Thursday, May 3, 2012

20120503 1837 FCPO EOD Daily Chart Study.

FCPO closed : 3370, changed : -82 points, volume : higher.
Bollinger band reading : downside biased with possible pullback correction.
MACD Histogram : falling lower, seller in control.
Support : 3350, 3300, 3270, 3250 level.
Resistance : 3380, 3420, 3450, 3470 level.
Comment :
FCPO plunged severely lower with increasing volume transacted. Soy oil price trading weaker after overnight closed recorded loss while crude oil price also sliding lower.
Anticipation of higher crude palm oil production and slowing global economy growth development sent price lower by more than 2% hitting new 6 week low.
End of day daily chart reading switched to calling a downside biased market development with possible pullback correction.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20120503 1823 FKLI EOD Daily Chart Study.

FKLI closed : 1582 changed : -1.5 point, volume : lower.
Bollinger band reading : pullback correction little downside biased.
MACD Histogram : recovering, seller taking profit.
Support : 1580,1570, 1565, 1550 level.
Resistance : 1590, 1595, 1600, 1605 level.
Comment :
FKLI closed slightly lower with shrinking volume changed hand doing 1 point discount compare to cash market that also marginally higher. Overnight U.S. markets closed little lower and today Asia markets ended mixed while European markets currently trading higher.
Regional market tradind in different direction with saparate regional agenda with some higher Europe companies corporate earnings, higher jobless data and focus on French Presidential election, slowed China services industry data and U.S. data showed companies added fewer jobs than projected.
Daily chart reading remained calling a pullback correction little downside biased market development testing resistance near middle Bollinger band 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.

20120503 1740 Regional Markets EOD Daily Chart Study.

 DJIA chart reading : little upside biased
 Hang Seng chart reading : pullback correction upside biased.
KLCI chart reading :  pullback correction downside biased.

20120503 1555 Global Market & Commodities Related News.

Asian shares slipped and the euro languished near a 2-week low after disappointing economic data from both sides of the Atlantic rekindled concerns about the strength of global growth.

The S&P 500 and the Dow edged lower o n W ednesday as data showed that private sector hiring fell far more than expected in April, sparking concerns that Friday's U.S. jobs report will also disappoint investors.

FOREX-Euro and kiwi retreat on weak data; ECB eyed
SINGAPORE/SYDNEY, May 3 (Reuters) - The euro wallowed near two-week lows against the greenback on Thursday, having fallen sharply overnight on the back of more depressing economic news out of Europe that has put the spotlight on the central bank's policy meeting later in the day.
"It seems too early for another wave of easing, but that is where the risks are skewed. The outcome is continued downward pressure on EUR/USD," said Sebastian Galy, strategist at Societe General.

Chicago corn and wheat rose around half a percent, as grain markets took a breather after suffering their biggest decline in more than three months in a selloff sparked by prospects of bumper U.S. crops.

Vietnam cuts 2012 rice export forecast to 5.4 mln T
Vietnam's 2012 rice exports will decline by a quarter from last year to 5.4 million tonnes, the Agriculture Ministry said on Thursday, basing its forecast on lower first-quarter sales.

China inks Argentine corn deal but exports blocked
Argentina will not export corn to China until a deal is reached over the genetically modified crops, which are favored by farmers in the South American country but currently barred by Beijing, an industry group said on Wednesday.

Unlimited India sugar exports to lure bargain hunters
India's decision to allow unlimited sugar exports into an already oversupplied market is likely to keep prices at hovering at one-year lows, but it could prove a sweet deal for buyers looking for bargains, dealers said on Thursday.

The euro wallowed near two-week lows against the greenback, having fallen sharply overnight on the back of more depressing economic news out of Europe that has put the spotlight on the central bank's policy meeting later in the day.

Brent crude steadied above $118 a barrel, reflecting caution among investors ahead of a key U.S. employment report after dismal data from the United States to Europe renewed doubts about the state of the global economy.

