Wednesday, April 18, 2012

20120418 1816 FCPO EOD Daily Chart Study.

FCPO closed : 3479, changed : -24 points, volume : lower.
Bollinger band reading : correction range bound upside biased.
MACD Histogram : falling lower, buyer reducing exposure.
Support : 3470, 3450, 3420, 3380 level.
Resistance : 3500, 3550, 3620, 3650 level.
Comment :
FCPO closed recorded loss with reduce volume transacted. Soy oil price currently trading lower after overnight edge little higher while crude oil price currently trading little lower.
Fear of slowing down exports pressure price to come down with some partial roll over activities.
Daily chart study still calling a correction range bound upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20120418 1809 FKLI EOD Daily Chart Study.

FKLI closed : 1594 changed : -4 points, volume : lower.
Bollinger band reading : correction range bound upside biased.
MACD Histogram : turned falling, buyer seller battling.
Support : 1590, 1580, 1570, 1565 level.
Resistance : 1595, 1600, 1610, 1620 level.
Comment :
FKLI closed recorded loss with quiet volume changed hand doing 4.5 points discount compare to cash market that closed little higher. Overnight U.S. markets closed higher and today Asia markets ended in positive zone while European markets moving little downward.
Broad markets traded higher after IMF raised global economies forecast and awaits some U.S. corporates earnings report.
Still, FKLI daily technical reading suggesting a correction range bound upside biased market development but seems having difficulties breaking through resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20120418 1740 Regional Markets EOD Daily Chart Study.

 DJIA chart reading : correction range bound little downside biased.
 Hang Seng chart reading : correction range bound little downside biased with MACD crossed up.
KLCI chart reading :  correction range bound upside biased.

20120418 1551 Global Market & Commodities Related News.

Shares buoyed by easing worries over Spanish debt
Asian shares rose as firm demand at Spanish debt sales and positive U.S. corporate earnings boosted investor confidence in riskier assets.

FOREX-Yen falls broadly as risk currencies stage bounce
TOKYO/SYDNEY, April 18 (Reuters) - The yen fell broadly, extending its slip from a seven-week high against the dollar earlier this week, as a revival in risk appetite saw Wall Street score its biggest gains in a month.
Upbeat earnings from U.S. companies such as Coca-Cola , Spain's successful move to raise money in the debt market and an unexpectedly strong reading of German investor confidence all worked to boost market confidence.

GRAINS-Corn near 3-week low on U.S. weather, soy dips
Chicago corn fell for a fourth consecutive session to its lowest in nearly three weeks, weighed down by near-perfect crop weather in the U.S. Midwest which has raised hopes of ample supplies.

UK wheat exports running behind last season
UK wheat exports slowed slightly during February and remain well behind last year's pace despite the shipment of a further cargo to the United States, customs data showed on Tuesday.

Physical Sugar-Indian mills' export incentives decline
Indian sugar mills' incentives to export are diminishing as global prices sink to four-month lows, while most of the government's latest allowed tranche of unrestricted exports have been allocated.

Oil World cuts Argentine, Brazil soy crop estimate
Hamburg-based oilseeds analyst Oil World said on Tuesday it had cut its forecast of Argentina's 2012 soybean crop by 1.0 million tonnes and that of Brazil by 0.5 million tonnes after drought damaged harvests.

OIL-Brent stable at $118 as euro zone concerns ease
Brent crude futures held steady above $118 as concerns on the euro zone crisis eased after a successful Spanish debt auction and a better growth forecast from the International Monetary Fund.

U.S. crude inventories seen rising further due to imports
U.S. commercial crude stockpiles were forecast to have risen last week after data showed the largest three-week build in more than three years due to higher imports, an expanded Reuters poll of analysts showed on Tuesday.  

METALS-Copper surges on South Korea's plan to buy Chinese stocks
Copper rose, led by equities on news that South Korea's central bank will buy $300 million in Chinese stocks over the next three months.

China's lead output, consumption seen strong to Q3
HONG KONG, April 18 (Reuters) - China's production of refined lead is likely to increase until the third-quarter of the year as domestic demand strengthens and smelters use up plentiful local concentrate and imported raw materials, smelter officials and analysts said on Wednesday.
China is the world's top producer and consumer of refined lead, which is predominantly used to make batteries.

China's steel companies lost 1 bln yuan in Q1-CISA
China's steel companies lost about 1 billion yuan ($158.69 million) in the first quarter compared with a profit of 25.8 billion yuan a year ago, an official with the China Iron & Steel Association said on Wednesday.

China's daily crude steel output hit record in early Apr-CISA data
SHANGHAI, April 18 (Reuters) - China's daily crude steel output hit a record of 2.031 million tonnes in the first 10 days of April, up 7.4 percent compared with the last 11 days in March, data from the China Iron & Steel Association (CISA) showed on Wednesday.
This was higher than the previous record of 2.018 million tonnes per day hit in the last 10 days of June last year.

Drops in iron ore output by majors help prop up price
SYDNEY, April 18 (Reuters) - Global miners BHP Billiton , Vale  and Rio Tinto  all posted sharp drops in quarterly iron ore production due to bad weather, a factor that has helped support iron ore prices at relatively high levels despite signs of a softening market.
The falls in output come as competition heats up in global bulk commodities markets due to demand from China for imported industrial raw materials finally showing signs of waning after years of double-digit growth.

Jiangxi sees high China copper stocks as temporary
Jiangxi Copper Co Ltd  , China's top copper producer, said high inventories in China are a temporary issue and will gradually come down, although end users remain cautious and some expect lower prices and are keeping inventories low.  

BHP iron ore, coal mines hit by bad weather, strikes
BHP Billiton on Wednesday posted sharp drops in iron ore and coal production - - for the first quarter of 2012 due to bad weather and labour unrest.

BHP Billiton March quarter iron ore up 14 pct vs yr ago
SYDNEY, April 18 (Reuters) - BHP Billiton  , the world's biggest mining company, posted a 14 percent rise in March-quarter iron ore output versus a year ago and said its guidance for Western Australian ore production was unchanged.  
BHP said production from its Queensland coal mines "remained constrained" as a result of industrial action and heavy rains.

Most U.S. steelmakers see gloomy first quarter
NEW YORK, April 17 (Reuters) - Most U.S. steelmakers will report lower first-quarter earnings and will see little improvement until the construction industry rebounds, analysts said.
Wall Street got a preview of what to expect last month, when Nucor Inc  and Steel Dynamics Inc  each gave a first-quarter profit forecast below estimates, saying they were hit by an unexpected pricing squeeze and lower customer orders. AK Steel  said it expected a first-quarter loss because of weak demand.

Vale's Q1 iron ore output slips to near 70 mln tonnes
SAO PAULO, April 17 (Reuters) - Brazilian miner Vale  produced nearly 70 million tonnes of iron ore in the first quarter, the company said in a securities filing on Tuesday.
That production was down 2.2 percent from 71.5 million tonnes during the first quarter of 2011. Production of iron pellets rose 1.4 percent during the period from a year ago to 12.7 million tonnes.  

Global Copper market to remain tight in 2012 -GFMS
NEW YORK, April 17 (Reuters) - A limited global supply of copper concentrate should keep the market in a production deficit in 2012, supporting prices above current levels even though Chinese demand growth is expected to moderate further this year.
This structural supply-side tightness should limit the downside for copper this year, keeping prices of the industrial metal relatively stable in a range of $8,300 to $8,800 per tonne in 2012, an industry report said on Tuesday. Copper on Tuesday was trading at around $8,050 per tonne.

Italy copper, alloy product output seen down in 2012
MILAN, April 17 (Reuters) - Output of copper and aluminium semi-finished products in Italy, a major European producer, is expected to fall this year as economic crisis and volatile metal prices hit demand, the director of Italy's non-ferrous metals association Assomet said.
"We have a situation of general crisis, which starts with consumption and goes all the way up to production," Claudio De Cani told Reuters in a telephone interview on Tuesday. "High prices are just adding fuel to the fire."

Vale's Q1 iron ore output slips to near 70 mln tonnes
Brazilian miner Vale produced nearly 70 million tonnes of iron ore in the first quarter, the company said in a securities filing on Tuesday.

CESCO-Rio Tinto sees 2nd half copper output up
SANTIAGO, April 17 (Reuters) - Global miner Rio Tinto   sees its copper output rising in the second half of the year as ore grades at its Kennecott Utah copper mine improve, Andrew Harding, the company's head of  copper, said on Tuesday.
Output was hit in the first quarter due to a dip in ore quality at Kennecott, but grades will recover in the second half, Harding told Reuters in an interview at the CRU copper conference in Santiago.

Global Copper market to remain tight in 2012 -GFMS
A limited global supply of copper concentrate should keep the market in a production deficit in 2012, supporting prices above current levels even though Chinese demand growth is expected to moderate further this year.

