advanced 1.3 percent, the Bank of Korea said in Seoul today. That matched the median estimate of 10 economists in a Bloomberg News survey. The economy grew 3.4 percent from a year earlier, slower than estimates of a 3.5 percent expansion. Heightened global uncertainty driven by fiscal woes in the U.S. and Europe hasn’t deterred South Korean policy makers from fighting inflation. Bank of Korea Deputy Governor Kim Jae Chun said on July 25 that price gains remain the central bank’s biggest concern and that the economy will rebound in the second half of the year.

India Signals Tougher Inflation Resolve to Avert ‘Hard Landing’ of Economy (Source: Bloomberg)
The Reserve Bank of India signaled it’s prepared to accept a slower expansion to pull down an inflation rate that risks causing a crash in the pace of growth in Asia’s third-largest economy if left unchecked. The RBI yesterday surprised all 22 economists surveyed by Bloomberg News with a half-point boost in the repurchase rate to 8 percent. The bank said in a statement that stronger action was needed in the absence of government steps to damp demand or efforts to address the nation’s supply bottlenecks. Governor Duvvuri Subbarao was forced to escalate what was already the steepest increase in borrowing costs among major Asian economies, after household expectations for inflation exceeded 12 percent, above the 9.44 percent current pace. The bank will add another half point to the benchmark rate by the end of 2011, the median of 11 estimates in a Bloomberg survey yesterday showed.

India Raises Interest Rates More Than Estimates, Spurring Slide in Stocks (Source: Bloomberg)
India’s central bank raised its benchmark interest rate more than forecast to quell the fastest inflation among major economies, spurring a slide in stocks and gain in the rupee. The Reserve Bank of India increased the repurchase rate to 8 percent from 7.5 percent, it said in a statement in Mumbai today. None of the 22 economists surveyed by Bloomberg News predicted today’s decision. Twenty estimated a quarter-point rise, while the remainder expected no change. Governor Duvvuri Subbarao acted as the central bank elevated its inflation forecast for the year through March by 1 percentage point, to 7 percent. With rising rural wages and a lack of corporate investment growth straining capacity, India’s price pressures mean it lacks the leeway in setting monetary policy afforded to counterparts in South Korea, Malaysia and Indonesia, which kept borrowing costs unchanged this month.

India central bank surprises with 50 bps rate rise
MUMBAI, July 26 (Reuters) - India's central bank stunned investors by raising interest rates by 50 basis points on Tuesday, showing unexpected resolve in fighting persistently high inflation despite slowing growth in Asia's third-largest economy and uncertainty about global demand.
The Reserve Bank of India (RBI) increased the repo rate  at which it lends to banks to 8 percent, topping forecasts that it would raise rates by 25 basis points.

U.K. Growth Slows, Reinforcing Low-Rates Case (Source: Bloomberg)
The U.K. economy barely grew in the second quarter, suggesting the Bank of England will continue to keep rates at a record low to boost a flagging recovery. Gross domestic product rose 0.2 percent from the first quarter, when it increased 0.5 percent, the Office for National Statistics said today. That matched the median forecast of 32 economists in a Bloomberg News survey. Manufacturing output fell 0.3 percent. Excluding factors such as the impact on production from the Japanese earthquake and the extra public holiday for the royal wedding, the economy could have grown as much as 0.7 percent, the statistics office estimates. The pound jumped against the dollar after the report. Prime Minister David Cameron yesterday said Britain is facing a “difficult” recovery as budget cuts bite. Consumers are spending less as the fiscal squeeze undermines confidence and inflation erodes incomes at the fastest pace since the 1970s.
Bank of England officials said this month the economic weakness may persist “for longer than previously thought.”

U.K. Economy Probably Barely Grew in 3 Months (Source: Bloomberg)
The U.K. economy probably barely grew in the second quarter, supporting the arguments of a majority of Bank of England policy makers that interest rates should be kept at a record low. Gross domestic product climbed 0.2 percent from the first quarter, when it increased 0.5 percent, according to the median of 32 forecasts in a Bloomberg News survey. The Office for National Statistics will publish the data at 9:30 a.m. today in London. Bank of England officials said this month that the weakness in the economy may persist “for longer than previously thought” as they kept the benchmark interest rate at 0.5 percent. While the effects of the earthquake in Japan and U.K. public holidays in April and May probably disrupted supply in the second quarter, consumers are spending less as the government’s fiscal squeeze undermines confidence and inflation erodes incomes at the fastest pace since the 1970s.

