Friday, November 11, 2011

20111111 1812 FCPO EOD Daily Chart Study.

FCPO closed : 3135, changed : +16 points, volume : higher.
Bollinger band reading : upside biased with possible pullback correction.
MACD Histrogram : rising, buyer in control.
Support : 3100, 3070, 3050, 3020 level.
Resistance : 3150, 3200, 3250, 3270 level.
Comment :
FCPO closed recorded gain with improving volume participation while overnight soy oil continue to closed recorded loss and currently rebounding higher while crude oil price rising higher.
Market seems still upbeat on yesterday unexpected lower stock and better export MPOB data released while soybean and soy oil trade lower due to larger South America crop and lower October China soybean imports that reach 7 month low.
Daily chart formed an up doji bar candle with upper and lower shadow closed above upper Bollinger band level after market opened and dipped lower tested support level and move side ways followed by after lunch session rise tested higher resistance level and eased little lower the closed off the high of the day.
Chart study remained suggesting an upside biased market development with possible pullback correction(profit taking).
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.

20111111 1725 FKLI EOD Daily Chart Study.

FKLI closed : 1459, changed : -9.5 points, volume : lower.
Bollinger band reading : pullback correction little upside biased.
MACD Histrogram : falling, buyer closing position.
Support : 1458, 1445, 1440, 1435 level.
Resistance : 1470, 1477, 1485, 1491 level.
Comment :
FKLI closed recorded loss for the 3rd day with slower transacted doing 9.5 points discount compare to cash market that closed little lower. Overnight U.S. markets rebounded higher recorded gains and today Asia markets traded mostly higher while European markets currently trading higher.
Lower U.S. jobless claims and no further bad news from European zone for now resulted most global market to rebound higher after previous slump. Back home, market sentiment turned negative over convincing news on paper shows reasons of no general election for this year.
Daily chart formed a down doji bar candle closed below middle Bollinger band support level after market opened lower, edge upwards into positive territory followed by 2nd session falls lower the closed near the low of the day.
Chart study remained suggesting a pullback correction little upside biased market development with MACD indicator having negative cross down.
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.

20111111 1705 Regional Markets EOD Daily Chart Study.

DJIA chart reading :  pullback correction upside biased with MACD cross down.
  Hang Seng chart reading :  pullback correction upside biased with MACD cross down.
KLCI chart reading :  pullback correction little upside biased.

20111111 1644 Global Market & Commodities Related News.

Asian shares edge up, on course for weekly loss
SINGAPORE, Nov 11 (Reuters) - Asian shares rebounded modestly and the euro clung to tentative gains, after brighter corporate news lifted U.S. stocks and debt-ladened Italy was able to fund itself at a bond auction.
"It's very difficult to trade these days, what with the binary headlines coming out of Europe," said a Singapore-based credit market trader with an Asian bank.

Asian Stocks Rise on U.S. Jobless Data, Easing Europe Concern (Bloomberg)
Asian stocks rose, rebounding from the biggest decline in seven weeks yesterday, as U.S. jobless claims fell and the selection of a new Greek premier tempered concern Europe’s debt crisis won’t be contained. Sony Corp. (6758), Japan’s biggest exporter of consumer electronics, climbed 2.4 percent. China Petroleum & Chemical Corp. (600028), Asia’s biggest refiner, rose 3.2 percent in Hong Kong after its parent agreed to buy a 30 percent stake in Galp Energia SGPS SA’s Brazil unit. Genting Singapore Plc (GENS) slumped 5.3 percent after Citigroup Inc. lowered its rating to “sell” as the casino-resort operator posted earnings that missed analysts’ estimates. “The U.S. is doing alright,” said Andrew Pease, Sydney- based senior investment strategist for the Asia-Pacific region at Russell Investment Group. “So far the contagion from Europe to the U.S. that everyone has been worried about seems to be fairly limited. That’s a good sign. But Europe is going to get worse before it gets better.”

Spain Economy Stalls as Borrowing Costs Surge (Bloomberg)
Spain’s economy stalled in the third quarter, undermining the country’s efforts to shield itself from the sovereign debt crisis after Spanish and Italian borrowing costs surged to records. Gross domestic product was unchanged from the previous quarter, when it expanded 0.2 percent, the National Statistics Institute said today in an e-mailed statement in Madrid. From a year earlier, the economy expanded 0.8 percent. The Bank of Spain estimated on Oct. 31 that the economy stalled in the third quarter and grew 0.7 percent on the year. The slowdown threatens Spain’s budget-deficit goals, the European Commission said yesterday, meaning the government that emerges from the Nov. 20 general election may have to accelerate spending cuts to prevent the nation becoming the next victim of the debt crisis. The People’s Party, which polls show will win, has pledged to regain Spain’s AAA rating and tame borrowing costs without raising taxes or cutting pensions.

FOREX-Euro stays above 1-month low but seen vulnerable
SINGAPORE, Nov 11 (Reuters) - The euro inched higher and held above its recent one-month low on Friday, but market players were sceptical that it would see a sustained bounce due to uncertainty over whether Italy will make progress on fiscal reforms under new leadership.
The euro has gained some reprieve after a sell-off earlier in the week when Italian 10-year bond yields shot above the 7 percent level that is widely regarded as unsustainable.

U.S. wheat futures stage modest recovery
SYDNEY, Nov 11 (Reuters) - U.S. wheat futures posted modest gains as bargain hunters stepped in after a fall of nearly 4 percent the previous session when investors dumped contracts, spooked by weak U.S. grain exports and the fallout from Europe's debt crisis.
"Basically, people are taking advantage of the sell-off," said Jonathan Barratt, head of Sydney-based Commodity Brokering Services.

Smart traders humbled by cotton market's wild swings
Nov 10 (Reuters) - Global commodity trading houses have long defended their billion-dollar profits -- the subject of ire and envy by farmers, miners and small producers -- as just reward for taking big risks in opaque markets.
This year's gyrations in the cotton market supported that mantra as a "perfect storm" of volatility made losers out of some of the market's smartest traders, sapped profits and toppled a CEO. And the damage may not be over.

Argentine rains could prompt soy area expansion
BUENOS AIRES, Nov 10 (Reuters) - Major world soy supplier Argentina got heavy rains over the last week that could set the stage for a larger-than-expected area to be planted this season, the Buenos Aires Grains Exchange said on Thursday.
The exchange did not boost its soy area estimate but said it might if good weather encourages farmers to devote more land to the crop.

Mexico sugar chamber raises production forecast
MEXICO CITY, Nov 10 (Reuters) - Mexico's sugar production will be about 5.3 million tonnes in the 2011/12 season, up from a previous estimate of 5 million tonnes, helped by higher prices and more sugar being planted, the sugar industry chamber said on Thursday.
Exports in the 2011/12 season, which began in November, will be about the same as last year at around 1.4 million tonnes, the chamber's director, Juan Cortina, told reporters.

Brent steady above $113; eyes euro zone debt
SINGAPORE, Nov 11 (Reuters) - Brent crude was steady above $113 a barrel, after sharp gains in the previous session, as lingering concerns over Europe's debt crisis prompted investors to stay cautious.
"We had some good news yesterday from Italy on their bond sale, but the oil market is trading from headline to headline," said Ben Le Brun, market analyst at OptionsXpress in Sydney. "Right now there's not enough to give investors a clear direction for prices."

Shell, Petronas to improve oil output offshore Malaysia
SINGAPORE, Nov 11 (Reuters) - Royal Dutch Shell  and Malaysian state-owned firm Petronas signed an agreement on Friday to improve oil output at fields offshore Sarawak and Sabah.
The improvement may result in an additional 90,000 to 100,000 barrels per day (bpd) of oil production and extend the life of the Baram Delta and North Sabah fields to beyond 2040, Shell said in a statement.

China's Baosteel cuts main product prices for Dec
SHANGHAI, Nov 11 (Reuters) - China's Baoshan Iron & Steel  will cut its main product prices for December bookings, the company said on Friday, a move reflecting the weakness in steel demand in the final month of 2011.
The company, also known as Baosteel, plans to slash hot-rolled coil prices by 200 yuan ($32) per tonne and cold-rolled coil prices by 300 yuan per tonne, after it kept its main steel product prices unchanged in November from October.

Japan Q1 aluminium premiums may ease
TOKYO, Nov 10 (Reuters) - Term premiums on aluminium shipments to Japan for January-March will likely ease as domestic demand is slowing after devastating floods in Thailand caused many Japanese firms to curb output of consumer goods using parts made in Thailand, traders said.
Japan consumes around 2 million tonnes per year of aluminium, equivalent to about 5 percent of global demand.

Copper up; Italy, Greece on track to form unity govts
SHANGHAI, Nov 11 (Reuters) - Copper edged up after Italian and Greek politicians moved to form unity governments to champion the measures needed to tackle the euro zone debt crisis, but lingering worries over a global economic slowdown will keep investors cautious.
"We are seeing a technical adjustment today based on the improved sentiment as indicated in the lift in U.S. and European equities. The Italian and Greek political development was encouraging and I believe that world leaders will make sure there will be no defaults by those two countries in the short term," said China Futures Co analyst Yang Jun.