PRECIOUS-Gold flatlines, fragile euro weighs
Gold traded nearly flat after a successful Spanish debt auction eased fears about the euro zone debt crisis, but the upside is capped as the euro remains under pressure ahead of a longer-term debt sale in Madrid later this week.

Newcrest sees steady 400,000 oz gold output in Indonesia
The gold producer sees steady gold output of 400-450,000 ounces this year from its Gosowong mine in Indonesia, an executive said on Tuesday.

METALS-Copper surges on South Korea's plan to buy Chinese stocks
SHANGHAI, April 18 (Reuters) - Copper rose led by equities on news that South Korea's central bank will buy $300 million in Chinese stocks over the next three months.
Traders say Shanghai copper rose in tandem with the Shanghai Composite index in midmorning trading, leading to plenty of short-covering on the ShFE and copper arbitrage trades on the LME.

PRECIOUS-Gold flatlines, fragile euro weighs
SINGAPORE, April 18 (Reuters) - Gold traded nearly flat after a successful Spanish debt auction eased fears about the euro zone debt crisis, but the upside is capped as the euro remains under pressure ahead of a longer-term debt sale in Madrid later this week.  
Investors brushed off the soft U.S. industrial output and lower-than-expected housing starts data as relief over Spain's finances and a surprise jump in German business sentiment lifted equities and other riskier assets.

20120418 1051 Global Market & Commodities Related News.

GLOBAL MARKETS-Shares rebound as Spain debt worry eases
TOKYO, April 18 (Reuters) - Stabilising risk appetite lifted Asian shares and riskier currencies on Wednesday, after firm demand at Spanish debt sales, positive U.S. corporate earnings, and an improved  sentiment in a Germany survwy boosted investor confidence.
"Risk appetite has come back," said Takashi Hiroki, chief strategist at Monex Inc. "The results of Spanish short-term auction were good. Corporate earnings in the U.S. have met or beat market forecasts."

COMMODITIES-Markets eke out gains as U.S. stocks rise
NEW YORK, April 17 (Reuters) - Commodity markets eked out gains lifted by a buoyant stock market and an easing of euro zone worries after a smooth Spanish bond sale.
The Thomson Reuters-Jefferies CRB Index, a global commodities benchmark, was up 0.54 percent on Tuesday afternoon, snapping two days of losses, but it pared some gains to finish the day 0.43 percent higher.

Obama and the oil speculator bogeyman
--Robert Campbell is a Reuters market analyst. The views expressed are his own--
NEW YORK, April 17 (Reuters) - When a politician trots out the mythical evil speculator as an explanation for why a market is not yielding cheap goods for consumers, you can be almost certain that the real reasons for rising prices are being ignored.
U.S. President Barack Obama's latest attempt to blame speculators for high oil prices smacks of cheap electoral politics and ignores the awkward fact that regulators have hardly turned up much evidence of malicious market manipulation and prosecuted even fewer evil speculators.

OIL- US crude jumps, Brent lags, spread narrows
NEW YORK, April 17 (Reuters) - Brent crude edged up as an upcoming pipeline reversal, aimed at alleviating oversupply in the central United States, bolstered U.S. oil futures at the expense of the higher-priced European benchmark.
"The Spain debt saga is also helping as is the IMF economic growth outlook revision."

US natgas futures sink 3 pct, front hits 10-yr low
NEW YORK, April 17 (Reuters) - U.S. natural gas futures finished sharply lower on Tuesday as forecasts for moderate U.S. weather and an ever growing supply glut sparked selling that knocked the front-month contract to a new 10-year low.
"We're in the (spring) shoulder period, and storage is already jam packed. We've got a big oversupply right now," a New England-based trader said, noting weather demand was fading.

Euro Coal-Prices dip 50c, June ARA trades at $96/T
LONDON, April 17 (Reuters) - European physical coal prices dipped by around 50 cents on Tuesday due to continued oversupply with only one fresh trade reported, utilities and traders said.  
"The trend is for prices to go down but the key is the values achieved by U.S. Illinois high-sulphur coals. These are being sold at extremely competitive prices," said Martin Blomendal, consultant with Energy Edge.

20120418 0945 Malaysia Corporate Related News.

Malaysia imposes ‘no-layoff’ condition for port takeover?
The Federal government is understood to have imposed a condition, with regards to Penang Port SB’s takeover – that any party planning to take over the port operator must not lay off any of its workforce for a minimum period of five years. “The condition is non-negotiable. Any parties which intend to take over the port, must comply with the condition, even before they present their financial plan,” said a source. BT was told that at least two parties are interested in taking over Penang Port. “One is a party led by a China-owned entity, while the other is MMC Corp Bhd. But, to date, no decision has been made as the due diligence process is still being carried out,” said the source. Penang Port is 100% owned by the Minister of Finance Inc. (BT)

Wijaya in talks to start logging in Papua
Wijaya Baru Global clarified yesterday that it is negotiating with interested parties to start timber extraction and thereafter plant oil palm in Papua Province, Indonesia. Tan Sri Ling Chiong Ho’s Sarawak Oil Palms is also reportedly proposing a JV to help plant the felled jungle with oil palm trees, a venture that could eventually cost some RM306m. (Financial Daily)

IGB plans to raise RM700m from retail property trust
IGB Corp, the third largest property developer by market value, plans to raise about RM700m by selling shares in a retail property trust, said two people familiar with the matter. IGB’s trust would initially hold two Kuala Lumpur shopping malls – the Garden’s Mall and Mid Valley Megamall – which IGB would acquire from its subsidiary KrisAssets Holdings. (StarBiz)

Ingens confirms bagging RM125m job
Ingenuity Solutions (Ingens) has obtained a RM125m contract to be the sole distributor of WiMAX modems for broadband player Packet One Networks (M) SB (P1). The company said it would supply P1 4G WiMAX modems to 858 P1 authorized resellers throughout Malaysia. Prior to this agreement, P1 undertook the distribution of its 4G modems internally. (StarBiz)


CIMB Group’s CEO Datuk Seri Nazir Razak said he won’t ask shareholders for money to pay for the acquisition of Royal Bank of Scotland’s business in Asia. “We have calculated that even after the dividend payout for last year, we still have sufficient funds to pay for the acquisitions,” Nazir said. Nazir said he hoped to conclude talks to acquire a stake in Philippines’ Bank of Commerce soon. (The Sun)

The issue price of the new Maybank shares to be issued pursuant to the fourth dividend reinvestment plan applicable to the final cash dividend, has been fixed at RM8 per new Maybank share. The new Maybank shares would be listed on the main market on June 5. (Star Biz)

Local companies should look at the long term by investing in their brands rather than just doing price discounting and promotions, said Nestle Products Sdn Bhd communications director Khoo Kar Khoon. “You should not treat your product as a commodity. “If you continue to just do price discounting, it will hurt your margins and won't benefit either your brand or the product category,” he told StarBiz. With the global economic situation, Nestle is cautious in spending; but Khoo said as a market leader, it would continue to invest in its brands and strengthen its brand equity. “For food products, in a challenging period, we still need to continue our marketing efforts to remind the consumers of the values they can get from our products,” he said. “If you are a market leader and do not do any communications, it will affect the category. Nestle has consistently been among the top advertisers in the country in terms of spending. (Starbiz)

APM Automotive has received the green light from the Indonesian government to set up a subsidiary to manufacture and sell auto parts in the republic. APM said the group will build a manufacturing facility in Suryacipta Industrial City, Kerawang for a total capital and investment outlay of US$10.9m. Operations are targeted to begin in 2Q13. (Financial Daily)

Two companies, Iris Corp and Dibena/Datasonic Corp are said to be the front-runners for the job to replace the identification pages (ID) on the Malaysian passport from paper to polycarbonate. The contract value for just the two ID pages is expected to be about RM330m over a five-year period. The tender is called to change the ID pages as there is a need to add more layers of security to make it difficult for the Malaysian passport to be forged. Some of the other companies that submitted bids included Al Karismi Technologies, Muhlbauer AG, CD Solutions, Kersuma Nyata, Integrity Business Solution and OVD Systems. (Star Biz)

Hua Yang Bhd has acquired the remaining 40% stake it did not own in Sunny Mode Sdn Bhd (SMSB), a property development company, for a cash consideration of RM3m from Nestin Sdn Bhd. SMSB owns 11.5ha of vacant leasehold land near Seremban, Negeri Sembilan. The 99-year lease expires on June 5, 2017. The company is in the process of developing a mixed commercial and industrial project with a gross development value of RM48m to be completed by 2016. (Financial Daily)

Xian Leng Holdings Bhd's office was raided by the police's Commercial Crime Investigation Department after a report was lodged last Friday alleging financial irregularities at the ornamental fish breeder. "We went to check for documents as a report was lodged. We have just started the investigation,", said Bukit Aman Commercial Crime Investigation Department director Datuk Syed Ismail Syed Azizan. He clarified that no arrests were made yesterday. (Financial Daily)