IMF Chief Lagarde Sees ‘Level of Uncertainty’ in Reaction to Greek Rescue (Source: Bloomberg)
International Monetary Fund Managing Director Christine Lagarde said today that she sees a “level of uncertainty” in the market reaction to the rescue plan for Greece. She was speaking at the Council on Foreign Relations in New York.

European Stocks Drop for Second Day; BP, UBS Fall After Earnings Reports (Source: Bloomberg)
European stocks retreated for a second day as companies from BP Plc (BP/) to UBS AG reported earnings that missed analysts’ estimates and concern grew that U.S. lawmakers may fail to increase the nation’s debt limit. BP, Europe’s second-biggest oil company, and UBS, Switzerland’s largest bank, slid more than 2.5 percent. STMicroelectronics NV (STM), Europe’s biggest semiconductor maker, sank the most in almost 10 years after saying there will be a “correction” in sales. The benchmark Stoxx Europe 600 Index slid 0.4 percent to 270.08 at the 4:30 p.m. close in London. The gauge has retreated 7.2 percent from this year’s high in February amid concern that Europe’s fiscal crisis will derail the economic recovery and speculation that U.S. lawmakers will fail to agree on increasing the nation’s debt ceiling by next week’s deadline.

U.K. Stocks Slide; BP Falls as Profit Misses Estimates, BG Group Advances (Source: Bloomberg)
Most U.K. stocks retreated as BP Plc (BP/) reported earnings that missed analysts’ estimates and concern mounted that U.S. lawmakers will fail to increase the federal debt limit. BP, Europe’s second-largest oil company, dropped 2.6 percent, the most in three months. BG Group Plc (BG/), the U.K.’s third-biggest natural gas producer, surged 4.3 percent after saying that profit doubled in the second quarter. The benchmark FTSE 100 Index (UKX) gained 4.47, or less than 0.1 percent, to 5,929.73 at the 4:30 p.m. close in London as two stocks fell for each that advanced. The gauge has still dropped 2.7 percent since this year’s high on Feb. 8 as investors speculated that Europe’s sovereign-debt crisis will spread. The broader FTSE All-Share Index also rose less than 0.1 percent today, while Ireland’s ISEQ Index retreated 0.6 percent.

FOREX-Debt jitters slam dollar, Swiss franc rallies
LONDON, July 26 (Reuters) - The dollar plumbed a record low against the Swiss franc and suffered broadly on Tuesday as ongoing political wrangling about raising the U.S. debt ceiling kept investors jittery about the possibility of a debt default, which could trigger more losses in the U.S. currency.
The greenback fell as low as 0.7997 francs  as options-related barriers were taken out at the psychologically key 0.8000 level, and traders said the dollar could fall "another 2-3 big figures" if U.S. lawmakers are unable to agree on raising the debt ceiling by an Aug. 2 deadline.

20110727 1003 Global Commodities Related News.

Corn (Source: CME)
US corn futures finished stronger on concerns declining condition ratings indicate the USDA will cut its output forecast. Government has lowered its good-to-excellent rating for the corn crop by seven percentage points in the past two weeks. That leads market participants to "believe the yield numbers have nowhere to go but down," says Tim Hannagan, analyst for PFG Best. The good-excellent rating is down 10 percentage points from last year but USDA sees the yield rising almost six bushels/acre from last year. CBOT December corn jumps 12 1/4c to $6.86 3/4 a bushel.

Wheat (Source: CME)
US wheat futures closed higher on spillover support from rising corn and soybean prices. Gains in the other markets lift wheat because the grains are all used for livestock feed. Yet, demand news wasn't supportive for wheat. Egypt, often the world's top wheat importer, booked Russian wheat in a tender and none from the US. Competition for business has increased since Russia resumed grain exports this month. CBOT September wheat rises 5 1/2c to $6.94 a bushel; KCBT September gains 10c to $7.80 1/2; MGE September advances 8 1/4c to $8.39.