Goldman declines comment on iron ore trading plans
LONDON, May 2 (Reuters) - Goldman Sachs  declined to say whether it was scaling back its iron ore business after a source close to its London-based operations said its leading trader had gone back to trading coal alongside iron ore in the last two months.
Jeremy Peters, who previously worked on Goldman's coal derivatives desk, started to trade iron ore derivatives when Goldman Sachs entered this market in early in 2011, quickly becoming one of the top ten players in this small but growing sector.

Italy steel exports up, imports down in Jan-Feb
MILAN, May 2 (Reuters) - Steel exports from Italy, the European Union's No. 2 producer after Germany, rose 10 percent year-on-year to 2.997 million tonnes in the first two months of 2012, and imports dropped 29.7 percent, data from industry body Federacciai showed on Wednesday.
Steel imports, about 62 percent of which came from other EU countries in the January-February period, fell to 2.249 million tonnes in the first two month of 2012, data published on Federacciai's website showed.

China steel mills too big to fail - or succeed
HANCHENG, China, May 3 (Reuters) - In a ramshackle township in northwest China's Shaanxi province, red Communist Party banners call on a nearby steel mill's workers to seek "progress" and avoid making "backward steps".
The slogans demonstrate the hybrid nature of China's floundering steel sector, which as it tries to serve the twin masters of the state and the market has seen margins plummet and racked up a mountain of debt.

Copper experts hike 2012 price forecast-Chile Cochilco
SANTIAGO, May 2 (Reuters) - Copper market experts have hiked their 2012 price forecasts to $3.84 per lb on expectations for a mild recession in the euro zone, reduced likelihood of a global financial crisis and a soft landing in China, Chile's state copper commission Cochilco said on Wednesday.
A Cochilco poll of 21 specialists produced an average copper price of $3.84 per lb this year, compared with an average forecast of $3.62 per lb from a survey conducted in November.

London copper ticked down amid thin volumes, after posting its biggest daily drop in more than a week in the previous session as disappointing economic data from both sides of the Atlantic dented the outlook for demand.

Gold remained under pressure after disappointing data from both sides of the Atlantic fueled concerns about global growth, while investors awaited a rate decision by the European Central Bank later in the day for more trading cues.

METALS-London copper ticks down; bleak economic data weighs
SHANGHAI, May 3 (Reuters) - London copper ticked down on Thursday amid thin volumes, after posting its biggest daily drop in more than a week in the previous session as disappointing economic data from both sides of the Atlantic dented the outlook for demand.
"Prices are hardly moving today. Until we get clearer trading cues, we should expect copper prices to fluctuate within small ranges while prices consolidate," a Qingdao-based trader said.

PRECIOUS-Gold under pressure from weak data; ECB eyed
SINGAPORE, May 3 (Reuters) - Gold remained under pressure on Thursday after disappointing data from both sides of the Atlantic fueled concerns about global growth, while investors awaited a rate decision by the European Central Bank later in the day for more trading cues.
"With the euro zone debt crisis threatening to flare up again, we can see some pressure on gold if the dollar rises," said Lynette Tan, an analyst at Phillip Futures in Singapore.

20120503 1129 Global Market & Commodities Related News.

GLOBAL MARKETS-Shares, euro slip as data casts doubt on recovery
SINGAPORE, May 3 (Reuters) - Asian shares slipped on Thursday and the euro wallowed near a two-week low after disappointing data from both sides of the Atlantic rekindled concerns about the strength of the global economic recovery.
"It seems too early for another wave of easing, but that is where the risks are skewed. The outcome is continued downward pressure on EUR/USD," said Sebastian Galy, strategist at Societe General.

COMMODITIES-Weak data hits markets; natgas down most
NEW YORK, May 2 (Reuters) - Commodities tumbled across the board on Wednesday as disappointing U.S. and European economic data weighed on oil and many other markets, while ideal crop conditions led to double-digit losses in grains.
"The market is viewing the fact that Centaurus is a big player and they are going to have to liquidate," Dominick Chirichella, analyst at the Energy Management Institute, said, adding that the sell-off may have been an "overreaction".