Raja Azmi Adam Nadarajan, the executive director and chief operating officer (COO) of Prestariang has resigned effective yesterday, citing personal reason in the company's filing to the local stock exchange. According to Prestariang, Raja Azmi will be replaced by its senior manager of corporate governance Siti Afiza Ahmad as the acting COO with immediate effect. (Malaysian Reserve)


CIMB: Hopes to complete stake acquisition
CIMB Group Holdings hopes to complete negotiations soon on its proposed acquisition of a stake in the Bank of Commerce belonging to San Miguel Corp, a diversified Philippines conglomerate. "The Philippines is a large market and this makes a good case for us to take the opportunity to enter the market," Group Chief Executive Datuk Seri Nazir Tun Razak said Tuesday after the group's annual general meeting. In line with the group's overseas expansion, Nazir said, the second largest financial services provider was eyeing the South Korea market and expanding into the Asean region which includes Laos, Myanmar and Vietnam. He added that CIMB is going to apply for a new licence in South Korea. (Business Times)

SAM Engineering and Equipment: Temasek to expand investment?
Media reports indicated that Temasek Holdings is likely to extend its investment footprint in Malaysia through the design and manufacture of medical devices. Business Times has learnt that the move is likely to be via Dornier MedTech, which is owned by Temasek's subsidiary Accuron Technologies Ltd. Accuron's investment presence in Malaysia is currently via SAM Engineering and Equipment (M) Bhd (SAM Malaysia) and Aviatron Malaysia Sdn Bhd. Industry sources said that the parent firm is likely to leverage on SAM's engineering design and contract manufacturing capabilities in Malaysia. Sources said that this is logical in the light of recent boardroom changes at Accuron, where SAM's president and CEO Jeffrey Goh has now assumed the position of Accuron's new president and CEO. Goh, when contacted and asked on Accuron's potential expanded presence in Malaysia, said it was too premature to comment. (Business Times)

Leader Universal: Appointed Shandong Licun to operate power plant
Leader Universal Holdings’ wholly-owned subsidiary, Cambodian Energy Ltd, has entered into an operation and maintenance agreement with Shandong Licun Power Plant Technology Co Ltd. Under the agreement, Shandong Licun shall provide services for the operation and maintenance of Cambodian Energy's 100MW coal-fired power plant in Sihanoukville, Cambodia. According to Leader Universal Holdings, the contract is for four years. (Business Times)

Triumphal Associates: Sees 9.7% stake crossed at 60 sen each
Triumphal Associates's 8.47m shares were transacted in an off-market deal at 60 sen per share on Tuesday. According to stock market data, the shares represented a 9.7% stake based on its paid-up of 87.17m shares. However, the transacted price of 60 sen was 30 sen or 33.3% below Monday's closing price of 90 sen. At 4.05pm, Triumphal shares were untraded due to the wide range between the buying bids of 84.5 sen and selling bids of 96 sen. (StarBiz)

Property: Cyberview expects RM3bn investments
Cyberview Sdn Bhd, the landowner and developer of Cyberjaya, expects to attract some RM3bn worth of investment into the global MSC Malaysia Cybercity hub this year. Cyberview MD Hafidz Hashim said it had attracted some RM3.2bn investments from various sectors last year. He said there is a strong interest from multinational companies (MNCs) and local firms to set up their operations as well as global service centres in Cyberjaya. He added that there are have over 620 companies, local and foreign, operating in Cyberjaya. On overall development of Cyberjaya, Hafidz said as of end of last year, physical development of the land available to develop has reached 40%, excluding those which are under construction and planning. He added that if those (under construction and planning) which are expected to be realised within the next two or three years are included, the figure will be hitting 70%. (Business Times)

20120418 0944 Local & Global Economy Related News.

MIER revises upwards growth outlook to 4.2%
The Malaysian Institute of Economic Research (MIER) has revised upwards its growth outlook this year, from 3.7% to 4.2%, on improving consumer and business confidence levels in the first quarter. Executive director Dr Zakariah Abdul Rasheed said improved production and sales numbers are expected to follow suit in the second quarter. (BT)


Economy: MIER says no need for interest rate hike
The continued easing of inflationary pressure amidst elevated oil and commodity prices will not spur policymakers here to adjust the benchmark interest rate up as growth remains the priority. Malaysian Institute of Economic Research (MIER) executive director Dr Zakariah Abdul Rashid said any rate hike by Bank Negara would depend on a surge in prices and that has not happened. (StarBiz)

Economy: MIER says minimum wage won’t cure dependence on foreign labour
MIER says that the minimum wage policy will not resolve  the country’s over-reliance on foreign labour. It said, on the contrary, the policy could prove to be a magnet for foreign labour. It reasoned that should the minimum wage policy exempts foreign workers, employers are likely to turn to foreign workers as they will remain the cheaper alternative to the domestic workforce. On the other hand, if foreign workers are covered by the minimum wage rule, the increased wages will be a strong pull factor that is likely to lure foreign workers to Malaysia. (Financial Daily)


Motor vehicle sales for March 2012 decreased by 9,681 units to 53,583 units from 63,264 in March last year, the Malaysian Automotive Association (MAA) announced. However, it said for the second consecutive month, mom sales volume expanded with sales in March this year to 9,570 units or 21.7% higher than the previous month. The higher sales volume in March was contributed by consumer sentiment, which continued to remain positive, and the introduction of new models and a longer working month. For the first three months of this year, total vehicle sales amounted to 138,544 units, down from 158,432 units in the corresponding period last year. MAA expects the sales trend for April to be similar to March. (Bernama, Financial Daily)

Singapore’s non-oil domestic exports fell unexpectedly in Mar by 4.3% yoy, reversing the revised 30.4% gain in Feb due to an absence of high-value deliveries from its shipyards. Economists expected an 8.2% expansion. Electronics shipments grew 2.8% yoy in Mar (23.3% in Feb), whilst non-electronics shipments fell 7.8%. (Bloomberg, WSJ)


India: Cuts key rates as growth risks trump inflation
India slashed its benchmark interest rate by a greater-than-forecast half a percentage point, seeking to bolster growth with the first reduction since 2009. Inflation might limit the room for further cuts, the central bank said. Governor Duvvuri Subbarao lowered the repurchase rate to 8% from 8.5%, the Reserve Bank of India said. The outcome was predicted by three of 25 economists in a Bloomberg News survey. Seventeen expected a 0.25 percentage-point cut and the rest predicted no change. (Bloomberg)


Japan’s industrial output fell by a revised 1.6% mom in Feb (a revised 0.9% in Jan; 2.3% in Dec 2011) on the back of a slowdown in machinery and auto output. Capacity utilisation contracted 1.7% mom in Feb (+3.4% in the earlier reading). (AFP)

Japan’s sentiment index for general households rose in Mar to 40.3 (a revised 39.9 in Feb; 39.9 in Jan), the highest level since Feb 2011, helped by hopes for support from post-quake reconstruction. (Reuters)

Japan: Will provide USD60bn to expand IMF crisis funding

Japan said it will provide USD60bn to the International Monetary Fund’s effort to expand its resources and shield the global economy against any deepening of Europe’s debt crisis. Finance Minister Jun Azumi unveiled the commitment in speaking to reporters in Tokyo before semiannual meetings of the IMF and World Bank in Washington 20-22 April. Azumi said he hopes for an early agreement among Group of 20 members, who will also gather in Washington, on contributions to the IMF. (Bloomberg)


FDI in China fell 6.1% yoy in Mar to US$11.76bn (-0.9% in Feb), the fifth consecutive month of decline on the back of external and domestic weaknesses. Analysts had expected a 13.6% decrease. In 1Q12, the measure hit US$29.48bn, down 2.8% yoy (+29.4% in 1Q11). (Bloomberg)

Greece raised €1.625bn in three-month debt at 4.20%, a slightly lower rate than during the last comparable operation’s 4.25%, the national debt management agency said, adding that the demand this time was 2.5 times the amount on offer. (AFP)


EU: Euro-area March inflation rate exceeds estimate on energy
European consumer prices increased at a faster pace than initially estimated in March, driven by energy costs, complicating the European Central Bank’s task as it tries to push the inflation rate below its 2% limit. Inflation in the 17-nation euro region held at 2.7% for a fourth month, the European Union’s statistics office in Luxembourg said. That’s higher than the estimate of 2.6% published on 30 March. (Bloomberg)

US: Factories cool for first time in four months
Production at US factories dropped in March for the first time in four months as the industry cooled following the strongest surge in three decades. Manufacturing, which makes up about 75% of industrial output, decreased 0.2% last month as appliance and furniture makers cut back, data from the Federal Reserve showed. The decline followed a revised 3.4% gain from December through February that marked the biggest three-month jump since March 1984. (Bloomberg)