Rice (Source: CME)
US rice futures finished higher on spillover support from gains in grain and soybean markets. Additional support comes from ongoing concerns the US crop will fall short of expectations due to poor weather and reduced plantings. The USDA raised its weekly good-excellent rating for the crop by three percentage points to 63%, but that is down 10 percentage points from a year ago. CBOT September rice closes up 5 1/2c at $17.21/hundredweight.

Food inflation in focus amid lofty crop price outlook
CHICAGO, July 25 (Reuters) - Grain prices will likely remain elevated at the end of this year, a Reuters poll showed, providing little relief to food prices while continuing to challenge policymakers battling to tamp down inflation.
Many analysts say the era of cheap food may well be over as rising crop production struggles to keep pace with soaring global demand, particularly from the mushrooming middle-class populations of developing nations such as China and India.

Corn, soy ratings seen down for second week
CHICAGO, July 25 (Reuters) - The condition of U.S. corn and soybean crops declined as the plants withered in the heat last week, particularly in southern and western growing areas, analysts said.
The health of corn and soybean crops deteriorated a week ago and the downtrend was seen continuing as a heatwave settled over much of the country.

US spring wheat tour changes tack to count yields
CHICAGO, July 22 (Reuters) - The annual spring wheat tour that kicks off next week will be different from past years.
With the crop planted late due to rains and floods, volunteer scouts from the grain industry on the expedition this year will have to alter the way they calculate yields.

US Midwest Heatwave Stresses Corn, Beans (Source: CME)
U.S. corn and soybean crops deteriorated last week due to extreme heat and dryness, the U.S. Department of Agriculture confirmed Monday. The USDA, in a weekly crop-progress report, cut its good-to-excellent rating by four percentage points, to 62%, for corn and by two percentage points, to 62%, for soybeans. Both declines were at the high end of what traders expected. "Soaring temperatures and limited precipitation stressed crops and livestock last week," the USDA's Indiana office said in a report. Grain traders are keeping a close eye on the weather and condition ratings because farmers need to harvest a large crop to replenish low inventories. Prior to last week's heat wave, crops had already struggled with persistent rains and flooding that delayed planting. The good-to-excellent rating for Indiana's corn crop dropped seven percentage points, to 46%, and six percentage points for the soybean crop, to 47%, according to the USDA.
The good-to-excellent rating for corn also dropped seven percentage points in Ohio, with the government pegging it at 48% as of Sunday. The ratings could recover if weather conditions improve this week, said Steve Georgy, broker and analyst at Allendale, a brokerage in Illinois. Temperatures are expected to moderate and rain is possible this weekend after heavier-than-expected showers brought relief to the Midwest during the past weekend. "If we don't see these 90- and 100-degree temperatures, I think we could see crop improvement," Georgy said. Late planting has left crops in some areas more susceptible to damage from extreme heat because they didn't have time to develop extensive root systems to access moisture deep in the ground. The USDA noted that Indiana farms suffered because "storms that carried rainfall also knocked down corn in some areas, with shallow-rooted corn especially vulnerable."
Development of the crops is behind schedule due to the late planting, as well. The corn crop was 65% in the silking stage of development as of Sunday, behind the five-year average of 69% for this time of year, and 9% in the dough stage of development, behind the average of 12%, according to the USDA. The soybean crop was 60% in the blooming stage of development, behind the average of 68%, and 16% of the crop was setting pods, behind the average of 27%. As for cotton, a severe drought in the southern U.S. continues to hurt the crop. The USDA increased its good-to-excellent rating for cotton by one percentage point from last week, to 29%, but raised its poor-to-very-poor rating by one percentage point, to 41%. Land used for pasture also continue to struggle. The USDA rated 44% of pasture and range land as good to excellent as of Sunday, down from 46% a week earlier. In the northern Plains, the USDA increased the good-to-excellent rating for the spring wheat crop one percentage point from last week, to 74%.
A year ago, 83% of the crop was rated good to excellent.

U.S. corn up as dlr falls, focus turns to yields
SYDNEY, July 26 (Reuters) - U.S. corn firmed, recouping some of the previous day's losses on a fall in the U.S. dollar and as traders assessed the yield impact of the recent U.S. heat wave and subsequent cool down.
"Much of the focus is on yields as there will be a few private forecasts out next week and there is a pretty wide range of forecasts on corn yields as well as beans," said Brett Cooper, senior manager, markets, for FCStone Australia.