China copper imports strong but bulls beware!: Andy Home  
--Andy Home is a Reuters columnist. The opinions expressed are his own--
LONDON, Nov 10 (Reuters) - China's copper imports in October were the highest monthly total since May 2010 and confirm that the step-change in September was not a statistical blip.
At 383,507 tonnes aggregate imports of refined copper, copper alloy, copper anode and copper products were marginally up on September's figure and a lot higher than the subdued flows seen in the early part of this year, when China's copper sector was indestocking mode.

China's Oct copper imports edge up; Nov seen firm
HONG KONG, Nov 10 (Reuters) - China's imports of unwrought copper and semi-finished copper products edged up 0.8 percent in October due to steady demand from consumers and investors, and analysts expect shipments to remain firm in November as long as metal prices stay low.
Benchmark three-month London Metal Exchange copper prices  have lost more than 25 percent since hitting a record high above $10,000 per tonne in February. Copper was trading around $7,400 per tonne by 0654 GMT, after shedding almost 14 percent over the two months ended October.

China Oct copper imports shine, iron ore suffers
SHANGHAI, Nov 10 (Reuters) - China's October commodities trade data shows the winners and losers from the country's cooling economy -- copper imports rose for the fifth straight month, but a slump in iron ore shipments highlights the risks for raw materials linked to real estate.
The government's resolve to clamp down on the property sector means the steel and cement industries, and associated raw materials such as iron ore and coking coal, will remain mired for at least the next quarter.

METALS-Copper up; Italy, Greece on track to form unity govts
SHANGHAI, Nov 11 (Reuters) - Copper edged up on Friday after Italian and Greek politicians moved to form unity governments to champion the measures needed to tackle the euro zone debt crisis, but lingering worries over a global economic slowdown will keep investors cautious.
Three-month copper on the London Metal Exchange  inched up 1 percent to $7,550 a tonne by 0359 GMT, after falling to a two-week low and ending down 2 percent previously. It is headed for a fall of 4.1 percent on the week, its second such loss in a row.

PRECIOUS-Gold steady as Italy fear eases; Europe worries linger
SINGAPORE, Nov 11 (Reuters) - Gold prices traded steady on Friday, following encouraging signs that Italy was making an effort to ease its political turmoil and avert an economic disaster, while investors remain nervous about the unfolding euro zone debt crisis.
The uncertainty in solving the two-year-old debt crisis is likely to support safe haven interest in gold, but a widespread sell-off in response to disastrous news out of the euro zone could sink gold as investors are forced to liquidate their  positions to cover losses elsewhere.

Gold steady as Italy fear eases; Europe worries linger
SINGAPORE, Nov 11 (Reuters) - Gold prices traded steady, following encouraging signs that Italy was making an effort to ease its political turmoil and avert an economic disaster, while investors remain nervous about the unfolding euro zone debt crisis.
"The whole situation in Europe still worries people -- Italy bonds, French bonds, euro zone exit," said a Singapore-based trader, adding the danger of liquidation could hit gold in the short term.

20111111 1111 Global Market & Commodities Related News.

Bank of Korea Holds Rate for 5th Month (Bloomberg)
The Bank of Korea held off from raising borrowing costs for a fifth straight month as Europe’s deepening debt crisis and slowing domestic growth prompt the central bank to pause its fight against inflation. Governor Kim Choong Soo and his board kept the benchmark seven-day repurchase rate at 3.25 percent, the central bank said in a statement in Seoul today. The decision was predicted by all 17 economists surveyed by Bloomberg News. Kim’s board joins policy makers from China to Indonesia to Australia that have moved to support economic growth by refraining from raising borrowing costs or by lowering them. Asian shares tumbled yesterday as Europe’s debt woes drove Italian bond yields above the 7 percent level at which Greece, Ireland and Portugal sought international bailouts.

China’s Stocks Swing Between Gains, Losses Before Future Share Offerings (Bloomberg)
China’s stocks swung between gains and losses as speculation the government may ease monetary policy countered concern initial public offerings will lure funds away from existing equities. China Shenhua Energy Co., the country’s biggest coal producer, and Yanzhou Coal Mining Co. advanced after the Shanghai Securities News said the government will encourage mergers in the industry. Sinochem Corp. said it plans to raise as much as 35 billion yuan ($5.5 billion) in an initial public offering to fund an oil refinery project, in what would be China’s sixth-biggest IPO. The Shanghai Composite Index added 0.22, or less than 0.1 percent, to 2,479.76 as of 10:24 a.m. local time, after falling 0.1 percent. The gauge has lost 1.9 percent this week. The CSI 300 Index (SHSZ300) rose less than 0.1 percent to 2,700.48 today. The Bloomberg China-US 55 Index climbed 1 percent, the most in a week, to 100.89 at the close of trading in New York.

Europe Must ‘Move Quickly’ to Stability: Geithner (Bloomberg)
U.S Treasury Secretary Timothy F. Geithner said Europe remains the “central challenge” to global growth and must “move quickly” to restore financial stability. Geithner, who is in Honolulu attending the 21-member Asia- Pacific Economic Cooperation conference, said in prepared remarks that the APEC countries are all directly affected by the Eurozone crisis and he encouraged them “to take steps to strengthen growth in the face of these pressures from Europe.” European finance ministers earlier this week failed to bridge divisions over the European Stability Mechanism, a permanent rescue fund aimed at stemming the growing crisis over sovereign debt facing countries like Greece and Italy. The world economy is in a “dangerous phase,” IMF Managing Director Christine Lagarde said this week.

GLOBAL MARKETS-Asian shares stage modest rebound, euro steady
SINGAPORE, Nov 11 (Reuters) - Asian shares rebounded modestly on Friday and the euro clung to tentative gains, after brighter corporate news lifted U.S. stocks and debt-ladened Italy was able to fund itself at a bond auction.
"Italy's funding vulnerability presents a serious risk to the global financial system and forces euro zone leaders to grapple with a lose/lose dilemma," wrote RBS macro credit analysts Edward Marrinan and Edward Young in a note.

COMMODITIES-Oil rebounds as euro recovers; other commods down
NEW YORK, Nov 10 (Reuters) - Oil prices rose on Thursday, rebounding after a one-day decline, but metals and crops slumped again on worries about the euro zone despite political progress in Italy after a change in government.
"I am a little surprised that after the beating we took (Wednesday) that we continue to do this," said Jack Scoville, an agricultural markets analyst at The Price Group in Chicago.

Crude jumps on Europe moves, data from US, China
NEW YORK, Nov 10 (Reuters) - Crude oil futures rebounded on Thursday, as investors saw some progress in Italy's efforts to solve its debt problems and U.S. data showed a slight improvement in the economy, beefing up appetite for risk.
"The jobless claims (data) helps us with our recovery hopes as the EU still tries to find answers to avoid another failure," said Carl Larry, president of Oil Outlooks LLC in New York.

Bad weather shutters Mexico's three main oil ports
MEXICO CITY, Nov 10 (Reuters) - Mexico's three main oil exporting ports remained closed on Thursday afternoon due to high winds and waves caused by a cold front, the government said.
Waves of 16 to 19 feet (4.9 to 5.8 meters) and winds up to 56 mph (90 kph) closed Coatzacoalcos port, one of Mexico's three main oil-exporting ports.

Natural gas ends down, storage climbs to near record
NEW YORK, Nov 10 (Reuters) - U.S. natural gas futures ended down slightly on Thursday in a seesaw session, as a bearish weekly inventory report that showed stocks near record-high levels offset early buying on slightly cooler forecasts.
"The weather turned a little colder overnight, so they tried to take it up early, but the (EIA inventory build) overwhelmed that, and we're still on track for at least two more builds," a Massachusetts-based trader said.

Euro Coal-Prices dip $1 despite oil, euro rise
LONDON, Nov 10 (Reuters) - South African prompt physical coal prices fell by just over $1.00 a tonne on Thursday, despite a rebound in oil prices, the euro and equities yet activity was limited.  
"Macro news and physical coal are in alignment, prices are moving together but there's no activity in coal in Europe or Asia," one major European trader said.

20111111 0958 Malaysia Corporate Related News.