US industrial production experienced no change on a mom basis in Mar, same with Feb but less than the 0.3% consensus estimate. Capacity utilisation came off slightly to 78.6% from a revised 78.7% in Feb, matching consensus. Manufacturing declined 0.2% from a revised 0.8% in Feb, worse than consensus of a 0.3% gain. (Bloomberg)
US: Housing starts in US unexpectedly fall to five-month low
Builders began work on fewer homes than forecast in March, signalling a sustained industry recovery will take time to get underway. Housing starts dropped 5.8% to a 654,000 annual rate, less than the lowest estimate of economists surveyed by Bloomberg News and the least since October, Commerce Department figures showed. The slump was led by the volatile multifamily category, which at the same time showed a jump in permits, a proxy for future construction. (Bloomberg)

IMF Raises Global Forecast for First Time Since Early 2011
The International Monetary Fund raised its global growth forecast for the first time in more than a year, with the US boosting the outlook while recent improvements remain “very fragile.” The world economy will expand 3.5% this year, compared with a January projection of 3.3%, the Washington-based IMF said in its World Economic Outlook. It sees growth of 4.1% in 2013, up from 4.0%. It raised its forecasts for the US to gains of 2.1% this year and 2.4% in 2013. (Bloomberg)

US stocks post biggest rally in one month amid global optimism
US stocks rose, giving benchmark indexes the biggest rallies in a month, as higher forecasts from the International Monetary Fund and gains in Spanish bonds overshadowed declines in housing starts and factory production. The Standard & Poor’s 500 Index rose 1.6% to 1,390.78, after falling 1.3% in two days. The Dow Jones Industrial Average added 194.13 pts, or 1.5%, to 13,115.54. The Nasdaq Composite Index climbed 1.8% to 3,042.82. About 6bn shares changed hands on US exchanges, or 11% below the three-month average. (Bloomberg)

20120418 0942 Global Market Related News.

Asia Stocks Rise as IMF Outlook, Spain Debt Ease Concerns (Source: Bloomberg)
Asian stocks rose, with the regional benchmark headed for its biggest gain in three weeks, after the International Monetary Fund raised economic forecasts and Spain sold more debt than targeted, boosting the earnings outlook for exporters. Toyota Motor Corp. (7203), Asia’s biggest carmaker by market value, gained 2.6 percent in Tokyo. Canon Inc. (7751), a Japanese camera maker that gets almost a third of its sales from Europe, increased 2.4 percent. BHP Billiton Ltd. (BHP), the world’s largest mining company and Australia’s No. 1 oil producer, advanced 1.4 percent after commodity prices gained. China Overseas Land & Investment Ltd. may be active today in Hong Kong after the developer’s sales surged in the first quarter.
The MSCI Asia Pacific Index (MXAP) gained 0.9 percent to 124.75 as of 9:24 a.m. in Tokyo before the opening of markets in Hong Kong and China. More than 17 stocks rose for each that fell, with the gauge headed for its biggest gain since March 27. Japan’s Nikkei 225 Stock Average increased 1.5 percent, with trading volume 32 percent below the 30-day average. Australia’s S&P/ASX 200 Index gained 1.2 percent. “The environment for equities is pretty good,” said Donald Williams, chief investment officer at Platypus Asset Management Ltd. in Sydney, which manages about $1 billion. “Even though 2012 is going to be a tough year because most of Europe will be in recession for a large part of this calendar year, you are still looking at a global growth rate of 3.5 percent, which is a pretty decent growth rate.”

Japan Stocks Rise on IMF Forecast, Spanish Bonds (Source: Bloomberg)
April 18 (Bloomberg) -- Japanese shares rose, with the Nikkei 225 (NKY) Stock Average heading for its biggest advance in three weeks, after the International Monetary Fund raised its global economic forecast and Spain sold more debt than its target, boosting the earnings outlook for Japanese exporters. Sony Corp., a consumer electronics company that gets a fifth of its sales in Europe, added 1.7 percent. Sumitomo Mitsui Financial Group Inc. (8316), Japan’s second-biggest lender by market value, rose 2.6 percent. Inpex Corp. (1662), the nation’s No. 1 energy explorer, advanced 1.6 percent on rising crude prices. The Nikkei 225 gained 1.6 percent to 9,618.33 as of 9:11 a.m. in Tokyo, heading for its biggest gain since March 27, with all but four stocks gaining. The broader Topix Index added 1.7 percent to 817.03 with all 33 of the gauge’s industry groups advancing.
“The environment for equities is pretty good,” said Donald Williams, chief investment officer at Platypus Asset Management Ltd. in Sydney, which manages about $1 billion. “Even though 2012 is going to be a tough year because most of Europe will be in recession for a large part of this calendar year, you are still looking at a global growth rate of 3.5 percent, which is a pretty decent.”

U.S. Stocks Post Biggest Rally in 1 Month as Apple Surges (Source: Bloomberg)
U.S. stocks rose, giving benchmark indexes the biggest rallies in a month, as higher forecasts from the International Monetary Fund and gains in Spanish bonds overshadowed declines in housing starts and factory production. Apple Inc. (AAPL), the most valuable technology company, surged 5.1 percent after yesterday capping its longest losing streak since October. Bank of America Corp. and Citigroup Inc. (C) added more than 1.4 percent as European lenders jumped after Spain sold more debt than targeted. Coca-Cola Co. (KO), rose 2.1 percent as earnings beat estimates. International Business Machines Corp. and Intel Corp. (INTC), which gained in anticipation of their results, slumped at least 2.4 percent in extended trading.
The Standard & Poor’s 500 Index rose 1.6 percent to 1,390.78 at 4 p.m. New York time, after falling 1.3 percent in two days. The Dow Jones Industrial Average added 194.13 points, or 1.5 percent, to 13,115.54. The Nasdaq Composite Index climbed 1.8 percent to 3,042.82. About 6 billion shares changed hands on U.S. exchanges, or 11 percent below the three-month average. “The market was able to shrug off disappointing U.S. economic reports,” said Paul Zemsky, the New York-based head of asset allocation for ING Investment Management. His firm oversees $160 billion. “We’ve got data showing the German economy is growing strong, positive earnings surprises in the U.S. and some good news out of Spain. There’s a lot of room for positive surprises given how pessimistic things were.”

European Stocks Climb Most Since December on Spain Debt (Source: Bloomberg)
European stocks rallied the most this year as demand increased at a Spanish debt sale, German investor confidence topped forecasts and the International Monetary Fund boosted its global growth outlook. Banks contributed the most to the Stoxx Europe 600 Index’s advance as Banco Popolare SC (BP) and Barclays Plc (BARC) climbed. Danone rose 2.9 percent as the world’s biggest yogurt maker reported higher first-quarter sales. Repsol YPF SA (REP) plunged 6.1 percent as Argentina took control of the Spanish company’s YPF unit following a dispute over slumping oil output and investments.
The Stoxx 600 gained 2 percent to 259.45 at the close of trading, the biggest jump since Dec. 20. The benchmark index has climbed 6.1 percent this year as the European Central Bank flooded financial markets with 1 trillion euros ($1.3 trillion) of cheap loans for three years to ease credit. ECB Governing Council member Ewald Nowotny said late yesterday that he doesn’t see an “immediate need” for an extension of the measures, known as the longer-term refinancing operation, or LTRO. “The Spanish debt auction today shows there is still liquidity in the market,” said Witold Bahrke, a senior strategist at PFA Pension A/S in Copenhagen, where he helps oversee $55 billion. “We’ve cleared some smaller tests on sentiment surrounding the euro area ahead of the real tests late in the week when France and Spain sells debt maturing later than the LTRO’s.”

GLOBAL MARKETS-Spanish debt costs pressure euro
LONDON, April 17 (Reuters) - The euro lost ground slightly and German government bond prices edged away from record highs on Tuesday as investors waited to see if concerns over Spain's budget deficit and banking sector push up borrowing costs at a debt sale.  
"Concern over the situation in Spain, with the bill auction today and the problems with the economy and debt remaining a key focus, will keep the euro under pressure," Niels Christensen, currency strategist at Nordea in Copenhagen said.

Stocks, Commodities Gain on Spanish Debt Auction, IMF (Source: Bloomberg)
Stocks surged and Treasuries fell as Spain sold more debt than targeted and the International Monetary Fund raised economic forecasts, overshadowing declines in U.S. housing starts and factory production. Commodities rose. The Standard & Poor’s 500 Index added 1.6 percent to close at 1,390.78 at 4 p.m. in New York, its biggest gain in a month, and the Stoxx Europe (SXXP) 600 Index rallied 2 percent for its best advance of 2012. Yields on Spanish 10-year bonds fell 18 basis points to 5.89 percent and the Italian yield lost 12 basis points. Ten-year Treasury yields increased two basis points to 2.00 percent. Canada’s currency strengthened against 15 of 16 major peers as policy makers said they may boost interest rates. Oil helped lead gains in commodities.
The IMF increased its outlook for global growth in 2012 to 3.5 percent from 3.3 percent and lifted its forecast for the U.S. expansion to 2.1 percent from 1.8 percent, easing concern that Europe’s debt crisis will stifle the recovery. Spain sold 12-month and 18-month bills a day after yields on its 10-year bonds reached the highest level this year. German’s ZEW survey of investor confidence unexpectedly rose to a two-year high. “It’s a collection of things that have ignited investors’ animal spirits again,” Mark Luschini, chief investment strategist for Philadelphia-based Janney Montgomery Scott LLC, which manages about $54 billion, said in a telephone interview. “We’ve had the IMF upgrade of global activity, good news out of Europe and decent earnings reports so far. That’s boosting confidence.”