Indonesia sees longer dry season lasting to Nov
JAKARTA, July 26 (Reuters) - Indonesia's state weather agency on Tuesday forecast the country's dry season will last longer than normal until November, a boon for coal miners but potentially hurting rice output.
A prolonged wet season last year hurt crops such as coffee and flooded mines. A longer dry season this year will favour miners, but experts said it could hit efforts to boost rice supply, underlying recent government moves to import the staple.

Japan Importers Start Corn Purchases For 4Q (Source: CME)
Japan has started purchasing corn for October-December shipment, buying at least 300,000 metric tons in the last few days, trading executives said. Japan is the world's largest corn importer and buys around 3.2 million tons of feed-grade corn each quarter. All purchases so far are from the U.S., an executive with a Tokyo-based commodities trading company said. Traders said purchases would have been higher but for the rise in prices earlier this month. They said compound feed manufacturers bought corn for October shipment, basis cost and freight, around 230 cents over the December futures contract on the Chicago Board of Trade. Japan bough November and December corn around 220 cents over the December contract. As the CBOT December corn futures contract is around $6.78 a bushel, the purchases are close to $353-$359/ton, C&F. Japanese importers purchase corn on premium basis over CBOT and lock in the final price at any day of their choice.
"Prices are still quite high, though they have eased from levels well above $400/ton reached last month," a Japanese importer said. He said many importers are still going slow on final pricing due to concerns over high costs. Most traders said almost half of the corn purchases for September shipment have yet to be priced. They said Japanese buyers aren't importing South American corn as it is at least 5% costlier than U.S. corn.

W.Australia wheat output to double, spreads narrow
MELBOURNE, July 26 (Reuters) - Wheat output in Western Australia, which produces high-quality milling grain, is likely to double to around 9 million tonnes this year following ideal crop weather, boosting prospects of wheat exports from the country in the coming marketing season.
This has narrowed the spread between the nation's west and east coast wheat to A$13 a tonne, down from A$28 last month and A$45 last year when a severe drought hit the region, traders told Reuters at a grains industry conference in Melbourne.

New demand for Vietnamese rice lifts prices -paper
HANOI, July 26 (Reuters) - Vietnam, the world's second-largest rice exporter after Thailand, is expected to sign deals for a combined 350,000 tonnes of the grain with Malaysia and East Timor between now and the end of the year, a state-run newspaper reported on Tuesday.
New demand has emerged from Chinese buyers and Philippine private firms which have come to Vietnam to seek rice, the Vietnam Economic Times newspaper said, lifting prices this week.

Thai mill buys Russian milling wheat in year's 1st deal
MELBOURNE, July 26 (Reuters) - A Thai flour mill has bought Russian wheat at $290 per tonne, including cost and freight, for shipment in August in one of this year's first reported deals for milling wheat since the country resumed exports.
More deals are likely as buyers eye cheaper cargoes from the Black Sea region, which is making aggressive offers, grains traders said on the sidelines of an industry meet in Melbourne.

Russia to keep agricultural subsidies after WTO entry
MICHURINSK, Russia, July 25 (Reuters) - President Dmitry Medvedev said on Monday that Russia will not withdraw state subsidies for farmers if it joins the WTO, which Moscow hopes for later this year after 18 years of accession talks.
Russia is the biggest economy outside the World Trade Organisation and Medvedev's comments underlined its robust stand on free trade rules.

Polish 2011 grain harvest seen down 1-5 pct-stats
WARSAW, Jul 26 (Reuters) - Poland's grain harvest is expected to fall by 1-5 percent this year to 24.3-25.2 million tonnes due to poor weather conditions in autumn and spring, stats office GUS said on Tuesday.
Intensive rains in autumn of last year delayed sowings and alternating periods of drought and rains in spring and summer 2011 also took their toll, the office said.

Thailand may release some of 2 mln tonnes rice stocks
BANGKOK, July 26 (Reuters) - The Thai state may release some of its rice stocks into the domestic market if it sees any shortage, a government official said on Tuesday, after speculators were reported to be hoarding grain, expecting prices to rise under an incoming government.
"We have around 2 million tonnes of milled rice in stocks, ready to be sold at any time if there is any tightness in the domestic market. However, we don't see any shortage at this moment," said Anukul Tamprasit, president of the Public Warehouse Organisation (PWO).