Datuk Raymond Chan plans to offer construction contracts to  Harvest  Court Industries Bhd  (HCIB) and help turn around the loss-making  company. In an yesterday with BT, his privately-held company, Sagajuta (Sabah)  Sdn Bhd, now has close to RM1.2bn worth of construction contracts. Chan was clarifying earlier reports that he was injecting assets into HCIB. He said his  plans were only to “inject contracts to spruce up revenue”.  The deals will be awarded in phases and the first that has been offered  to HCIB is valued at RM129m. It involves building a 950-unit  condominium block called 1 Sulaiman Gold Tower in Kota Kinabalu. He  also wants to award a RM70m EPC (engineering, procurement,  construction and commissioning) contract to HCIB to set up a pulp and  paper plant in Negri Sembilan. The plant, owned by Chan‟s 1Green  Enviro Sdn Bhd, will convert biomass into paper.  Chan, who is a substantial shareholder in HCIB with a 13.8% stake, said  his proposals will be tabled out soon by the HCIB board. So far the  board has been quite receptive. Chan said if all goes well, the  construction jobs will provide HCIB with a healthy margin of over 10%,  “and this will definitely help revive the company within one year”.  Chan also said he is working closely with HCIB MD Ng Swee Kiat to  explore how best to raise capital for the company. This includes a rights  issue or share placement.  Chan first rose to prominence after cash-rich Sagajuta was linked to a  reverse takeover of Jerneh Asia Bhd, which is 37%-owned by Robert  Kuok. The talks in the end fell through due to a disagreement over  definitive terms.  HCIB posted a net loss of RM2.7m on revenues of RM6.4m in FY10. In  1HFY11, its net loss was RM0.7m on a turnover of RM6.1m. (BT)

Harvest Court, Sagajuta in RM129m deal on project
Harvest Court Industries' wholly-owned subsidiary has entered into a RM129m related party transaction with Sagajuta SB for the design and construction of a proposed mixed development in Sabah. The project, with an estimated gross development value of RM500m, will include 68 units of two-storey shoplexes, office blocks and a medium cost apartment. (Malaysian Reserve)

CIH raising cash distribution to RM724m from RM568m
CI Holdings yesterday announced that it would raise the proposed cash distribution – arising from the recent disposal of its beverage subsidiary Permanis SB – to RM724.2m from RM568m previously. The cash distribution will be carried out via a declaration of a special dividend and capital repayment. (Malaysian Reserve)

KPJ to build 5 state-of-the-art hospitals for RM760m
KPJ Healthcare is set to build five new state-of-the-art hospitals in Malaysia with an investment of RM760m, in line with the government’s intention of improving the health travel segment under its National Key Economic Areas. Out of the five, two hospitals will be opened next year, another two in 2013 and the final one in 2014. (Malaysian Reserve)

Benalec bags reclamation works in Johor
Benalac Holdings has secured land reclamation contracts from the Johor government to reclaim lands in Pengerang and Tanjung Piai. The two pieces of land in Johor measure 1,760 acres and 3,485 acres respectively. The contracts will be undertaken to facilitate the development of the Petroleum and Petrochemical Hubs and Maritime Industrial parks situated on the coasts of Pengerang and Tanjung Piai. (Malaysian Reserve)

UMLand buys company, land for RM30m
United Malayan Land yesterday announced that it has proposed to acquire Tentu Teguh SB (TTSB) for RM11m. With the acquisition, UMLand will subsequently avail itself to 332.68 acres of freehold land in the eastern corridor of Iskandar Malaysia, which TTSB bought in February this year for RM45m from SAP Holdings Bhd. (Malaysian Reserve)

A bigger slice of DiGi.Com
Telenor ASA, the largest phone company in the Nordic region, is in talks with the government about raising its stake in DiGi.Com. The interest comes about four years after it sold some shares to comply with a foreign ownership cap for the industry. It now owns 49% of DiGi. (BT)

AirAsia X waiting on markets for IPO, won’t pull it
Low-cost airline AirAsia X wants to see an improvement in the economic climate and markets before its planned public share offering, but there is no possibility it will scrap the plan, its CEO said yesterday. AirAsia X said in October that it would make an IPO of shares in 2012. It has not given the size of the planned IPO. (Financial Daily).

Dijaya Corp  and Ivory Properties Group have asked for a one-day  suspension in trading of their shares today pending a material announcement.  There is market speculation that the two developers could tie up to undertake a  major property project on Penang island, where Ivory Properties is one of the  most prominent developers. (Financial Daily)

Sime Darby Bhd will unveil its potential collaboration with the property  developer,  E&O  on Nov 25, says president Datuk Mohd Bakke Salleh. More  details would be known on that day, which is also the day that Sime will  announce its 1QFY12 results.  "We will announce the E&O collaboration, outlook for the next  FY as  well as Sime's 2012 KPI (Key Performance Index) target on Nov 25,"  Bakke said after its annual shareholders meeting. Bakke also said Sime  had no plans to increase its stake in E&O. (BT)

Petronas may add a power plant to its refinery and petrochemical integrated  development (Rapid) complex in Pengerang, Johor. “Rapid will require power.  It will also require gas. It will require energy and electricity, so there will be  power requirement,” Petronas executive vice-president (gas and power business)  Datuk Anuar Ahmad said.  The Rapid project, costing about RM60bn, is expected to be  commissioned by end-2016. It will have multinational  oil & gas companies as JV partners. (Star)

The West Coast Highway (WCE), which is expected to cost RM6.5bn, will  have a total of 16 tolls. Selangor state executive  councilor Datuk Dr Hasan Ali said that nine of the 16 tolls would be in Selangor. He said the project would  involve the acquisition of 77.8 acres of state land and 1,523.9 acres of private  land.  The highway was expected to cost RM3.5bn in the state alone.  Construction of the 286km-long highway, linking Banting in Selangor  and Changkat Jering in Perak, is expected to begin by December. (Star)

Johari Abdul Muid, 54, has been appointed the new MD of  RHB Bank while  Renzo Viegas will be the deputy MD. Both positions will be effective 14 Nov.  “Johari will drive the next stage of the group‟s commercial banking business in  Malaysia and the region. Viegas will primarily be responsible for the retail  banking and global financial banking businesses of RHB Bank,” the bank said.  (Star)

RHB Capital Bhd  has appointed Johari Abdul Muid as the new managing  director for RHB Bank Bhd. He will assume the position effective next Monday.  The position has been vacant since Datuk Tajuddin Atan left to join Bursa  Malaysia Bhd in April. Aged 54, Johari has more than 30 years of experience in  the financial sector. Prior to his appointment, Johari was a director of RHB  Capital Bhd, RHB Bank Bhd and RHB Islamic Bank Bhd, positions which he  held for over six years. Renzo Viegas, the current principal officer, will start his  new duties as deputy managing director also next Monday. (BT)

There is strong interest by firms wanting to be listed on the local bourse, says  Bursa Malaysia chief executive Datuk Tajuddin Atan. "There's no drying up in  the initial public offer (IPO) space. The IPO pipeline is strong, I think you will  see a lot of interests. I believe it is an issue of timing now, everybody is watching  what's happening in Europe and so forth.” (BT)

Melati Ehsan Holdings Bhd will design and build medium-cost flats in the  vicinity of Sentul, after clinching a RM297m contract from the Government. The company had announced earlier that it had won the contract to build residential  flats for the Housing and Local Government Ministry's People's Housing  Programme (PPR), without revealing further details. “It (Melati Ehsan) will be tasked with the design and building of the  flats, while the authorities are still responsible for selling and  distributing the units,” says a source. The land is currently occupied by  squatters, and it would be a resettlement plan (for the people staying  there) and the project would provide new residences for eager  homeowners. (Starbiz)

20111111 0957 Local & Global Economic Related News.

Malaysia: Industrial production growth slows after mining output falls
Malaysia’s industrial production growth slowed in September as a decline in mining output countered gains in manufacturing. Production at factories, utilities and mines gained 2.5% from a year earlier after rising a revised 3.7% in August, the statistics department said in a statement yesterday. Malaysia’s exports grew at the fastest pace in more than a year in September on higher sales of electronics and commodities, an acceleration that may be short-lived as Europe’s debt crisis and a faltering US recovery hurts orders. (Bloomberg)

PM Datuk Seri Najib Tun Razak yesterday announced the  ninth Economic  Transformation Programme (ETP) progress update which consists of 13  projects, nine new and four recapped, with total investment value of RM5.85bn.  All 13 projects were expected to contribute RM8.68bn to GNI and create an  estimated 16,902 jobs. With these new projects, the ETP has recorded  RM177.1bn in commitment investment, RM237.23bn in projected GNI and  389,263 potential new jobs. The nine new projects are: IBM will invest RM1bn in its Global Technology Services Centre in  Cyberjaya over the next five years. Toshiba will relocate its regional operational headquarters to Malaysia  with an investment of RM268m.  Akamai Technologies will collaborate with Telekom Malaysia on the  Netstorage project, involving an investment value of RM390,000. KPJ Healthcare Bhd will build five hospitals over the next three years  with an investment of RM763m. IOI Corp will invest RM130m on a new oleochemicals facility by 2013. Agilient Technologies will build a test and measurement hub with  investment value of RM212m. Google Inc is spearheading the „Get Malaysian Business Online‟ (GMBO)  initiative. The Pengagau Group will invest RM67.7m to strengthen its integrated  cage farming. Exotic Star S/B will invest RM80.31m in a modern one-stop centre for  fruit packaging and processing.  (Bernama, BT, Pemandu)

Manufacturing sales rose by 16.5% yoy to RM50.8bn in Sep (+11.2% to  RM50bn in Aug). On a mom basis, it increased by 1.6% (+0.6% in Aug). For  9M11, the sales up 11.3% to RM441.2bn. Total employees engaged in the manufacturing sector rose 2.5% yoy to  1.011m persons (+2.6% to 1.013m persons). Salaries & wages paid in Sep increased 7.6% yoy to RM2.36bn (+5% to  RM2.31bn). Average salaries & wages paid per employee soared 5% yoy to RM2,332  in Sept (+2.4% to RM2,282 in Aug).  Productivity grew by 13.7% yoy to RM50,262 (+8.4% to RM49,407 in  Aug). (Department of Statistics)