IMF Raises Global Forecast for First Time Since Early 2011 (Source: Bloomberg)
The International Monetary Fund raised its global growth forecast for the first time in more than a year, with the U.S. boosting the outlook while recent improvements remain “very fragile.” The world economy will expand 3.5 percent this year, compared with a January projection of 3.3 percent, the Washington-based IMF said today in its World Economic Outlook. It sees growth of 4.1 percent in 2013, up from 4.0 percent. It raised its forecasts for the U.S. to gains of 2.1 percent this year and 2.4 percent in 2013. The report reflects the IMF’s view that the euro area, while still facing an economic downturn and the “hard to quantify” potential risk of a country’s default, has stabilized since last year. The euro area economy is projected to decline by 0.3 percent in 2012, an improvement from the 0.5 percent in the IMF’s previous forecast. China is projected to grow 8.2 percent and Japan 2 percent this year.
“For the last six months the world economy has been on what is best described as a roller-coaster,” IMF chief economist Olivier Blanchard said at a briefing in Washington today. After European governments took measures to reassure markets, “an uneasy calm remains. One has the feeling that at any moment things could well get very bad again.”

Better IMF Outlook Boosts Equities After Slump: China Overnight (Source: Bloomberg)
Chinese equities traded in the U.S. rose for the first time in three days, defying stock declines in Shanghai and Hong Kong, after the International Monetary Fund boosted its forecast for global economic growth. The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S. climbed 1.2 percent yesterday to 102.80. The Shanghai Composite Index and Hang Seng China Enterprises Index (HSCEI) declined for a second day, after data showing foreign investment in China slipped for a fifth month. New Oriental Education & Technology Group (EDU) Inc. jumped the most in a month while Trina Solar Ltd. (TSL) led gains in solar companies. China Unicom (Hong Kong) Ltd. traded at its widest premium over Hong Kong in two weeks.
The world economy will expand 3.5 percent this year and 4.1 percent in 2013, up from January projections of 3.3 percent and 4 percent, as the euro region stabilizes and the U.S. outlook improves, the IMF said yesterday. The Washington-based lender maintained a forecast of 8.2 percent growth for China, where policy makers last month cut their 2012 own target to 7.5 percent, the lowest level since 2004. China is the world’s largest exporter. “The implication here is that the global economy is doing better and therefore export numbers out of China will be better,” Elena Ogram, who manages $50 million in emerging market assets, including Chinese stocks, at Bank am Bellevue AG in Zurich, said by phone yesterday. A better global outlook is “positive for China’s economic growth and for Chinese equities,” she said.

FOREX-Euro vulnerable ahead of Spanish bill auction
LONDON, April 17 (Reuters) - The euro was steady on Tuesday, staying vulnerable ahead of a Spanish bill sale that could intensify concerns over the country's precarious fiscal position as euro zone debt jitters showed no signs of abating.
"I think we'll see a test of $1.30 within the next week. Concern over the situation in Spain, with the bill auction today and the problems with the economy and debt remaining a key focus, will keep the euro under pressure," said Niels Christensen, currency strategist at Nordea in Copenhagen.

Yen Falls Versus Peers on Stock Gain, Before Jobs Report (Source: Bloomberg)
The yen fell against all of its major peers as Asian stocks extended a global rally and before U.S. data that may show fewer Americans filed for jobless benefits, reducing demand for safer assets. Japan’s currency retreated from a six-week high versus the dollar after the Nikkei newspaper said the Bank of Japan (8301) may raise its inflation forecasts, fanning speculation the central bank will add to monetary easing to achieve its price target. The euro was 0.4 percent from a 19-month low against the pound before Spain sells bonds tomorrow. “On balance, you would still say conditions in Asia and the U.S. will sustain global growth activity at a reasonable level and prevent Europe from dragging the global economy into a severe downturn,” said Greg Gibbs, a currency strategist at Royal Bank of Scotland Group Plc in Sydney. “We’ll see some strength in a range of currencies against the yen.”
The yen fell 0.3 percent to 81.10 per dollar at 9:29 a.m. in Tokyo from yesterday. It reached 80.30 on April 16, the strongest since Feb. 29. Japan’s currency lost 0.4 percent to 106.48 per euro. The 17-nation euro was little changed at 82.40 pence after touching 82.10 on April 16, the lowest since September 2010. The euro was unchanged at $1.3127.

Korean Won Climbs, Bonds Fall on IMF Forecast, Spain Auctions (Source: Bloomberg)
South Korea’s won gained for the first time in three days and bonds slid as the International Monetary Fund raised its global economic growth forecast and Spain sold more debt than targeted. The IMF predicted growth of 3.5 percent this year in its World Economic Outlook yesterday, compared with a January projection of 3.3 percent. It sees growth of 4.1 percent in 2013, up from 4 percent. Spain sold 3.18 billion euros ($4.2 billion) of debt yesterday, compared with the Treasury’s maximum target of 3 billion euros. The Kospi (KOSPI) Index of shares rallied, following a 1.6 percent advance in the Standard & Poor’s 500 Index yesterday. “Global stock gains following the revised economic forecast and Spain’s debt auctions will support the won at the mid-1,130 level,” said Lee Yong Hee, a Seoul-based currency dealer at the Industrial Bank of Korea. “Overseas investors repatriating dividends paid out by South Korean companies may limit won gains.”
The won strengthened 0.5 percent to 1,134.88 per dollar as of 9:12 a.m. in Seoul, according to data compiled by Bloomberg. One-month implied volatility for the won, a measure of exchange- rate swings used to price options, slid 23 basis points, or 0.23 percentage point, to 8.45 percent.

U.S. Housing Starts Unexpectedly Drop to Five-Month Low (Source: Bloomberg)
Builders began work on fewer homes than forecast in March, signaling a sustained industry recovery will take time to get underway. Housing starts dropped 5.8 percent to a 654,000 annual rate, less than the lowest estimate of economists surveyed by Bloomberg News and the least since October, Commerce Department figures showed today in Washington. The slump was led by the volatile multifamily category, which at the same time showed a jump in permits, a proxy for future construction. While warmer weather may have spurred home construction at the beginning of 2012, a competing supply of cheap existing properties may be steering potential buyers away from purchasing a new home. That means home construction may not help boost the economy in 2012.
“Housing continues to bump along the bottom,” said Jacob Oubina, a senior U.S. economist at RBC Capital Markets LLC in New York. “The best we can hope from housing over the next couple years is that it won’t subtract from growth. The numbers in the past few months were decidedly impacted by a much milder winter, so a significant portion of construction was pulled forward.”

U.S. Factories Cool for First Time in Four Months: Economy (Source: Bloomberg)
Production at U.S. factories dropped in March for the first time in four months as the industry cooled following the strongest surge in three decades. Manufacturing, which makes up about 75 percent of industrial output, decreased 0.2 percent last month as appliance and furniture makers cut back, data from the Federal Reserve showed today in Washington. The decline followed a revised 3.4 percent gain from December through February that marked the biggest three-month jump since March 1984. The rebound in manufacturing that helped the world’s largest economy climb out of the recession in June 2009 may now be giving way to gains among service industries, including retailers, as consumer spending grows. Another report showed builders broke ground on fewer houses than forecast last month, a sign residential real estate continues to lag behind.
“We’ve had a very strong run -- manufacturing just sort of plateaued a little bit here in March,” said Omair Sharif, a U.S. economist at RBS Securities Inc. in Stamford, Connecticut, who is the most-accurate forecaster of industrial production for the two years ended February, according to data compiled by Bloomberg. “The services sector has begun to take off and is more of the leader, but manufacturing is continuing to contribute.”

Jobs Data Simultaneous Release Jeopardized by U.S. Curbs (Source: Bloomberg)
The U.S. Department of Labor said it can’t assure news organizations they will be able to transmit market-sensitive economic data at exactly the same moment under changes resulting from the first review of procedures in a decade. The agency ordered journalists to remove computer hardware, software and communications lines they currently have installed at the department to transmit news on data such as the jobless rate and consumer prices. Instead, reporters will have to use equipment, software and Internet connections provided by the government. “I’m not going to guarantee anything,” Carl A. Fillichio, the department’s senior adviser for communications and public affairs in Washington, said on a conference call when asked if every news organization will be assured a connection to the Internet “at exactly the same millisecond.”
Under the current system, credentialed journalists in so- called lockups are given data in advance of their release to the public, allowing time to prepare stories, headlines and tables. Communication by phone or computer is cut off for the half hour that reporters are typically given to write their stories. A Department of Labor employee then flips a switch that opens telephone and data lines, allowing journalists to transmit their stories using their own equipment.