Indian Monsoon Seen Near Normal (Source: CME)
Monsoon rain in India this year is likely to be close to normal, and there is no change in the rainfall forecast of 95% of the 50-year average, the country's weather chief said, giving some cheer policymakers who are battling high inflation. "The distribution of rains is very good, and it is one of the best [monsoons] in recent years," Ajit Tyagi told reporters on the sidelines of a conference. He said that the monsoon rain is lagging only in the states of Gujarat, Haryana, Assam and some parts of Andhra Pradesh. Gujarat is the country's largest cotton and groundnut producer, while Assam is a key tea-growing region. Andhra Pradesh is one of India's leading rice producers.

Sugar edges higher on Brazil crop prospects
LONDON, July 26 (Reuters) - Sugar futures edged higher, underpinned by uncertainty over top producer Brazil's crop size, while coffee futures consolidated, as concern of a potential U.S. debt default weighed on investor sentiment. ICE Cocoa was steady, supported by the weaker dollar.
India is not in a hurry to allow additional sugar exports, Food Minister K.V. Thomas said on Tuesday, responding to a demand made by an industry body to allow half a million tonnes more for overseas sales to cash in on high global prices.

India to consider sugar exports after Sept
NEW DELHI, July 26 (Reuters) - India is not in a hurry to allow additional sugar exports, Food Minister K.V. Thomas said on Tuesday, responding to a demand made by an industry body to allow half a million tonnes more  for overseas sales to cash in on high global prices.
On Monday, a leading industry body had sought permission from the government for an extra 500,000 tonnes of sugar exports in the current year.

Indian sugar body seeks govt nod for extra exports
NEW DELHI, July 25 (Reuters) - A top industry body in India has sought the government's nod for an additional 500,000 tonnes of sugar exports in the year to September, a demand if met could help ease global prices that are creeping up on supply worries from top exporter Brazil.
"We have written to the food ministry for permission of additional sugar exports as we've got surplus stocks and global prices are good," said Vinay Kumar, managing director of the National Federation of Cooperative Sugar Factories, a producers' body of 250 mills.

Illegal mining blamed for floods in Ghana cocoa region
ACCRA, July 25 (Reuters) - Ghana President John Atta Mills pledged on Monday to fight illegal mining which has been blamed for floods that swept the  West African nation's cocoa growing Eastern region last week, killing at least five people.
More than 100,000 people were also displaced by the floodwater which destroyed houses, roads and farms, emergency officials said on Monday.

Oil Falls in New York After Industry Report Shows U.S. Stockpile Increase (Source: Bloomberg)
Oil fell in New York as investors bet that rising U.S. crude stockpiles indicated fuel demand may falter in the world’s biggest consumer of the commodity. Futures slipped as much as 0.5 percent today after the industry-funded American Petroleum Institute said inventories climbed 3.96 million barrels to 358.2 million last week. An Energy Department report today may show supplies slipped 2 million barrels, according to a Bloomberg News survey of analysts. It would be the eighth week of declines. “Oil prices weakened after the regular trading session in the wake of this week’s API report,” Peter Beutel, president of Cameron Hanover Inc., an energy adviser in New Canaan, Connecticut, said in an e-mailed note today. Crude stockpiles “showed an unexpected build,” he said.

Trader to pay $1 mln in metals futures case-US CFTC
WASHINGTON, July 25 (Reuters) - A former portfolio manager for Moore Capital Management agreed on Monday to pay the U.S. futures regulator $1 million to settle charges that he attempted to manipulate prices of palladium and platinum futures contracts on the New York Mercantile Exchange.
Christopher Louis Pia attempted to manipulate the settlement prices of palladium and platinum futures contracts from at least November 2007 until May 2008 while working for Moore Capital, the Commodity Futures Trading Commission said.

Kenya titanium cargoes to start 2013-Base Resources
NAIROBI, July 25 (Reuters) - Australia's Base Resources Ltd  said on Monday it expected the first shipment of products from its Kenyan titanium mining project by mid-2013.
The project near the east Africa nation's port city of Mombasa is scheduled to begin in September after lengthy delays due to demonstrations by environmental groups, disputes with farmers over land compensation and talks with the government.