Small and Medium Enterprise Corp Malaysia (SME Corp) is working  closely with Bank Negara Malaysia and the Association of Banks in Malaysia  (ABM), to promote the 1-Innovation Certification for Enterprise Rating &  Transformation (1-InnoCERT) programme. Its chairman Datuk Ir Mohamed Al  Amin Abdul Majid said the effort would facilitate linkages between innovative  SMEs and banks.  To date, more than 400 SMEs had undertaken the online assessment  and of these, 97 had been 1-InnoCERT certified, he noted.  SME Corp will also organise five awareness workshops from 1o Nov 11  to 18 Feb 12, to guide interested SMEs on the application process.  (Bernama)

Malaysians have been invited to venture into Chile's mining sector which is  offering huge business opportunities. International Vice  Director, Exports  Promotion Bureau, Government of Chile Carlos Honorato Comandari said the  projects in the mining sector in Chile from now until 2016 were worth US$70bn  or about 40% of the US$200bn worth of projects in the Latin American  countries. "These  projects will also offer businesses and employment  opportunities in the services sector," he said. (Bernama)

A marked increase in trade between Malaysia and Chile is expected when the  Malaysia-Chile Free Trade Agreement (MCFTA) comes into force in early 2012,  said Deputy Minister of International Trade and Industry, Datuk Mukhriz  Mahathir. Mukhriz sees an increase in Malaysia's export of electrical and  electronic (E&E) products and components to Chile which is currently very  small.  He also said that Malaysians should explore opportunities in oil and gas  as well as palm oil.  Malaysia's trade with Chile has been on an uptrend since 2002, with the  trade value increasing from US$75.23m in 2002 to US$313.23m in  2010.  In the first nine months of this year, it  increased by a further 10%.  (Bernama)

Indonesia: Unexpectedly cuts rate to record low to aid growth

Indonesia unexpectedly cut interest rates by half a percentage point to a record low to shield the economy from a faltering global recovery. The IDR weakened. Bank Indonesia lowered the reference rate to 6%, it said in a statement yesterday. The world’s fourth-most populous nation joins countries from Brazil to Australia in lowering borrowing costs to boost spending at home, as Europe’s debt crisis and elevated US unemployment threaten exports. Indonesian inflation eased to 4.42% last month, the slowest pace in more than a year, encouraging officials to add to October’s quarter-point rate cut. (Bloomberg)

China: Export growth at 2-year low as Europe clouds outlook
China’s exports rose at the slowest pace in almost two years in October as Europe’s deepening debt crisis crimped demand, adding pressure on policy makers to support growth in the world’s second-biggest economy. Overseas shipments rose 15.9% from a year earlier, customs bureau data showed yesterday. The trade surplus was USD17bn. Imports climbed a more-than-forecast at 28.7%. (Bloomberg)

Philippine exports fell for the fifth straight month in Sep, contracting by  27.4% yoy (-13.7% in Aug) to US$3.88bn. Economists expected a decline of  19.3% yoy. (WSJ)

China’s exports  rose 15.9% yoy in Oct (+13.1% in Sep) while imports rose  28.7% (+20.9% in Sep). The trade surplus was US$17.03bn, up from  US$14.51bn. The market was expecting exports and imports to grow 16.1% and  22.2% respectively. (Bloomberg)

Thailand’s consumer confidence index fell from 72.2 in Sep to 62.8 in  Oct. (Bloomberg)

Japan’s machinery orders, an indicator of future capital spending, fell 8.2%  mom in Sep (+11% in Aug), the Cabinet Office said. Economists expected a 7.1%  fall. (Bloomberg)

Japan's consumer confidence index was 38.6 in Oct, unchanged from Sep.  A reading below 50 suggests consumer pessimism. Economists expected a  reading of 39.0. (Reuters)

European efforts to speed the setup of a permanent rescue fund have lost  momentum amid a clash between Germany and France over provisions to force  bondholders to share losses, three people involved in the negotiations said.  Finance ministers failed to bridge divisions this week over the European  Stability Mechanism, lessening the chances of activating its €500bn (US$680bn) war chest next Jul, said the people, who declined to be identified because the  talks are in progress. Officials had hoped to bring the ESM‟s start date forward  to mid-2012 from its ultimate deadline of Jul 2013, the people said.  (Bloomberg)

An increase in power tariffs in India is inevitable given the sharp rise in coal  prices, which have risen more than 20% yoy, the head of India's central  electricity regulatory commission told reporters on Thursday. (Reuters)

EU: The new Greek government led by Papademos will seek to avoid collapse
The new Greek unity government led by Lucas Papademos, former vice president of the European Central Bank, will face the task of securing funds to avert the country’s economic collapse. President Karolos Papoulias gave Papademos the mandate to form a government after receiving proposals from PM George Papandreou, Antonis Samaras, leader of the opposition New Democracy party, and opposition LAOS party leader George Karatzaferis, according to a statement from the president’s office in Athens. The new government will be sworn in today at 2pm local time. Papademos’s appointment ended four days of wrangling between Papandreou and other party leaders. (Bloomberg)

EU: Italy sells maximum amount at 1-year bill sale as yield surges
Italy sold EUR5bn (USD6.8bn) of one-year bills, the maximum for the auction, and demand rose as the Treasury lured investors with the highest yield in 14 years after debt-crisis contagion sent borrowing costs to records. The Rome-based Treasury sold the bills to yield 6.087%, the highest since September 1997 and up from 3.57% at the last auction on 11 Oct. Demand was 1.99x the amount on offer, compared with 1.88x last month. The yield on Italy’s benchmark 10-year bond fell below 7% after the auction from a euro-era record 7.45%. (Bloomberg)

EU: Lowers Euro-region growth forecasts on worsening crisis
The European Commission cut its euro-region growth forecast for next year by more than half and said it sees the risk of a recession as leaders struggle to contain the fiscal crisis. GDP may grow 1.5% this year and 0.5% in 2012, the Brussels-based commission said yesterday. It had earlier projected the 17-member region to expand 1.6% and 1.8% this year and next, respectively. (Bloomberg)

UK: BOE keeps bond-purchase target on hold at GBP275bn
The Bank of England maintained its target for asset purchases as policy makers gauged the capacity of their second round of stimulus to ward off the danger posed by Europe’s debt crisis. The nine-member Monetary Policy Committee led by Governor Mervyn King held the ceiling for so-called quantitative easing (QE) at GBP275bn (USD438Bn). The bank, which expanded QE by GBP75bn last month, said the current purchases will take another three months to complete and the “scale of the programme will be kept under review.” (Bloomberg)

US: Trade deficit, claims show improving growth
The US trade deficit unexpectedly narrowed in September on record exports and jobless claims fell to a seven-month low, indicating the world’s largest economy may be poised to strengthen. The trade shortfall shrank 4% to USD43.1bn from a revised USD44.9bn in August that was smaller than initially reported, the Commerce Department said. First-time applications for unemployment benefits declined by 10k to 390k last week, the Labor Department said. (Bloomberg)

US stocks rise on jobless claims drop as Europe concern eases
US stocks advanced, rebounding from yesterday’s tumble, as jobless claims declined while a retreat in Italian bond yields and the selection of a new Greek premier tempered concern about Europe’s debt crisis. The S&P 500 added 0.9% to 1,239.70 pts. The benchmark gauge for American equities lost 3.7% yesterday as one out of 500 stocks in the index gained, the fewest since June 2010. The Dow Jones Industrial Average advanced 112.92 pts, or 1%, to 11,893.86. (Bloomberg)

US imported goods price index declined 0.6% mom in Oct (no change in Sep),  Labor Department figures showed. Economists projected the gauge would also  be unchanged in Oct. (Bloomberg)

US initial jobless claims fell  10,000 to a seasonally adjusted 390k in the  week ended 5 Nov (400k in the prior week). Economists expected the reading to  be slightly below 400k. US continuing claims fell 92k in the week ended 29 Oct  to 3.615m. (Reuters)

20111111 0948 Global Market Related News.

Asia Stocks Rise on U.S. Jobless Claims (Source: Bloomberg)
Asian stocks rose after U.S. jobless claims fell to the lowest level in seven months and the selection of a new Greek premier tempered concern about Europe’s debt crisis, boosting investor demand for riskier assets. LG Electronics Inc. (066570), the South Korean handset maker that counts North America as its biggest market, gained 1.8 percent in Seoul. Hynix Semiconductor Inc. advanced 2.8 percent after SK Telecom Co., South Korea’s No. 1 mobile-phone company, offered to buy 20 percent of the world’s second-largest memory-chip maker. Rio Tinto Group, the world’s No. 2 mining company by sales, slipped 0.9 percent in Sydney as copper futures extended losses.
“The news headlines have been all about Europe, and behind the scenes, the U.S. economy has significantly improved with increasing positive economic data,” said Stan Shamu, a strategist at IG Markets in Melbourne. “Some companies with established earnings will get a bit of traction from investors who are looking into gaining a bit of value, but at the same time, the headline risk is still very high.”