OIL-Oil sags on inventory build, soft data
NEW YORK, May 2 (Reuters) - Crude oil futures fell on W ednesday, as U.S. crude inventories soared to their highest level in more than 20 years after rising for the sixth straight week last week and employment dipped in the United States and Europe, dimming the outlook for oil demand.
"The report doesn't seem to be supportive of a further rally," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.

NATURAL GAS-US natgas futures end down 5 pct after Centaurus news
NEW YORK, May 2 (Reuters) - U.S. natural gas futures, off early on moderate weather forecasts and profit-taking after a three-day rally, ended down sharply on Wednesday amid pressure from news that a huge natural gas hedge fund would close.
"The market is viewing the fact that Centaurus is a big player and they are going to have to liquidate," Energy Management Institute's Dominick Chirichella said.

EURO COAL-Prompt prices slide $3, attracting buying
LONDON, May 2 (Reuters) - European coal prices slid by $3 on Wednesday to $88 a tonne, having touched two-year lows the day before, and the drop in prices drew out some buying.
"If you look at the fixed prices for these (July) trades compared with coal paper (swaps), they were done at $3.50 below swaps, and for any utility that's got to be attractive," one European trader said.

20120503 1022 Malaysia Corporate Related News.

The controversial share swap crafted for the benefit of the country‟s aviation industry had led to „an impediment‟ to the revival of Malaysian Airlines (MAS) and has to be ditched. However, both MAS and AirAsia will still cooperate on several areas in a bid to save cost in line with global trends. Khazanah Nasional said it had terminated the share swap with AirAsia major shareholder Tune Air. Both Tan Sri Tony Fernandes and Datuk Kamarudin Meranun resigned from the MAS board the same day. The parties entered into supplementary agreements to jointly explore and set up JV companies to provide aircraft component maintenance support and repair services, and to set up a SPV for procurement with the aim of saving cost. MAS will hold a 50% equity stake in the SPV with AirAsia (35%) and AirAsia X (15%). They will continue to explore cooperation in the area of training. Under the earlier agreement, MAS was to be only a full-service premium carrier, while AirAsia and AirAsia X will be low-cost carriers. The new collaboration terms allow the airlines to enter each other‟s domain if they wish to. Fernandes said, “The sad part for me is that I have left something unfinished and I know both me, and Kamarudin could have done a lot to turn around MAS. But on the positive side, after 10 years of pain and after eight months, we now are very close to MAS and Khazanah and that is very positive as all our energies can be now focused to tap the amazing growth potential of Asean and Asia.” With the reversal, the shares will be transferred back to the original owners and Khazanah‟s stake in MAS will rise from 49% to 69.5% thereby triggering the requirement to make a general offer. But Khazanah said it had applied for and got a waiver from the Securities Commission from making the GO. MAS employees union president Alias Aziz said, “The staff morale is up again and we would like to thank the Prime Minister. Had he not listened we would have to continue to suffer. And as far as the CCF is concerned, we would study the implications on MAS. So long it benefits MAS, we will support it.” (Financial Daily)

Malaysia's policy response to Jakarta's lower export tax for refined palm oil, which has shifted orders away to Indonesia, may come after the government lists its plantation assets in a US$3bn IPO, said top industry analyst Dorab Mistry. Malaysia has struggled to formulate a response to the new tax regime since it came into force in September, allowing Indonesian refiners to export at a sizable discount and grab market share. "My expectation is that the Malaysian response will not come until the FELDA IPO is safely executed and the market gives FELDA shares a warm welcome," Mistry, who trades for Indian conglomerate Godrej International added. (Reuters)

Future highway concession agreements in Selangor will have to include an "exit clause" which allows for toll collection to be stopped once the concessionaire makes its projected profit. MB Tan Sri Khalid Ibrahim said once the projected profit was met, the management of the project would also be transferred to the state government. "This will allow concessions to end earlier. For example, if the concession is 40 years long, but the highway concessionaire makes the projected profit within 25 years due to heavy traffic volume, then the exit clause will kick in. "That means toll collection can be stopped and the highway will be managed by the government," he said. Should any party object to the proposal, Khalid said the state government would not help them acquire the land needed to develop the highways. There are "five or six" proposed highways in the state, he said, including the Sungai Besi-Ulu Klang Expressway (SUKE) and West Coast Expressway. On principle, the state had agreed to the construction of SUKE. (Starbiz)