U.S. Homebuilding Probably Rose, Capping Best Quarter Since 2008 (Source: Bloomberg)
Homebuilding in the U.S. probably climbed in March, marking the best quarter since 2008 and indicating the real-estate industry has steadied, economists said before a report today. Housing starts increased to a 705,000 annual rate last month from a 698,000 pace in February, according to the median estimate of 82 economists surveyed by Bloomberg News. Starts probably averaged 703,000 in the first three months of 2012, the most since the third quarter of 2008. Warmer weather alongside historically-low lending costs and faster job creation may have spurred more home construction at the beginning of 2012. While the number of single-family housing starts last year was the lowest on record, work on multifamily units is providing homebuilders with new business.
“Housing starts are starting to see stabilization,” said Anika Khan, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “The numbers are still coming from a very low base, but there’s improvement. We’re also still contending with a lot of the effects from weather.”

Treasuries Snap Gain on Speculation Retail Sales Rose (Source: Bloomberg)
Treasuries stayed lower after falling yesterday as economists said government and industry reports will show initial claims for jobless insurance declined and sales of existing homes rose. Treasuries have handed investors a loss of 0.1 percent this year, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. The MSCI All-Country World Index (MXWD) of stocks returned 10 percent including reinvested dividends. “As long as the labor market is healthy, I’m not worried about the U.S. economy,” said Tsutomu Komiya, who helps oversee the equivalent of $111 billion as an investor in Tokyo at Daiwa Asset Management Co., a unit of Japan’s second-biggest brokerage. “Yields will rise” in the months ahead. Benchmark 10-year notes yielded 2 percent as of 9:34 a.m. in Tokyo, according to Bloomberg Bond Trader prices. The 2 percent security due in February 2022 changed hands at 99 30/32.
The rate increased two basis points, or 0.02 percentage point, yesterday. It has risen from the record low of 1.67 percent set Sept. 23 and is still less than the average of 3.84 percent for the past decade.

Japan Will Provide $60 Billion to Expand IMF’s Resources (Source: Bloomberg)
Japan said it will provide $60 billion to the International Monetary Fund’s effort to expand its resources and shield the global economy against any deepening of Europe’s debt crisis. Finance Minister Jun Azumi unveiled the commitment in speaking to reporters in Tokyo today before semiannual meetings of the IMF and World Bank in Washington April 20-22. Azumi said he hopes for an early agreement among Group of 20 members, who will also gather in Washington, on contributions to the IMF. Japan, the world’s third-largest economy, becomes the largest donor yet outside of Europe to IMF Managing Director Christine Lagarde’s campaign to bolster the fund’s resources for the second time in three years. Azumi said that the stance of China, the world’s largest holder of foreign-exchange reserves, is in the same direction as Japan’s and that he hopes Japan’s pledge will accelerate the commitments of others.
“It’s in everyone’s best interest that Europe gets back on its feet as soon as possible,” said Matthew Circosta, an economist at Moody’s Analytics in Sydney. The announcement may “add stability to financial markets that had been weakening over the last few weeks as the crisis flared up again, particularly in Spain.”

Japan Poised for Era of Sustainable Inflation, Nomura Say (Source: Bloomberg)
Japan is poised to exit more than a decade of deflation as a strengthening yuan bolsters China’s buying power, fueling Japanese production and buoying prices, according to Nomura Holdings Inc. Demand from China will propel continuous gains in Japanese consumer prices next year as companies ramp up production with factories now running at about three quarters of capacity, Takahide Kiuchi, Nomura’s chief economist, said in an interview on April 13. The yuan has gained 5.2 percent against the yen this year, making Japanese products more affordable in China, which became Japan’s biggest overseas market in 2009.
Premier Wen Jiabao last month said China will adopt policies to encourage domestic consumption and wean the country from its dependence on exports. The shift may help Japan absorb a glut of unused factory capacity and unwind a cycle of declining prices that has weighed on economic growth. Deflation has driven wages down 16 percent since a 1997 peak and caused tax revenues to fall by about 20 percent in the same period, according to government data compiled by Bloomberg. “Even mild deflation is a bad thing,” Kiuchi said. “When people expect deflation, wages tend to decline more rapidly. That means real wages decline and that undermines consumption."

India Cuts Key Rate for First Time Since 2009 (Source: Bloomberg)
India slashed its benchmark interest rate by a greater-than-forecast half a percentage point, seeking to bolster growth with the first reduction since 2009. Inflation might limit the room for further cuts, the central bank said. Governor Duvvuri Subbarao lowered the repurchase rate to 8 percent from 8.5 percent, the Reserve Bank of India said in a statement in Mumbai today. The outcome was predicted by three of 25 economists in a Bloomberg News survey. Seventeen expected a 0.25 percentage-point cut and the rest predicted no change. The move stoked gains in the rupee and government bonds, and may buttress demand in an economy hampered by political gridlock that’s restraining investment. Policy makers are seeking at the same time to contain inflation that remains the fastest among the BRIC nations.
“They are playing with fire,” said Jahangir Aziz, an economist at JPMorgan Chase & Co. in Washington who used to work at the International Monetary Fund. “I am increasingly assured that this is going to be last rate cut” given the risks to inflation from oil prices and loose fiscal policy, he said.

Indonesia Raises $2.5 Billion in Second Overseas Sale This Year (Source: Bloomberg)
Indonesia raised $2.5 billion from sales of 10- and 30-year dollar bonds, tapping global investors to spur economic growth for the second time this year after winning investment-grade ratings. The government sold $2 billion of debt due in April 2022 yesterday to yield 3.85 percent, or 184 basis points more than that for similar-maturity U.S. Treasuries, according to data compiled by Bloomberg. It also issued $500 million more of 5.25 percent bonds due 2042 at a yield of 4.95 percent, 181 basis points more than U.S. debt. The government of Southeast Asia’s largest economy is taking advantage of relative borrowing costs close to an eight- month low as it plans to spend $53 billion until 2020 to build railways, airports and seaports. Emerging-market debt sales climbed 31 percent to $331 billion this year, showing demand for those bonds even as Europe’s debt crisis worsened.
“This is a good time to issue given the global low interest rates and strong demand for emerging-market bonds,” Chia Tse Chern, the Singapore-based co-head of Asian fixed- income at UOB Asset Management, which oversees the equivalent of $15 billion of assets, said before the sale. “Demand will be strong from the U.S. and Europe because of Indonesia’s investment-grade status.”

Euro-Area March Inflation Rate Exceeds Estimate on Energy (Source: Bloomberg)
European consumer prices increased at a faster pace than initially estimated in March, driven by energy costs, complicating the European Central Bank’s task as it tries to push the inflation rate below its 2 percent limit. Inflation in the 17-nation euro region held at 2.7 percent for a fourth month, the European Union’s statistics office in Luxembourg said in an e-mailed statement today. That’s higher than the estimate of 2.6 percent published on March 30. The economy may struggle to gather strength as budget cuts and rising energy prices erode consumer spending and company investment. European Central Bank President Mario Draghi on April 4 quashed talk of an early exit from emergency stimulus measures as Spain struggled to borrow in financial markets. Policy makers left the benchmark rate at a record low 1 percent.
“Inflation remains relatively high on the back of one-off factors,” said Annalisa Piazza, a fixed-income analyst at London-based Newedge Group. “However, the ECB has clearly signaled that policymakers are ready to act in a timely manner, should pass-through effects start to put upside risks to medium term inflation.”

Euro-Region Weakness Tests Maersk Competition Armistice: Freight (Source: Bloomberg)
Europe’s container-shipping operators need a pause in the slowdown afflicting the region to bolster the truce they’ve called in their fight for customers. Economic weakness caused by the debt crisis in Europe, which accounts for more than a third of global trade, is putting pressure on earnings at companies including A.P. Moeller-Maersk A/S, the world’s largest container line. Operators have shored up margins by raising charges after a price war last year, and Maersk plans to implement a further increase next month. While European Central Bank President Mario Draghi says the euro-area economy is showing signs of stabilization “at a low level,” the ECB itself predicts a contraction in the region this year. Analyst Rikard Vabo at Fearnley Fonds ASA in Oslo suggested shipping lines will struggle to stave off the effects of austerity and two years of debt-fueled turmoil.
“Maersk made a U-turn and started focusing more on the profitability and rates again, which basically saved the industry,” Vabo said in a phone interview. “For these rates to stick and for operators to keep the utilization level required on their ships, you will need to see an uptick on demand in the U.S. and Europe, and the outlook for Europe isn’t very encouraging.” He has a reduce recommendation on Maersk stock.