Sinosteel Zimasco sees 2012 ferrochrome output up 27 pct
HARARE, July 25 (Reuters) - Sinosteel Corp's Zimbabwean unit will increase its ferrochrome output by more than a quarter by 2012 following the repair and upgrade of one of its six furnaces, an official said on Monday.
Sinosteel, which owns 73 percent of Zimbabwe Mining and Smelting, or Zimasco, has announced plans to invest $300 million into the firm to build a new smelter and ramp up production in Zimbabwe's largest ferrochrome producer.

Great Western, China firm to build rare earth plant
TORONTO, July 25 (Reuters) - Great Western Minerals  is teaming up with a Chinese rare earth producer to build a rare earth processing plant in South Africa, the company said on Monday.
The separation plant, a joint venture with Ganzhou Qiandong Rare Earth Group Ltd, will be built close to Great Western's Steenkampskraal mine in Western Cape province.

Unwrought aluminium stocks 1.474 mln T in Jun - IAI
LONDON, Jul 26 (Reuters) - Western world unwrought aluminium stocks dropped to 1.474 million tonnes in June compared with a revised 1.573 million in May, industry data showed on Tuesday.
Unwrought stocks stood at 1.190 million tonnes in June 2010, provisional data from International Aluminium Institute (IAI) figures showed.

U.S. Steel profit, revenue miss Street
NEW YORK, July 25 (Reuters) - U.S. Steel Corp  posted lower-than-expected quarterly profit and revenue on Monday, although the company did rebound from three consecutive quarterly losses, helped in part by higher selling prices and stable supply costs.
John Surma, U.S. Steel's chief executive officer, warned that United States and Europe "continue to face an uneven economic recovery."

China aims to diversify iron ore import sources
SHANGHAI, July 26 (Reuters) - China aims to boost iron ore imports from its own overseas mines in the next decade and slash supplies from dominant supplier countries, Australia, India and Brazil and the three biggest mining firms, Brazil's Vale  and Australia's Rio Tinto  and BHP Billiton .  
The deputy secretary general of the China Iron and Steel Association, Li Xinchuang, told China Daily on Tuesday that currently, only 10 percent of China's imports are sourced from Chinese-owned overseas mines.

Japan rolled copper output down on weak auto, chip demand
TOKYO, July 26 (Reuters) - Japan's output of rolled copper product fell 3.2 percent in June from May as strong demand from air-conditioner makers failed to offset weak demand in the auto and chip sectors, preliminary data showed on Tuesday.
The Japan Copper and Brass Association said rolled copper output totalled 70,019 tonnes in June on a seasonally adjusted basis, down 4.2 percent from a year earlier.

Copper concentrate supply to China seen up on Oyu Tolgoi
HONG KONG, July 26 (Reuters) - Chinese smelters expect supplies of copper concentrate to rise as early as late 2012, paving the way for higher charges, as neighbouring Mongolia's Oyu Tolgoi copper and gold mine starts to come onstream, industry sources said on Tuesday.
That may prompt Chinese smelters to raise term treatment and refining charges (TC/RCs) requirements for 2012 after they won a more than 50 percent on-year increase to $72 a tonne and 7.2 U.S. cents a pound for the first half of 2011 and $90 and 9 cents for the second half.

Copper Gains as Strike Enters Fifth Day at Escondida, World’s Biggest Mine (Source: Bloomberg)
Copper rose the most in more than two weeks on speculation that a strike at the world’s biggest mine may worsen a global supply shortage. A strike at BHP Billiton Ltd.’s Escondida mine entered a fifth day as Chilean labor authorities prepared to mediate talks between union and company officials. The stoppage has cost about 12,000 metric tons in lost output, said Roberto Arriagada, a union director. World consumption is set to exceed production by 377,000 tons this year, the International Copper Study Group has forecast. The strike “just adds to people’s preconceived idea that there is a tightness in supply,” Jaspar Crawley, a broker at Triland Metals Ltd., one of the 12 companies on the floor of the London Metal Exchange, said today in a telephone interview.