U.S. Stocks Rise on Jobless Claims Drop as Europe Concern Eases (Source: Bloomberg)
U.S. stocks advanced, rebounding from yesterday’s tumble, as jobless claims declined while a retreat in Italian bond yields and the selection of a new Greek premier tempered concern about Europe’s debt crisis. Energy shares had the biggest gain in the Standard & Poor’s 500 Index among 10 groups, rising 1.8 percent as oil rallied. Cisco Systems Inc. (CSCO), the largest maker of networking equipment, climbed 5.7 percent as profit and sales beat estimates. Merck & Co. jumped 3.5 percent after raising its dividend. Apple Inc. (AAPL) slumped 2.6 percent amid concern that the company may ship fewer units of its iPad tablet this year due to supply constraints. The S&P 500 added 0.9 percent to 1,239.70 as of 4 p.m. New York time. The benchmark gauge for American equities lost 3.7 percent yesterday as one out of 500 stocks in the index gained, the fewest since June 2010. The Dow Jones Industrial Average advanced 112.92 points, or 1 percent, to 11,893.86.

Japan Stocks Rise as U.S. Jobless Claims Fall, Europe Debt Concern Eases (Source: Bloomberg)
Nov. 11 (Bloomberg) -- Japanese stocks rose, rebounding from a five-week low, after U.S. jobless claims fell to the lowest level in seven months while concern eased about Europe’s debt crisis, boosting investor demand for riskier assets. Fanuc Corp. (6954), a maker of factory robotics that gets 75 percent of its sales abroad, rose 2.1 percent. Inpex Corp. (1605), Japan’s No. 1 energy explorer, advanced 1.2 percent after oil rose to a three-month high. Olympus Corp. (7733), an endoscope maker, slumped 9.3 percent after the firm was placed on Tokyo Stock Exchange Group Inc.’s so-called watchlist for possible delisting after admitting to hiding losses. The Nikkei 225 (NKY) Stock Average gained 0.7 percent to 8,557.15 as of 9:17 a.m. in Tokyo. The broader Topix index advanced 0.3 percent to 732.46, set for a 2.6 percent loss this week. For the week, the Nikkei has fallen 2.8 percent. The gauge has swung between weekly gains and losses for 10 weeks, the longest up- and-down period since at least February 1989.

Stocks, Euro Advance as Greece Names Premier (Source: Bloomberg)
Stocks rose, with the Standard & Poor’s 500 Index rebounding from its worst drop since August, as jobless claims fell while a retreat in Italian bond yields and the selection of a new Greek premier tempered concern about Europe’s crisis. The euro gained and Treasuries slid. The S&P 500 rose 0.9 percent to close at 1,239.7 at 4 p.m. in New York. Italy’s 10-year bond yield, which surged to a record yesterday, dropped 36 basis points to 6.89 percent today as the European Central Bank bought the country’s debt and the nation sold all the bills planned at an auction. The euro appreciated 0.4 percent to $1.3601. Cotton and oil rose at least 1.8 percent to lead commodities higher. Ten-year Treasury yields lost six basis points.
U.S. equities resumed gains after falling earlier amid a surge in French bond yields. Stocks recovered as S&P said it did not cut France’s credit rating, clarifying a statement that suggested the rating had changed. Equities rallied as U.S. initial jobless claims decreased to the lowest level in seven months, Italy sold 5 billion euros ($6.8 billion) of one-year bills and former vice president of the European Central Bank Lucas Papademos was named Greece’s interim leader.

Bernanke Says Treasuries Remain ‘Safe Haven’ After S&P’s August Downgrade (Source: Bloomberg)
Federal Reserve Chairman Ben S. Bernanke said U.S. Treasury securities remain a “safe haven” for investors after Standard & Poor’s lowered its credit rating on the nation’s debt in August. “The downgrade didn’t scare off any investors,” and the action, along with the prospect of other downgrades, hasn’t done “significant damage” to the economy, Bernanke said today in response to a question at a town-hall-style event in El Paso, Texas. At the same time, the nation must take measures to establish a sustainable path for the national debt amid rising Social Security and health-care costs, he said. Treasuries rallied after the Standard & Poor’s rating cut, sending the government’s borrowing costs to record lows, as investors disregarded the firm’s warning about increased risks in U.S. debt to seek safety from Europe’s credit turmoil. Treasuries returned 6.4 percent in the third quarter, the most since 2008, compared with a 14 percent drop in the benchmark S&P 500 Index.

U.S. Trade Gap Narrows, Jobless Claims Fall in Signs of Improving Growth (Source: Bloomberg)
The U.S. trade deficit unexpectedly narrowed in September on record exports and jobless claims fell to a seven-month low, indicating the world’s largest economy may be poised to strengthen. The trade shortfall shrank 4 percent to $43.1 billion from a revised $44.9 billion in August that was smaller than initially reported, the Commerce Department said in Washington. First-time applications for unemployment benefits declined by 10,000 to 390,000 last week, the Labor Department said. The smaller trade bill may contribute more to the rebound in third-quarter growth than first estimated as overseas demand encourages U.S. factories to boost production. A sustained decline in applications for unemployment benefits may be the first step to a pickup in hiring that’s needed to spur household purchases, the biggest part of the economy.
“The economy is clearly regaining its footing,” said Millan Mulraine, a senior U.S. strategist at TD Securities in New York, who predicted the trade deficit would shrink and jobless claims would decline. “While global economic activity is slowing, it hasn’t collapsed, so the U.S. will be able to sustain healthy gains in exports. The deceleration in the pace of layoffs is positive for the outlook on consumer spending.”

U.S. Budget Gap Narrowed to $98.5 Billion in October on More Tax Receipts (Source: Bloomberg)
The U.S. government’s budget deficit narrowed in October, the first month of the new fiscal year, reflecting a calendar-related reduction in spending and an increase in tax receipts. The $98.5 billion shortfall is smaller than the $140.4 billion deficit posted in the same month last fiscal year, according to Treasury Department data issued today in Washington. Economists projected a $102.5 billion gap, according to the median estimate in a Bloomberg News survey. The narrowing comes as a 12-member congressional supercommittee of Democrats and Republicans tries to find $1.5 trillion in savings over the next decade before an approaching deadline triggers spending cuts. America’s budget deficit was 8.7 percent of gross domestic product in fiscal 2011, the third- highest since 1945.

Sinochem Plans China’s Biggest IPO This Year (Source: Bloomberg)
Sinochem Corp. plans to raise as much as 35 billion yuan ($5.5 billion) in an initial public offering to fund an oil refinery project, in what would be China’s sixth-biggest IPO.  The country’s largest supplier of chemical products aims to sell as much as 26.5 billion new shares in Shanghai, according to a statement posted on the Ministry of Environmental Protection’s website yesterday. The unit of Sinochem Group will use the proceeds for a refinery in Fujian, the statement said.  Companies have raised $37 billion in IPOs in China this year, more than double the proceeds in Hong Kong, according to data compiled by Bloomberg. The Sinochem IPO comes less than a month after Sinohydro Group Ltd., the country’s largest builder of hydroelectric dams, raised 13.5 billion yuan in what was the largest offering this year, Bloomberg data show.

Analysts See Biggest Gain in China Property (Source: Bloomberg)
Analysts’ forecasts show real-estate stocks will rally more than any other industry in China during the next year, even as wagers on declines climb to the highest level since at least 2008. Developers in the MSCI China Index will surge 46 percent on average by November 2012, the most among 21 groups in the equity gauge, based on analysts’ estimates compiled by Bloomberg. At the same time, bearish bets on property companies have doubled to 12 percent of shares available for trading this year, according to Data Explorers, a London-based research firm. Bulls say speculation about the bursting of an asset bubble in China’s property market is overblown and the shares are cheap after the average price-earnings ratio for the group fell 44 percent from an April peak to 5.77. Bears say real-estate stocks will extend this year’s slump after housing transactions in October fell for the first time in three months and government officials pledged to maintain real-estate curbs.

Japan’s Exit From Slump May Be Short-Lived (Source: Bloomberg)
Nov. 11 (Bloomberg) -- Japan’s economy probably expanded at the fastest pace in more than a year last quarter, a rebound that may not be sustained as Europe’s debt crisis sends stocks plunging and boosts the yen. Gross domestic product grew at an annual 5.9 percent in the three months ended Sept. 30, reversing three consecutive quarters of contraction, according to the median forecast of 24 analysts surveyed by Bloomberg News. The Cabinet Office will release the report at 8:50 a.m. in Tokyo on Nov. 14. A resurgence in production and exports by companies including Toyota Motor Corp. (7203) is showing signs of waning as a yen trading near postwar highs against the dollar forces companies to cut their profit forecasts. A report on machinery orders yesterday indicated companies may pare spending into next year as they brace for a slowdown in global demand.

Japan’s Azumi on Guard Against Yen Moves (Source: Bloomberg)
Japanese Finance Minister Jun Azumi said he’s on guard against speculative yen trades while declining to comment on whether the nation has been selling the currency this month. “I’m watching markets with great interest for speculative trading and excessive movements,” Azumi told reporters in Tokyo today. “I think unstable factors for markets including stocks are increasing since last week because of Europe, especially after problems emerged in Italy.” The yen has strengthened more than 2 percent against the dollar from a low of 79.53 on Oct. 31 after Japan’s third publicly announced intervention this year. Azumi may have ordered more yen sales since then, Totan Research Co. said Nov. 9, citing analysis of the Bank of Japan’s current account and bond holdings.