Astro has denied any wrongdoing amid forgery allegations raised by Lippo Group against its executive deputy chairman Ralph Marshall. The pay-TV operator claims the allegations are a ploy by Lippo Group to avoid paying some US$300m in damages owed to Astro from an international arbitration award over their failed business venture. “Astro categorically denies any wrongdoing on its part and on the part of Marshall, and will take all steps necessary to challenge these defamatory allegations against Marshall, including seeking relief available in international law." “Their calculation is that if they can exploit the criminal law to cause confusion and fear, they can avoid paying the damages,” Astro‟s lawyer Hafzan Taher said. According to recent media reports, Indonesian police have issued an arrest warrant for Marshall – the right hand man of tycoon T. Ananda Krishnan – and are also attempting to seek a red notice alert from Interpol.(BT)

Malaysia has appointed Maybank Investment Bank, CIMB Investment Bank, RHB Investment Bank and AmInvestment Bank to manage a sale of Islamic bonds to partly finance the construction of a mass railway in Kuala Lumpur, three people familiar with the matter said. Dana Infra, a company owned by the Finance Ministry and created to fund development projects, will sell ringgit-denominated notes as early as the end of this month, said the people. The government has yet to set a final amount for the sale and agreed to guarantee RM8bn in the initial issuance, which could be as much as RM2bn, two of the people said. Dana Infra may issue an additional RM30bn of the securities via a 50-year programme, which will be announced later. (Bloomberg)

The new CEO of Tenaga Nasional will be announced today to replace current president and CEO Datuk Seri Che Khalib. The new CEO will be an internal candidate a source said as TNB has a history of promoting from within such as the late Datuk Pian Sukro. Potential appointees could be TNB‟s current COO Datuk Azman Mohd, VP of generation Datuk Mohd Nazri Shahruddin and VP of transmission Datuk Rozimi Remeli. (BT)

Malakoff Corp, a unit of MMC Corp has acquired a 40% stake in Hidd Power Co (HPC), a power and water generation provider located in Bahrain. However, the price at which Malakoff acquired the stake was not disclosed. The good news is that power projects in the United Arab Emirates do not have a very high sovereign risk compared with places such as Pakistan, where reports suggest that Malakoff was proposing to set up two power plants. (Financial Daily)

Opcom signed a RM82m two-year variation contract with Telekom Malaysia. Opcom said on Wednesday the variation contract was for a two-year extension of the contract to supply and provide support services of passive fibre-to-the-home system. To recap, on April 22, 2009, Opcom announced that Opcom Cables gad received a letter of award for RM359m from TM for the contract. Subsequently, it announced the two-year extension of the contract from April 2, 2011 to April 19, 2013 on May 23, 2011. (StarBiz)

YTL Communications is willing to consider collaborating with other players in Long Term Evolution (LTE) or 4G services, said YTL Corp group MD Tan Sri Francis Yeoh. The company will increase is base stations to 5,000 by year-end vs 2,200 currently. It aims to grow its subscriber base to 0.5m by end-12. The company launched its first smartphone, the Eclipse, which runs on its converged 4G network. Manufactured by Foxconn and developed jointly with GCT Semiconductor and D2 Technologies, the Eclipse is priced without a data plan at RM1,688. (StarBiz)

YTL Communications confirmed that it has secured the 1Bestarinet projects, worth RM1.5bn for the first five years. According to the 1Bestarinet website, work has already started on the project which aims to provide internet access and a virtual learning platform to around 10,000 schools. (Financial Daily)