Spain’s Surging Bad Loans Cast New Doubts on Bank Cleanup Plan (Source: Bloomberg)
Spain’s surging bad loans are spurring doubt on whether the government can persuade investors that it can clean up the country’s banks without further damaging public finances. Non-performing loans as a proportion of total lending jumped to 7.91 percent in January, the highest level since 1994, from less than 1 percent in 2007, according to Bank of Spain data. The regulator is set to publish data for February today. Defaults are rising and credit is shrinking at a record pace as 24 percent unemployment corrodes the quality of loans built up in the country’s credit boom and saps the appetite of banks to make new ones. Doubts about the extent of Spain’s non- performing loans problem is hurting bank stocks and driving up the government’s borrowing costs on investor concern that the expense of propping up ailing lenders may add to the debt burden.
“One of our concerns in Spain is to what extent contingent liabilities could pass to the central government,” said Andrew Bosomworth, Pacific Investment Management Co.’s Munich-based head of portfolio management. Non-performing loans “will have to rise when you take into account the unemployment rate and what’s happening with the economy,” he said.

20120418 0942 Global Commodities Related News.

Recap: Wheat Futures (Source: CME)
Wheat futures softened into the close to finish narrowly mixed in Chicago; around a penny higher in Kansas City and weaker in Minneapolis. After enjoying slight to moderate gains most of the trading session, wheat futures faced pressure into the close as traders lightened their long holdings and booked profits.

Wheat Market Recap Report  (Source: CME)
May Wheat finished down 3/4 at 615 1/2, 11 1/2 off the high and 1/2 up from the low. July Wheat closed down 1 at 620 1/4. This was 1/2 up from the low and 11 3/4 off the high. May wheat gave back all of the early small gains to close down on the day and well off of the early peak. The market was trading moderately higher on the day into the mid-session but saw choppy to lower trade for much of the day and pushed to new lows for the day late. The more bullish tilt to outside market forces this morning plus talk of the oversold condition of the market helped to spark some early buying. Talk of weekend cold weather in the eastern Corn Belt helped to provide some support as the crop is advancing and could be more vulnerable to colder weather. The weekly crop progress and condition reports will be released after the close. Morocco officials indicated that they had at least 3-months of domestic needs covered with current wheat stocks. Milling wheat futures in Paris jumped more than 1% which helped to provide some support. However, speculative selling was active late in the day. May Oats closed down 2 1/4 at 320 3/4. This was 2 1/4 up from the low and 3 3/4 off the high.

Corn Market Recap for 4/17/2012  (Source: CME)
May Corn finished down 6 1/2 at 616 3/4, 11 1/4 off the high and 1 up from the low. July Corn closed down 6 at 607 1/4. This was 3/4 up from the low and 10 3/4 off the high. May corn pushed moderately higher on the day early in the session with the other grains but long liquidation selling emerged to drive the market moderately lower on the day into the close to push to the lowest level since March 30th and to the lowest close since March 29th which was ahead of the acreage and stocks reports. The market saw some early buying support from overflow buying from the other grains but futures drifted back to just slightly higher on the day into the mid-session. Traders see planting progress as of Sunday to come in near 17% complete as compared with 7% last week for the delayed weekly update for release after the close. Weekly export inspections were released after the close yesterday and came in better than expected. The surge in the US stock market and higher energy markets were seen as positive forces. Traders see the weather as a mostly negative force as the Midwest dries up from the hefty rain totals this weekend. Only light showers are seen into the weekend and traders see very active plantings again early next week. May corn is now down as much as 48 1/2 cents off of last week's highs. May Rice finished up 0.14 at 15.57, 0.03 off the high and 0.1 up from the low.

GRAINS-Wheat, corn rise from 2-week low, soy up on demand
SINGAPORE, April 17 (Reuters) - Chicago wheat rose 0.7 percent as the market recovered from a two-week low on concerns over a freeze in the U.S. Plains threatening the winter crop, while corn edged higher on strong demand.
"We had export inspection figures which were released after the market closed last night and they were pretty supportive for corn," said Victor Thianpiriya, an agricultural commodity strategist at ANZ.

Kazakhstan lowers 2011-12 grain export forecast
ASTANA, April 17 (Reuters) - Kazakhstan expects grain exports in the current marketing year to reach between 11 million and 12 million tonnes, lower than previously forecast, an Agriculture Ministry official said on Tuesday.
The Central Asian country had exported 8.4 million tonnes of grain between July 1, the start of the current marketing year, and April 1, Anna Buts, director of the ministry's land development and phytosanitary department, told reporters.

Shift to soy frees up in-demand US corn seed
CHICAGO, April 16 (Reuters) - Minnesota farmer Dave Eiynck was surprised last week when his seed dealer called to say he had obtained a particular kind of corn seed.
It was unusual, as the dealer had previously warned he was unable to fill nearly a third of Eiynck's order for a certain seed variety to cover about 1,320 acres (535 hectares) due to short supplies.

POLL-Rains slow record pace of U.S. corn planting
CHICAGO, April 16 (Reuters) - U.S. corn farmers came off their record planting pace last week as heavy rain over the weekend in key growing areas of the Midwest caused the first delays of the spring, analysts said.
A Reuters poll of 16 analysts pegged corn planting at 17 percent complete as of April 15, up from 7 percent a week earlier.

Fire closes USDA, delays Crop Progress report
WASHINGTON, April 16 (Reuters) - An overnight fire forced the closure of the U.S. Agriculture Department complex on the National Mall and disrupted the flow of data to commodity markets, including a closely watched report on U.S. crop development, officials said on Monday.
The weekly crop progress report, ordinarily released on Monday afternoon, was rescheduled because of the blaze, which fire fighters put out. The report will now be released Tuesday at 4 p.m. EDT (2000 GMT).

Argentina strikes Bunge from grains registry again
BUENOS AIRES, April 16 (Reuters) - Argentina has suspended giant agribusiness company Bunge Ltd  from a key government grains registry, citing a tax probe, the government's AFIP tax agency said in a statement on Monday.
The announcement marked the second time the trading company has been suspended from the list over the last 13 months due to the investigation.

SOFTS-Arabica coffee near 18-month low, sugar steady
LONDON, April 17 (Reuters) - Arabica coffee futures hovered near an 18-month low on Tuesday, under pressure from ample supplies, as top producer Brazil's harvest approached.  Harvest in top producer Brazil is due to begin in around a month and dealers expect a large but sub-record crop.  

Vietnam Q1 coffee exports to Indonesia soar-customs
HANOI/SINGAPORE, April 17 (Reuters) - Vietnam's coffee exports to Indonesia soared nearly eight-fold to 26,900 tonnes or 448,300 bags in the first three months of 2012, Vietnam Customs said on Tuesday, as roasters in the rival producer struggled with tight supplies and high prices.
The two Southeast Asian countries compete in the robusta market, but Indonesian roasters have been forced to chase beans from Vietnam for a second year in a row.

Peru yearly coffee output to fall 15 pct - growers
LIMA, April 16 (Reuters) - Peru's coffee production is expected to fall by around 15 percent this year due to heavy rains and a shortage of workers, the country's national council of coffee producers said on Monday.
Peru will likely produce 6.2 million 46-kg bags of coffee in 2012 compared with a record 7.1 million bags in 2011, Council President Cesar Rivas said in a statement.

Vietnam March coffee exports ease to 187,000 T-customs
HANOI, April 17 (Reuters) - Vietnam's actual coffee export volume last month dropped 7.3 percent from February to 187,000 tonnes, or 3.12 million bags, the Vietnam Customs said on Tuesday.
Coffee exports between January and March fell 12.8 percent from the same period last year to 500,500 tonnes, the Finance Ministry-run customs department said in its monthly report.

Ghana cocoa purchases slip further - data
ACCRA, April 16 (Reuters) - Cocoa purchases declared to Ghana's industry regulator Cocobod reached 720,900 tonnes by April 5 from the start of the season, down 5.8 percent on the same period last year, according to Cocobod data seen by Reuters on Monday.
The latest data points to a strong tailing-off in recent weeks of output in the world's number 2 producer, whose 2011/12 crop by late January was some six percent ahead of the previous year after the first 15 weeks of the season.

Brazil March cocoa grind up 3 pct on yr
April 16 (Reuters) - Cocoa grinding in Brazil rose 3 percent in March compared to the same month last year to 20,269 tonnes, industry data showed.  
Brazil is the world's sixth-largest cocoa producer.

Uganda expects April coffee exports to rise yr/yr
KAMPALA, April 16 (Reuters) - Uganda expects coffee exports to rise to 180,000 60-kg bags this month from 176,561 bags in April 2011, a source at the state-run Uganda Coffee Development Authority (UCDA) said on Monday.
"The harvest in south and southwestern regions has begun and we're expecting fairly good yields since we've not witnessed the drought that we had last year," a UCDA source said.

Recap: Cotton Futures (Source: CME)
May and July cotton futures settled high-range with gains of 173 and 121 points, respectively. Deferred contracts finished at or near their daily lows with gains of 4 to 31 points. Cotton futures benefitted from corrective short-covering after sharp to limit-lower losses yesterday amid widespread risk aversion and beneficial rains in the South over the weekend.