Indonesia Bets on Rate Cuts Aiding Growth as Euro Crisis Defuses Inflation (Source: Bloomberg)
Indonesia’s central bank is betting the threat to economic growth from the European debt crisis outweighs the risk that yesterday’s cut in interest rates to a record low will fuel inflation. Bank Indonesia lowered the reference rate by half a percentage point to 6 percent, it said in a statement in Jakarta, confounding all 19 economists surveyed by Bloomberg News. Eight had predicted a quarter-point reduction after a similar move last month, and the rest no change. The cut is the biggest since March 2009. The world’s fourth-most populous nation is among countries from Brazil to Australia that have lowered borrowing costs as the global economy falters. The rupiah extended its decline after the decision, highlighting concern that a weakening currency may boost import costs.

Recession Risk Grows for Euro Region as Commission Reduces 2012 Forecast (Source: Bloomberg)
The European Commission cut its euro-region growth forecast for next year by more than half and said it sees the risk of a recession as leaders struggle to contain the fiscal crisis. Gross domestic product may grow 1.5 percent this year and 0.5 percent in 2012, the Brussels-based commission said today. It had earlier projected the 17-nation region to expand 1.6 percent and 1.8 percent this year and next, respectively. In 2013, the economy may expand 1.3 percent, the commission said. The euro-area economy is edging toward recession as governments are seeking ways to end the turmoil that has rattled global equity markets. In Italy, Prime Minister Silvio Berlusconi failed to convince investors that his country can slash the region’s second-largest debt burden. The commission said the risk of an economic contraction is “not negligible” and identified the fiscal crisis among the main threats.

Bank of England Keeps Asset Purchase Program Steady, Holds Benchmark Rate (Source: Bloomberg)
The Bank of England maintained its target for asset purchases as policy makers gauged the capacity of their second round of stimulus to ward off the danger posed by Europe’s debt crisis. The nine-member Monetary Policy Committee led by Governor Mervyn King held the ceiling for so-called quantitative easing at 275 billion pounds ($438 billion), as forecast by all 38 economists in a Bloomberg News survey. The bank, which expanded QE by 75 billion pounds last month, said the current purchases will take another three months to complete and the “scale of the program will be kept under review.” Europe’s debt turmoil has spread to Italy, further threatening Britain’s recovery, and the European Commission said today there’s a risk of a contraction in the U.K. economy in “at least one of the next few quarters.” The Bank of England may lower growth projections in its Inflation Report next week, which King will present at a press conference.

ECB’s Policy Makers Say They Can’t Do Much More to Stem Financial Crisis (Source: Bloomberg)
European Central Bank policy makers said the bank can’t do much more to stem the region’s sovereign debt crisis, suggesting they are reluctant to significantly ramp up bond purchases to lower Italy’s borrowing costs. “Not much more can be expected from us, it’s up to the governments,” Governing Council member Klaas Knot, who heads the Dutch central bank, told lawmakers in The Hague today. Three other policy makers have also publicly rejected calls for more ECB intervention and two further officials, who spoke on condition of anonymity, said the central bank has no plans to make its purchase program unlimited.
Bond yields in Italy, the third-largest economy in the 17- nation euro region, have surged above the 7 percent level that led Greece, Portugal and Ireland to seek bailouts from the European Union and International Monetary Fund. With politicians still unable to find a solution to the debt crisis that has raged for two years, the ECB is being asked to step into the breach to hold Europe’s monetary union together.

Italy Bond Attack Breaches Euro Defenses as Crisis Worsens (Source: Bloomberg)
The euro region’s defenses are being breached. Investors yesterday propelled Italy’s 10-year bond yield to close at a euro-era high of 7.25 percent after the promised exit of Prime Minister Silvio Berlusconi failed to convince them that his country can slash Europe’s second-largest debt burden. The biggest signal yet that the single currency’s third- largest economy is falling prey to its two-year debt crisis forces German Chancellor Angela Merkel, European Central Bank President Mario Draghi and their peers to decide just how far they’re willing to go to defend the euro. “The market is testing the commitment of the euro zone’s stewards,” said Eric Chaney, Paris-based chief economist at insurer AXA SA and a former official in the French Finance Ministry. “Italy is the real crisis battleground.”

Greek Unity Government Led by Lucas Papademos Will Seek to Avoid Collapse (Source: Bloomberg)
The new Greek unity government led by Lucas Papademos, former vice president of the European Central Bank, will face the task of securing funds to avert the country’s economic collapse. President Karolos Papoulias gave Papademos the mandate to form a government after receiving proposals from Prime Minister George Papandreou, Antonis Samaras, leader of the opposition New Democracy party, and opposition LAOS party leader George Karatzaferis, according to an e-mailed statement from the president’s office in Athens. The new government will be sworn in today at 2 p.m. “I am not a politician but I have dedicated the biggest part of my professional life to economic policy both in Greece and Europe,” Papademos told reporters after being named. “The Greek economy still faces huge problems despite the huge efforts that have been made for fiscal consolidation and to improve competitiveness. Greece is at a critical crossroads.”

20111111 0947 Global Commodities Related News.

Illinois Schedules Vote On Tax Breaks For CME, CBOE (Source: CME)
Illinois legislators aim to complete a deal granting tax relief to the state's derivatives exchanges before Thanksgiving even though that might not be soon enough to prevent the exchanges from moving their headquarters to a more tax-friendly state. Lawmakers have yet to agree on a plan to reduce taxes for CME Group Inc. and CBOE Holdings Inc. as they debate broader legislation that adds incentives to keep Sears Holdings Corp. in Illinois, too. Other provisions include a multiyear extension of research-and-development tax credits for all Illinois businesses and tax relief for workers, even as Illinois struggles to overcome massive budget deficits. Hearings on the bill are scheduled for next Wednesday and Friday, with votes by the full Illinois Senate and House of Representatives on Nov. 21, according to John Bradley, chairman of the House Revenue and Finance Committee. "It's a Herculean effort," said Bradley, referring to the legislative schedule.
"We want to get something done as soon as we can, but we want to make sure we get it right," said Bradley, during a phone interview. Testifying before Bradley's committee Tuesday evening, CME Chairman Terry Duffy urged lawmakers to vote on the plan this week, stating that he did not want to limit the options of CME's board of directors. CME's board is considering what Duffy described as "very, very lucrative" offers from other states. It is unclear whether CME and CBOE have agreed to the delay. Representatives for both exchanges declined to comment on the latest developments. The exchanges have waged a public battle on what they view as an unfair tax burden after the Illinois legislature in January raised the corporate income tax to 7%, from 4.8%. The tax increase costs CME an extra $50 million a year, according to Duffy. CME pays 6% of all corporate taxes paid in Illinois, which Duffy said is "not acceptable."
A measure introduced by Illinois Senate President John Cullerton would tax the exchanges on only about 25.7% of the trades performed on their electronic platforms. Currently, they pay taxes on all electronic transactions, which make up the vast majority of the derivatives business. Duffy warned that if CME moves its headquarters elsewhere, it would also relocate its Globex electronic control center, now based in Aurora, Ill. Only the trading floors at the Chicago Board of Trade would remain, which account for less than 5% of CME's business, said Duffy. CME, owner of the Chicago Mercantile Exchange and CBOT, has been based in Illinois for 163 years. CME is the world's largest futures exchange as measured by trading volume, and CBOE is the largest options exchange in the U.S.

McDonald's To Raise Capex In 2012, Sees Commodity Costs Rising (Source: CME)
McDonald's Corp. said it would boost capital expenditure to $2.9 billion next year, opening 1,325 new outlets and continuing the revamp of existing locations. The world's largest restaurant chain by revenue also reaffirmed its expansion goals, targeting annual average sales growth of 3% to 5%, with operating income rising by 6% to 7% and return on incremental invested capital in a high teen percentage. Income from franchised restaurants has been the largest driver of profit growth, though Chief Executive Jim Skinner said at the company's biennial investor conference that these would stay stable at around 80% of the global store count. Franchising accounts for 89% of U.S. stores, but penetration is small or non-existent in some large markets, including China. McDonald's plans to open 1,100 locations in 2011, and 750 of next year's expansion will be in Asia, the Middle East and Africa, together with 250 in Europe, 200 in the U.S. and Canada and 125 in Latin America. It's also renovating 2,400 current locations.
The rise in capex to $2.9 billion compares with the recently-lifted $2.6 billion slated for 2011. McDonald's also expects commodity costs for its overall basket of goods to rise 4.5% to 5.5% in the U.S. and 2.5% to 3.5% in Europe, with less pressure in the latter region because of lower chicken and dairy prices. Executives also said that its sponsorship of the summer Olympics in London, its annual convention and a technology upgrade would lead to one-off costs of around $100 million next year, accounting for around five cents or per-share earnings.