QSR Brands will invest some RM21m in new Pizza Hut restaurants and upgrading existing ones this year. It plans to open five dine-in Pizza Hut restaurants in Malaysia with an investment of RM6m and upgrade 30 outlets with an allocation of RM15m. QSR Brands managing director Jamaludin Md Ali said there are currently 253 Pizza Hut restaurants in the country, including Pizza Hut Delivery outlets. Of this, 210 are dine-in outlets. "Last year, sales of Pizza Hut Malaysia rose 8% to RM442m, and we expect double-digit growth this year," he said. It introduced 24 new items, including non-pizza and non-pasta items such as Western favourites, sandwiches and rice dishes. "The new menu is part of our growth strategy which is to maintain our existing range of products and from time to time add new items that focus on value to customers," Jamaludin said, adding that the new menu would make the Pizza Hut brand even more relevant to its growing young affluent customer base. Pizza Hut is spending RM2m on advertising and promotion of its new dine-in menu, including TV and radio commercials, press advertisements, teasers, in-store promotions and point-of-sale materials. (Sun)

Domino's Pizza Malaysia wants to enter the East Coast and East Malaysia markets by early 2013 and end-2013, respectively, said president and chief operating officer of Domino's Pizza Malaysia and Singapore, Ba U Shan-Ting. He said there is a lot of scope to grow in the delivery segment, especially in areas like the East Coast, Sabah and Sarawak, which if tapped, would enable it to maintain its market leadership in the delivery segment. He said the delivery segment makes up two-thirds of its business and it does not compete in the dine-in segment. "We are looking seriously at East Malaysia. We're now doing surveys, understanding the market …we will go into the market possibly next year. There are a lot of logistic issues," he said. Ba said this year, it will spend up to RM12.5m on 25 new stores in the peninsula, bringing its total number of stores to 100 by year-end. He added that each store costs up to RM500,000 and it has already opened five out of the 25 new stores for this year, bringing the number of outlets it currently operates to 80. The new stores are planned for Selangor, Kuala Lumpur, Negri Sembilan, Penang, Perak, Malacca and Johor. On its sales target, Ba said it aims for every store to have double-digit growth each year. Last year, its unaudited total sales were in excess of RM100m. Domino's allocates about 6% of its revenue for advertising and promotion activities every year. This year, it will spend close to RM1m on the "Extreme Edge" marketing campaign alone. (Sun)

Bintulu Port Holdings said the High Court of Bintulu, Sarawak has dismissed with cost the injunction orders and summons initiated by Integrated Marine Works (IMW) preventing the former from holding a tender for dredging works for a proposed Samalaju Port development project. IMW had claimed that the dredging works for the Samalaju Port must be awarded to it via direct negotiations based on the agreement it has with the government of Malaysia. (Malaysian Reserve)

BMW Group Malaysia has announced record performances in the first quarter of 2012 for its BMW, MINI and Motorrad brands. As of March 2012, the group delivered a total of 1,516 vehicles in the country, up 16% over the 1,308 units sold during the same period last year. Group managing director Geoffrey Briscoe said the introduction of sustainable and highly advanced green technology vehicles to the Malaysian market has been a key factor of its growing success as "it has enabled us to serve a market which is becoming increasingly conscious of the need to conserve resources and the environment". Also contributing to the group's growing performance is its network of dealerships which has grown steadily to 15 nationwide. (Bernama, BT)

MBM Resources intends to utilise RM75m, from up to RM104.6m expected to be raised by its proposed rights issue with warrants, to expand and enhance its nationwide retail and service network with new 3S (sales, service, and spare parts) centres. Group managing director Looi Kok Loon said the raising of funds will come progressively over the period of five years to help MBMR in terms of funding needs for future expansion. In a filing to Bursa Malaysia, MBMR fixed the price of its 73.7m renounceable rights issue at RM1.42 per rights share while the exercise price of the accompanying free detabchable warrants at RM3.20 per warrants. (Malaysian Reserve)

Daya Materials' wholly-owned subsidiary, Daya CMT (DCMT) has been awarded a contract from Yuk Tung Cop for the construction of the proposed three-blocks of 28-storey mixed development for RM270m. The project was scheduled to begin in May 2012 and is expected to be completed within approximately 30 months. DCMT will fund the development of this project through internally-generated funds and bank borowings. (Malaysian Reserve)