Obama to Urge Congress for More Regulation of Oil Markets (Source: Bloomberg)
President Barack Obama urged Congress to bolster federal supervision of oil markets, including bigger penalties for market manipulation and greater power for regulators to increase the amount of money traders must put up to back their energy bets. Obama asked Congress to fund a six-fold increase for surveillance and enforcement staff at the Commodity Futures Trading Commission to put “more cops on the beat” overseeing oil markets. He also is seeking to give the CFTC new authority to raise margin requirements for traders’ oil positions and stiffen civil and criminal penalties for businesses that are guilty of market manipulation to $10 million from $1 million. The plan would cost $52 million. “We can’t afford a situation where some speculators can reap millions, while millions of American families get the short end of the stick,” Obama said in remarks in the White House Rose Garden today.
The price of gasoline has emerged as an issue in the 2012 presidential campaign and raised concern that it may slow economic growth by pinching consumer spending. Obama has been seeking to set out his differences with Republicans. Mitt Romney, the likely Republican nominee, has accused the Obama administration of thwarting domestic oil production through regulations.

Oil slips towards $118 on euro zone worries
LONDON, April 17 (Reuters) - Brent crude oil slipped to $118 on Tuesday, continuing a steep decline as rising Spanish debt costs raised fears of a new euro zone crisis that could derail economic growth.
"A new euro zone debt crisis appears to be building," said Carsten Fritsch, analyst at Commerzbank in Frankfurt. "It could have a serious impact on commodities and the growth outlook."

Iran says Saudi unable to fill oil gap in long run-TV
DUBAI, April 17 (Reuters) - Saudi Arabia will not be able to replace Iranian oil supplies in the long run, in case of shortfalls due to sanctions against Iran, state television quoted Iranian Oil Minister Rostam Qasemi as saying.  
On Friday, Saudi Oil Minister Ali al-Naimi said top oil exporter Saudi Arabia was determined to bring down high oil prices, reiterating there were no supply shortages in the global markets and the kingdom stood ready to use its spare production capacity if necessary.

Oil and gas cos output soars on favorable weather
April 16 (Reuters) - Oil and gas companies like Denbury Resources Inc  and Oasis Petroleum Inc  said a mild winter in the Dakotas helped them produce more liquids in the first quarter, as they continued to shift away from dry gas.
Oil producers and explorers are increasingly directing their spending towards liquids-rich fields including the Bakken in North Dakota and the Eagle Ford in Texas as low natural gas prices force companies to cut output.

Oil Trades Near Two-Week High on Spanish Debt, IMF Forecast (Source: Bloomberg)
Oil traded near the highest close in two weeks after Spain raised more debt than planned at an auction and the International Monetary Fund boosted its global growth outlook, easing concern a slowing economy will curb demand for crude. Futures were little changed after gaining for a second day yesterday. Spain sold 3.2 billion euros ($4.2 billion) of bills, compared with a maximum target of 3 billion. The IMF raised its growth forecast for 2012 to 3.5 percent from 3.3 percent and increased its 2013 estimate. U.S. crude stockpiles rose for a fourth week, data from the American Petroleum Institute showed. Crude for May delivery was at $104.26 a barrel, up 6 cents, in electronic trading on the New York Mercantile Exchange at 9:42 a.m. Sydney time. The contract yesterday gained 1.2 percent to $104.20, the highest close since April 2. Prices are 5.5 percent higher this year.
Brent oil for June settlement rose 10 cents to $118.78 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark contract’s front month premium to West Texas Intermediate closed at $14.14, the lowest since Feb. 1. U.S. crude supplies increased 3.4 million barrels last week, figures from the industry-funded API show. An Energy Department report today may show inventories expanded 1.8 million barrels, according to the median of 10 analyst estimates in a Bloomberg News survey.

BHP Iron Ore Output Advances 14%, Meeting Expectations (Source: Bloomberg)
BHP Billiton Ltd. (BHP), the world’s largest mining company, said third-quarter iron ore production rose 14 percent as it expands its mines and port in Australia, while warning that strikes severely depleted coal stocks. Output of the steelmaking raw material, its biggest earning unit, was 37.9 million metric tons in the three months to March 31, compared with 33.2 million tons a year earlier, the Melbourne-based company said today in a statement. That compares with the median estimate of 37.3 million tons from four analysts compiled by Bloomberg. BHP and Rio Tinto Group (RIO), which yesterday reported quarterly iron ore output that missed expectations, are expanding production of the raw material to keep pace with Chinese demand. Steel production in China, the biggest producer, hit a record last month as new plants raised output amid higher prices, the National Bureau of Statistics said.
“Iron ore is obviously positive just through the sheer drive to develop that particular commodity,” said David Lennox, resource analyst at Fat Prophets. “Their key iron ore division especially is running flat out.”

Gold May Advance as Euro-Area’s Debt Crisis Spurs Demand (Source: Bloomberg)
Gold futures advanced from a one- week low as the dollar declined, increasing demand for the metal as an alternative investment. The greenback fell for the second straight day against a basket of currencies as European debt concerns eased and the International Monetary Fund increased its forecasts for economic growth. The Standard & Poor’s GSCI Spot Index of 24 commodities rose as much as 0.9 percent. “The dollar’s weakness is supporting all commodities, including gold,” Sterling Smith, a market analyst at Country Hedging in St. Paul, Minnesota, said in a telephone interview. Gold futures for June delivery rose 0.1 percent to settle at $1,651.10 an ounce at 2:11 p.m. on the Comex in New York. Earlier, the price dropped to $1,635.20, the lowest since April 10. The precious metal has advanced 5.4 percent this year. Silver futures for May delivery jumped 1 percent to $31.674 an ounce on the Comex. Prices have climbed 13 percent this year.
On the New York Mercantile Exchange, platinum futures for July delivery climbed 0.6 percent to $1,584.70 an ounce. Palladium futures for June delivery increased 1.7 percent to $661.95 an ounce.

20120418 0942 Soy Oil & Palm Oil Related News.

Recap: Soybean Futures  (Source: CME)
Soybean futures closed 5 1/2 to 7 1/2 cents higher, which was near the middle of today's range. Meal futures were mostly $2.40 to $3.40 higher, while soyoil posted gains of 9 to 12 points. Buyers returned to the soybean market today after consecutive days of corrective price declines. Fundamental support came from fresh demand news as USDA announced daily sales of 225,000 metric tons (MT) of soybeans to unknown destinations, split between this and the upcoming marketing year.

Soybean Complex Market Recap (Source: CME)
May Soybeans finished up 5 3/4 at 1425 3/4, 8 3/4 off the high and 7 1/2 up from the low. July Soybeans closed up 7 1/4 at 1431 1/2. This was 8 3/4 up from the low and 7 3/4 off the high. May Soymeal closed up 2.4 at 393.8. This was 2.7 up from the low and 1.5 off the high. May Soybean Oil finished up 0.1 at 55.76, 0.62 off the high and 0.15 up from the low. May soybeans closed slightly higher on the session but well off the early highs as long liquidation selling in corn emerged to drive corn moderately lower on the session. May soybeans were up 14 1/2 cents higher on the day early in the session but traded down to less than 3 higher late in the day before a bounce. A much stronger tone regarding the global growth outlook and the surge in the US stock market plus news of further strong export demand for US soybeans helped spark the solid gains early in the session today. The USDA confirmed sales of 225,000 tonnes of US soybeans to unknown destination with 110,000 tonnes for the 2011/12 season and 115,000 for the 12/13 season. Taiwan bought 60,000 tonnes of Brazil soybeans in their tender for US or Brazil soybeans which was expected. More estimates for a smaller South America crop than the April USDA estimate added to the positive tone. However, the market lacked new buying interest on the rally and weakness in old crop corn seemed to entice some late in the day, long liquidation selling.

Soybean bulls shouldn't get too cocky
--Gavin Maguire is a Reuters market analyst. The views expressed are his own. To get his real-time views on the market, please join the Global Ags Forum--
CHICAGO, April 16 (Reuters) - Roughly 600 million bushels and counting... That's the extent of soybean production cuts made by the U.S. Department of Agriculture (USDA) to South American soy crop projections since the beginning of the year.
Considering that total equates to roughly 20 percent of last year's U.S. crop - and that most traders are looking to U.S. producers to make up any 2012 supply shortfall - it's not that surprising that soybean prices have been able to muster their 20 percent price advance since the beginning of the year. But with demand rationing already taking place in response to the higher soybean costs, have prices already done enough to bring this market back into balance?

VEGOILS-Palm gains on tight supply; Europe woes weigh
SINGAPORE, April 17 (Reuters) - Malaysian palm oil futures inched up on tightening global oilseed supply, although gains were limited as weaker exports and soaring Spanish borrowing costs weighed on sentiment.    
"Negative macroeconomic factors coupled with weaker export numbers may force traders to take profits. But fundamentally supply for crude palm oil and other vegetable oil is still very tight, so that should be supportive throughout the second quarter," said Alan Lim, research analyst with Kenanga Investment Bank in Malaysia.