Corn (Source: CME)
US corn futures fell, bucking the supportive influence of sharply higher crude oil futures and US dollar weakness. Poor export demand reflected in USDA's weekly export sales report served as a catalyst to drag prices lower, analysts say. Export sales signal world buyers aren't interested in buying US supplies at current prices, analysts say. However, corn remained the strongest leg in CBOT grain complex, buoyed by tight cash supplies and robust demand from domestic end users such as ethanol processors and livestock feed industry, analysts add. CBOT Dec corn ended down 10 1/2c at $6.45 1/2/bushel.

Wheat (Source: CME)
US wheat futures ended lower amid weak export demand. Weekly export sales today confirmed ongoing trend of poor sales, with flood of Black Sea region competition beating out US supplies. Add to that ample South America supplies, analysts say. Rumors also that the US was importing some Brazilian wheat added to the pressure, and helped send nearby CBOT wheat even lower. Dec CBOT wheat ends down 23c to $6.20/bushel, while March CBOT wheat falls 15 1/4c to $6.47. KCBT Dec wheat down 16c to $6.97; MGEX Dec wheat down 6 1/4c to $9.45 1/2.

Rice (Source: CME)
US rice futures continued tumbling, ending lower on weak export demand and technical selling. Nov rice falls to fresh four-month low, and down 13% from an Oct 25 intraday high. Nov CBOT rice ends down 25c to $15.03 1/2 per hundredweight.

Thai Rice Exports Down On Floods, High Prices (Source: CME)
Thailand's October rice exports fell 24% on month to 628,837 metric tons as ongoing flooding and weak demand slowed shipments, the Thai Rice Exporters Association said. That was a 29% fall in shipments from the same month last year. November exports may fall further to around 500,000 tons or lower, the Association said. Thailand is world's biggest rice exporter, shipping more than $500 million worth of rice, supplying most markets including Sub-Saharan Africa. Monthly exports were more than 1 million tons in the first half of the year. With the slow-down in shipments in the second half, exports of parboiled rice fell 51% on month to 176,322 tons in October, the Association said. "Most of the central plains are still flooded and farmers are facing immense difficulty transporting grain to the mills," Managing Director of Bangkok-based exporter Uthai Produce Ltd., Chareon Laothamatas said.
There are currently nine ships loading around 270,000 tons of rice for exports at the Bangkok Port but no fresh orders are being placed, said Phaitoon Rasmee, manager at cargo surveyor Intertek Testing Services. Meanwhile, millers are holding back stocks in anticipation of higher prices from the government. Exporters said many of the traditional customers have turned to other suppliers such as India to source cheaper rice. Indian rice is at least $170/ton cheaper than Thai grades. The Middle East typically buys around 20% of its total requirement from Thailand and Vietnam and will now have to look at other origins to meet its needs, said Darren Cooper, a senior economist at the International Grains Council.
According to Chookiat Ophaswongse, honorary president of Thai Rice Exporters Association, the October numbers are much below initial expectations of more than 700,000 tons and indications are that volumes will fall further in November as farmers continue to bear the brunt of abnormally high water levels wi th at least 20% of the crop is badly affected. Thailand usually produces around 25 million tons of unmilled rice from its November-January harvest. Chookiat said harvesting has begun in north-eastern Thailand, the region least affected by flooding, but transportation of the grain to designated millers through which the government buys the grain has been difficult. Government procurement so far has been barely 300,000 tons. Because of logistical constraints, the Association has cancelled a survey planned earlier this month to assess the damage to the crop, Chookiat said.
Preliminary estimates indicate 3.0 million tons to 7.0 million tons of paddy could have been damaged by the floods, Cooper said.

India, Indonesia negotiate rice trade deals
NEW DELHI/JAKARTA, Nov 10 (Reuters) - Indonesia, the world's third-biggest rice consumer, has asked India for supplies of the staple food grain after floods hit top rice exporter Thailand, potentially disrupting shipments.
India, the world's second-biggest producer and consumer of rice, is willing to sell 500,000 tonnes from government stores as warehouses are overflowing after bumper harvests.

Australia overtakes Russia to become No.3 wheat exporter
SYDNEY, Nov 10 (Reuters) - Australian wheat shipments surged 36 percent to 18.6 million tonnes in the marketing year ended September, putting the country ahead of Russia as the world's third largest exporter of the grain.
Another bumper year is expected, with the country's government forecaster previously saying wheat exports could rise again to a record 20.4 million tonnes in the current marketing year.

Soybeans, Corn Drop as Bigger South America Crops May Slow U.S. Shipments (Source: Bloomberg)
Soybeans fell to the lowest in a month and corn dropped on speculation that rains will boost crops in South America, reducing demand for U.S. supplies. Rains in the next two weeks will benefit crops that farmers are finishing planting in Brazil and Argentina, the world’s biggest producers after the U.S., World Weather Inc. said. Brazil will export more soybeans than the U.S. for the first time ever this year, the Department of Agriculture said yesterday. China’s imports of the oilseed fell 7.1 percent to 3.81 million metric tons in October, government data show. “There is no compelling story for the bulls right now in soybeans with weather improving crops in South America and China slowing purchases,” Tim Emslie, the research director for Country Hedging Inc. in Inver Grove Heights, Minnesota, said in a telephone interview. “Rains will also aid corn.”

U.S. soy at 1-mth low as European debt crisis deepens
SINGAPORE, Nov 10 (Reuters) - U.S. soy slid to a 1-month low , falling for four out of five sessions, while corn and wheat lost ground as Europe's worsening debt crisis offset the bullish fundamental factor of tight world supplies.
"Given that yesterday's mildly supportive USDA data did not help corn register any gains, the market is likely to take direction from larger economic concerns," said Lynette Tan, an analyst with Phillip Futures in Singapore.

Maize shortage looms in South Africa -paper
JOHANNESBURG, Nov 10 (Reuters) - South Africa will run out of maize as early as next month after the country committed most its harvest for exports, the Business Day newspaper reported on Thursday, quoting Jannie de Villiers, chief executive officer of farmers' group Grain SA.
De Villiers was reiterating what he told Reuters in June that Africa's biggest maize producer would have to import maize by the end of this year because export orders were more than the surplus available.

US corn supply tighter, Chinese imports up-USDA
WASHINGTON, Nov 9 (Reuters) - The U.S. corn supply is tightening, partly due to rising Chinese demand and a cut in yields after a year of tumultuous weather swings, the government forecast on Wednesday.
With the fall harvest in its final stages, the Agriculture Department cuts its estimate of the corn crop by 1 percent, reflecting the lowest nationwide yield since 2003.

Farm body cuts French 2011/12 maize stock estimate
PARIS, Nov 9 (Reuters) - French farm office FranceAgriMer on Wednesday cut by 200,000 tonnes its monthly estimate for the country's maize stocks at the end of the current 2011/12 season to 1.82 million tonnes, now 18 percent down on the 2010/11 stocks.
It predicted a rise of 200,000 tonnes in its forecast for exports outside the European Union at a rare level of 700,000 tonnes and an increase of 200,000 tonnes in demand for animal feed at 3.4 million tonnes, shrugging off its higher crop estimate this month

Zambia exports 496,000 T maize, stocks 1.9 mln T
LUSAKA, Nov 9 (Reuters) - Zambia exported more than 496,000 tonnes of maize to its neighbours from September last year to October this year after a bumper harvest left it with a surplus of 1.6 million tonnes, the Food Reserve Agency (FRA) said on Wednesday.
The maize exports went to Zimbabwe, Democratic Republic of Congo, Kenya, Mozambique, South Africa, Botswana, Burundi and Namibia, the FRA said in a statement.

China's corn import seen at 10 mln T by 2015 -Rabobank
BEIJING, Nov 9 (Reuters) - China, the world's second-largest corn consumer, is likely to import 10 million tonnes of corn a year by 2015 to meet its hog feedmeal demand, a senior manager with Rabobank Nederland said on Wednesday.
The estimate by Pan Chenjun, a senior manager with the bank, was in line with expectations by traders and analysts as China faces shrinking farmland and strains to improve its corn yields to meet its strong domestic demand from livestock breeders.

ICE sugar consolidates, eyes on euro debt crisis
LONDON, Nov 10 (Reuters) - ICE sugar rose in early trade, in line with steadier commodity markets, as the eurozone debt crisis continued to overshadow fundamentals in the softs markets.
ICE raw sugar edged higher in early trade but remained stuck within its recent trading range, with dealers noting technical support had helped keep the market above 25 cents a lb.

US sugar supply outlook up on imports from Mexico
NEW YORK, Nov 9 (Reuters) - The U.S. sugar supply situation for 2011/12 has improved due to higher estimates for imports from Mexico and beginning stocks, the U.S. Agriculture Department said on Wednesday.
USDA forecast sugar imports from Mexico at 1.581 million short tons, almost 37 percent higher than an estimate last month of 1.155 million tons.