HeiTech Padu has been awarded a RM15.2m contract by Jabatan Pendaftaran Negara for the extension of maintenance services of the wide area network. (Malaysian Reserve)

Menang Corp, through its 51%-owned subsidiary Rumpun Positif (RPSB), has bagged a RM260m contract from the Ministry of Higher Education and Universiti Teknology Mara (UiTM). The agreement is for RPSB to embark on the construction of the proposed UiTM satellite campus in Selangor on a private finance initiative basis. Menang said the total construction cost for the project will come to about RM260m. The construction of the proposed campus under the build-lease-maintain-transfer concept is said to take three years to complete. Thereafter, RPSP will lease the campus to UiTM for a 20-year period. (Financial Daily)

Red FM has maintained its position as the only local English radio station to achieve continuous growth over five years, according to the first Nielsen Radio Audience Measurement survey of 2012. With more followers coming on board, the audience for Red FM has grown to 300,000 listeners. The all new Red Breakfast show with Sarimah and Lil' Kev increased to 112,000 listeners and the Red Fix with Terry and Azura received a boost of 170,000 listeners. “We not only increased our total audience, but saw an increase in the sought after higher-income listeners. This is a fantastic achievement and it is due to the amazing team behind the station as well as our supportive partners,” Red FM COO Azrullah Mohd Nor said. (The Star)

Yinson Holdings: To acquire more assets
Yinson Holdings is gearing up to buy an offshore support vessel (OSV) and a floating, storage and offloading (FSO) vessel to be financed via proceeds from a private placement offering. Executive director Lim Chern Yuan said the company plans to use part of the RM20.4m proceeds from its private placement of 12m new shares to buy the new assets while adding that last year, Yinson has used its cash of RM26.4m for a 40% investment in Vietnamese Port of Phu My and to purchase an FSO. Lim, however, said Yinson will not place an order for the OSV until a contract is secured while adding that he does not see any problems in acquiring new ships due to the general oversupply of OSVs in the market. He said Yinson partnered with shipyards such as Nam Cheong Ltd to bid for jobs since the company needed companies that have the expertise. (Business Times)

Oil & Gas: Petronas offloads equity in Australia's APA Group
In a statement, APA said Petronas via its unit Petronas Australia Pty Ltd has sold the 111.3m securities it holds in APA, equivalent to 17.3% of the group's issued capital, in an institutional bookbuilding managed by Morgan Stanley. APA group MD Mick McCormack said Petronas has advised that its decision to sell follows a rationalisation of its investment portfolio. APA is Australia's largest natural gas infrastructure business, owning and or operating more than US$8bn (RM24bn) of gas transmission and distribution assets. Its pipelines and assets span every state and territory on mainland Australia, delivering 50% of the nation's gas usage.(Business Times)

Ramunia to seek nod for regularisation plan
Offshore oil and gas fabricator Ramunia Holdings Bhd said an extraordinary general meeting will be held on May 23 2012, to seek shareholders approval for the company's regularisation plan, approved by Bursa Malaysia on January 19.  The regularisation plan was submitted by AmInvestment Bank Bhd on July 13 2011, following the classification of Ramunia as a Practice Note 17 (PN17) company. (Source: Business Times)

Oil & Gas: 5 firms bid for oilfield jobs
Industry sources indicated that at least 5 local companies have put in their joint bids with foreign companies for the award of marginal oilfield development by  Petronas. The  5 are believed to be Ramunia Holdings, Boustead Heavy Industries Corp, Puncak Niaga Holdings, Daya Materials and a company under Perwaja Holdings. A source familiar with the matter said  Petronas is evaluating the bids now and will be making the awards soon. Petronas president and CEO Datuk Shamsul Azhar Abbas said in Mar that the national oil company was expected to award the next round of risk service contracts (RSCs) for the development of marginal oilfields in the next two months. (StarBiz)