Xstrata copper output climbs in Q2, coal sees recovery
LONDON, July 26 (Reuters) - Miner Xstrata  posted a 6 percent increase in copper output during the second quarter, broadly in line with forecasts, as volumes in Chile and Australia helped offset the impact of a weather-battered start to the year.
Xstrata, the fourth-largest global diversified miner, had reported a drop in copper output in the first quarter, when it was hit by severe weather conditions at its Collahuasi mine in Chile and across the southern hemisphere. But it said on Tuesday that mined copper production in the first half totalled 434,046 tonnes, broadly in line with a year ago.

METALS-Copper hits 1-week high on weak dollar, fund buys
LONDON, July 26 (Reuters) - Copper rallied to its highest in a week on Tuesday, lifted by a sagging dollar, fund buying and a strike at the world's biggest copper mine, which focused investors on supply.  
LME copper  rose 1.4 percent to $9,789.25 at 0945 GMT, up from a close of $9,655 a tonne on Monday.
The metal used in power and construction last week rallied to $9,873.50, its highest since mid-April.

PRECIOUS-Gold eases but support from U.S. debt talks firmkeeps investors jittery
LONDON, July 26 (Reuters) - Gold eased on Tuesday as investors cashed in some gains after the previous session's record high, but the political impasse in the United States over raising the debt ceiling kept prices firmly supported above $1,600 an ounce.
Spot gold  edged down 0.3 percent to $1,609.79 by 0939 GMT. It hit a record $1,622.49 on Monday as U.S. President Barack Obama warned that failure to reach an agreement to avert default could cause a deep economic crisis and urged Republican and Democratic leaders to reach a compromise.

Gold Surges Toward Record as ‘Go-to Asset’ (Source: Bloomberg)
Gold approached an all-time high as investors sought to protect their wealth against the possibility of a U.S. default that may come as soon as next week amid a standoff over the country’s $14.3 trillion debt limit. Spot bullion gained as much as 0.3 percent to $1,623.38 an ounce, compared to the record $1,624.07 reached on July 25, and traded at $1,622.65 at 9:18 a.m. in Singapore. Futures climbed as much as 0.4 percent to $1,625.60 in New York. The House of Representatives is set to vote July 28 on a two-step plan backed by Speaker John Boehner that would raise the ceiling before an Aug. 2 deadline while paring the deficit, with the lawmakers’ planned voting delayed by a day. President Barack Obama has threatened a veto. The impasse sent the dollar to a record low against the Swiss Franc yesterday, while pushing the cost of insuring U.S. debt to a 17-month high.

Can Goldman, Morgan Stanley recover commodities moxie?
NEW YORK, July 25 (Reuters) - At the once-feared commodity trading arms of Goldman Sachs  and Morgan Stanley , the pressure to do better in the second half of this year has never been more intense.
Long admired for their scale, savvy and unrivalled expertise that lifted them leagues above rivals, the two investment banking titans on Wall Street reported last week a significant drop in commodity revenue in the second quarter.

20110727 1002 Soy Oil & Palm Oil Related News.

Soybeans (Source: CME)
US soybean futures ended higher, retracing previous declines amid disappointing crop condition ratings and support from a weaker US dollar. The threat of poor crop conditions ahead of soybeans critical pod filling stage of development encouraged traders to add risk premium back to prices, analysts said. The uncertainty of the US and global economy in conjunction with the drop in the dollar, making US inventories competitive with Brazilian supplies added support to prices, analysts added. CBOT Nov soy climbed 1.2% to $13.88 3/4/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures closed higher, rallying in unison with soybean futures. The threat of smaller soybean crops, based on falling crop ratings, buoyed soymeal and soyoil, with talk of the potential for increased export demand in world markets aiding the advances in both products, analysts said. CBOT Dec soymeal end up 1.7% at $369.30/short ton; Dec soyoil was up 0.9% at 57.47c/pound.

Palm futures up as output seen slowing; US debt eyed
KUALA LUMPUR, July 26 (Reuters) - Malaysian palm oil futures bounced back in light trade as investors bet on talks of slower production due to drier weather in major planting areas, although uncertainty about the global economy still weighed.  
"Weather is still in play, any significant movement in grains futures and the global market is going to impact Malaysia palm oil," said a trader with foreign brokerage in Kuala Lumpur.