Oil Falls in New York, Poised for Longest Weekly Winning Streak Since 2009 (Source: Bloomberg)
Oil fell in New York, while heading for the longest run of weekly gains since April 2009, as concern that Europe’s debt crisis will derail its economy countered signs the U.S. is recovering. Crude for December delivery slid as much as 0.4 percent. It rose 2.1 percent yesterday and is poised for its sixth weekly increase. The number of Americans filing applications for unemployment benefits fell to a seven-month low, a Labor Department report showed. Italy votes today on a package of austerity measures to clear the way for a new government. Futures fell as much as 43 cents to $97.35 a barrel in electronic trading on the New York Mercantile Exchange and were at $97.55 at 8:02 a.m. Singapore time. Oil is up 3.5 percent this week and 6.8 percent this year.

U.S. crude futures rise $1 on stock fall
LONDON, Nov 10 (Reuters) - U.S. crude oil futures  rose by $1 to $96.74 a barrel after an unexpected drop in U.S. crude oil stocks.
Crude stocks in the United States fell 1.37 million barrels to 338.09 million barrels in the week to Nov. 4, the Energy Informational Administration said on Wednesday.

U.S. STOCKS-Index futures signal bounce after selloff
Nov 10 (Reuters) - U.S. stock index futures pointed to a rebound on Wall Street, with futures for the S&P 500  up 1.1 percent, Dow Jones  futures up 0.9 percent and Nasdaq 100  futures up 1 percent at 0947 GMT.
European stocks were up slightly in morning trade after reversing sharp losses in morning trade, with Italian shares rallying on fresh hopes the country will have a new government soon while the European Central Bank was reportedly buying the country's bonds to ease the tensions surrounding its debt pile.

Asia Gasoline/Gasoil-Kenya seeks 50,000T diesel, gasoline for Dec
SINGAPORE, Nov 10 (Reuters) - Kenya is seeking 50,000 tonnes of diesel and gasoline for December, after securing over a total of 250,000 tonnes of the two products for this month and next, trading sources said on Thursday.
The country is seeking 35,000 tonnes of 500 ppm sulphur diesel for delivery over Dec. 11-12 and 15,000 tonnes of gasoline for delivery Dec. 9-10. The tender closes on Nov. 15.

China Oct oil demand up 1.5 pct on yr, Nov seen firmer
BEIJING, Nov 10 (Reuters) - China's implied oil demand grew at one of the slowest paces this year in October, as oil companies raised fuel imports by a modest amount to compensate for trimmed refinery production.
Implied oil demand rose 1.5 percent year-on-year in October, when the world's second largest oil consumer burned about 9.04 million barrels per day (bpd) of oil, slightly more than September's 8.9 million bpd, Reuters calculations based on preliminary trade and output data showed.

Copper Drops to Two-Week Low as European Union Cuts Forecasts for Growth (Source: Bloomberg)
Copper fell to a two-week low as the European Union cut its growth forecast for next year by more than half amid the struggle to contain the debt crisis. Gross domestic product may expand 1.5 percent this year and 0.5 percent in 2012, the European Commission, the EU’s executive arm, said today. That’s down from projected expansion at 1.6 percent and 1.8 percent, respectively. Copper also dropped as China’s exports climbed at the slowest pace in almost two years, signaling cooling growth. “For now, everyone is looking for the next problem,” Dan Smith, an analyst at Standard Chartered Plc in London, said in a telephone interview. “The story for commodities over the medium term and long term is still a good one, but we’re going to see a few more weeks, or maybe months, of continued volatility.”

Gold Traders Most Bullish Since 2004 on Deepening Debt Crisis: Commodities (Source: Bloomberg)
Gold traders and analysts are the most bullish in at least seven years as investors accumulate metal at the fastest pace since August to protect their wealth from a widening European debt crisis. Twenty-one of 22 surveyed by Bloomberg expect bullion to rise on the Comex in New York next week, the third consecutive increase and the highest proportion in data going back to April 2004. Holdings in exchange-traded products backed by gold rose 25.4 metric tons this week, within 1 percent of the record set almost three months ago, data compiled by Bloomberg show.
Gold exceeded $1,800 an ounce for the first time in seven weeks on Nov. 8 and hedge funds are holding their biggest bet on higher prices since mid-September, Commodity Futures Trading Commission data show. The metal is rebounding after tumbling as much as 20 percent in three weeks in September on demand for what are perceived as the safest assets. Almost $9 trillion was wiped off the value of global equities since May and yields on Italian and Greek bonds rose to euro-era records this week.

Gold Falls Most in Three Weeks as Haven Demand Ebbs on Italy, Greece Moves (Source: Bloomberg)
Gold futures fell the most in three weeks as demand for a haven eased after Italian bond yields dropped and a new Greek leader was named, reducing concerns that Europe’s sovereign-debt crisis will escalate. Italy sold 5 billion euros ($6.8 billion) of one-year bills, the maximum for the Treasury auction. Lucas Papademos, a former vice president of the European Central Bank, became the head of a national unity government in Greece. Gold jumped to a record $1,923.70 an ounce on Sept. 6 on demand for an alternative to equities and some currencies. “At least for now, the fear trade has taken a back seat,” Sterling Smith, an analyst at Country Hedging Inc. in St. Paul, Minnesota, said in a telephone interview.

20111111 0946 Soy Oil & Palm Oil Related News.

[Dow Jones] STOCK CALL: A decline in palm oil inventories in October, when the market expected an increase, is positive for crude palm oil prices, Goldman Sachs says. It notes the Malaysian Palm Oil Board reported October palm oil inventories declined 1.6% on-month to 2.1 million tons from their 21-month high. The house notes October production was slightly ahead of its expectations, but it has likely peaked and is likely to decline seasonally until a February trough, with inventories set to head lower in November.

Soybeans (Source: CME)
US soybean futures closed down, dropping to one-month low on concerns about slow export demand and favorable South American crop conditions. The US may have more export competition than normal from a nearly ideal start to Brazil's growing season, analysts say. Despite solid weekly export sales this week, soybean sales are running well below last year, a feature that fails to justify higher prices, analysts add. CBOT Jan soy end down 18c at $11.67 1/2/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures stumbled in unison with soybeans. Soymeal and soyoil slumped on concerns about soybean export demand and outlooks for greater availability of soy supplies for crushing into soy products, analysts say. CBOT Dec soymeal end down $5.20 at 297.90/short ton; Dec soyoil fell 0.47c to 5.52c/lb.

China October Soybean Imports Fall To 7-Month Low (Source: CME)
China's soybean imports in October fell to a seven-month low, as domestic crushers delayed shipments, preferring to wait for global prices to fall further amid sluggish domestic sales, analysts said. Data from the General Administration of Customs showed October exports were 40% lower than the Ministry of Commerce's 6.39 million-metric-ton forecast. The ministry is forecasting November soybean imports of 5.17 million metric tons, based on importers' reports. "Many domestic crushers asked to delay shipments amid a sharp decline in CBOT [Chicago Board of Trade] prices in September," said Tu Xuan, an analyst with agricultural consultancy Shanghai JC Intelligence, noting that many market participants were expecting increased availability of U.S. soybeans, and hence lower prices in the near term. October soybean imports totaled of 3.81 million tons, down 8% from September, but up 2% from a year earlier, the customs data showed.
Imports usually dip in October due to delayed customs clearances as a result of the weeklong National Day holiday at the start of the month. Total imports from January to October fell 5.4% to 41.52 million tons, Customs said. Besides price factors, crushers may have delayed, or even canceled, shipments due to poor domestic sales of feedmeal and soyoil, Zheshang Futures analyst Xu Wenjie said. The government's massive sales of state soybean and edible oil reserves resulted in negative profit margins for crushers over the last nine months and also led to a high inventories of imported soybeans at ports. In the marketing year that ended Sept. 30, China sold 2.1 million tons of edible oil and 2.6 million tons of soybeans from state reserves, the state-backed China National Grain and Oils Information Center has said.

China Oct soy imports fell to 7-month low at 3.81 mln T-Customs
BEIJING, Nov 10 (Reuters) - China, the world's largest soy buyer, imported 3.81 million tonnes of soybeans in October, down 7.7 percent from 4.13 million tonnes in September, figures from the General Administration of Customs of China showed on Thursday.
October imports were the lowest since March and also below  forecasts by analysts and the commerce ministry, which had predicted a level slightly higher than 4 million tonnes. Traders and analysts blamed the lower number on delayed customs clearance.

Brazil to top U.S. in global soybean trade battle
CHICAGO/SAO PAULO, Nov 9 (Reuters) - Brazil will wrest the mantle of world's top soybean exporter from the United States in the coming year, U.S. government data showed on Wednesday, the latest sign of America's slowly diminishing role in global food trade.
Just months after data showed the United States would supply less than half of all corn exports for the first time in 40 years, revised Department of Agriculture forecasts put Brazil as the No. 1 exporter of soybeans for the first time in six years and the second time ever.

Brazil gov sees lower soy, higher corn crop output
SAO PAULO, Nov 9 (Reuters) - Brazil's soybean crop could suffer its biggest annual drop in decades, the government said on Wednesday, the same day the USDA said Brazilian soy exports this season would overtake those from the United States, the long standing leader.
Drawn by the appealing price of corn and faced with potentially irregular weather from La Nina, local soy producers are likely to harvest 71.48 million to 72.96 million tonnes of soy in the 2011/12 crop, down from October's estimate of 72.18-73.29 million tonnes, the agriculture ministry's crop supply agency Conab said.