Oil & Gas: Aker Solutions wins Siakap North-Petai job
Aker Solutions has been awarded a contract by Murphy Sabah Oil for the delivery of a subsea production system for the Siakap North-Petai deepwater development. The company however did not disclose the contract value. Siakap North-Petai is located offshore Sabah, in a water depth of 1,400 metres. The scope of work includes 13 subsea trees, 8 manifolds, well jumpers, engineering for topside controls and lifecycle support services. The first hardware delivery is scheduled for 1Q 2013. According to Aker Solutions, the contract will be delivered out of its high-tech subsea manufacturing centre in Port Klang, Malaysia. The subsea production system will be tied back to Murphy’s Kikeh floating production storage and offloading vessel. Aker Solutions is preparing for major growth by investing US$87m in its subsea business. This investment is set to double the capacity of its manufacturing plants in Tranby, Norway, and Port Klang, Malaysia. In addition, a new service base will also be established in Malaysia. (Business Times)

Aviation: IATA says total passenger demand for March up 7.6%
The International Air Transport Association (IATA) said total passenger demand rose 7.6% and freight demand climbed 0.3% in Mar 2012 compared with the same month last year. Comparisons with March last year were affected by events that depressed passenger demand in 2011, including the Arab Spring, which disrupted travel in the Middle East and North Africa beginning in Feb 2011 and the earthquake and tsunami in Japan in Mar 2011, that impacted air travel across the Asia-Pacific region. IATA estimated that the y-o-y rise in air travel in Mar was about two percentage points higher than it would otherwise have been in the absence of these events. Cargo demand, meanwhile, was affected by the timing of the Chinese New Year, which occurred in Jan this year - leading to stronger Feb shipments - but took place in Feb 2011, leading to stronger Mar 2011 shipments and weaker y-o-y comparisons. (Bernama)

QSR: To invest MYR21m in new Pizza Hut outlets, upgrading. QSR Brands Bhd will invest some MYR21m in new restaurants and upgrading existing ones this year. It plans to open five dine-in Pizza Hut restaurants in Malaysia with an investment of MYR6m and upgrade 30 outlets with an allocation of MYR15m. (Source: The Sun Daily)

20120503 1022 Local & Global Economy Related News.

Malaysia‟s inflation is moderating and growth is within expectations, Bank Negara Malaysia (BNM) Governor Tan Sri Dr. Zeti Akhtar said. Meanwhile, she also said that Asia’s domestic demand has become a more important growth source. Asia transforming into global consumers from producers and Asia has policy space to boost domestic demand, Zeti said. Asia is affected by quantitative easing and policy spillovers. Asia doesn‟t have the preconditions to pursue a single currency as it‟s costly to put preconditions in place for a single currency, Zeti said. (Bloomberg)

Malaysia must create conditions for competition to flourish on the basis of merit in order for the country to transform itself to a high-income nation, said CEO of Performance Management and Delivery Unit (Pemandu), Datuk Seri Idris Jala. He also said that it was important to implement all the Strategic Reform Initiatives identified in the New Economic Model to create conditions for competitiveness, productivity and profitability. When asked about the impact of minimum wage on investment, Jala said that the introduction of a wage floor was needed in order to make sure the lower strata of society, including foreign labour, were able to share in the country‟s prosperity. (Malaysian Insider)

Sarawak's manufacturing sector attracted RM8.4bn in investments last year, said Deputy International Trade and Industry Minister Datuk Jacob Dungau Sagan. Of the total, RM4.3bn or 51.2% was from domestic investors while the remaining RM4.1bn or 48.8% came from overseas, he said. Sarawak moved one rung up to third spot among the states in investments last year after Penang (RM9.1bn) and Selangor (RM8.7bn), he added. (Bernama)

Small and medium enterprises (SME) will have an easier way to market their products abroad. Deputy International Trade and Industry Minister Datuk Mukhriz Mahathir said the government had inked an agreement with foreign hypermarkets in Kuala Lumpur to sell these products at their outlets overseas. The government had set up promotional programmes and branding for SME products at foreign markets with help from various government agencies, he said. (NST)

Malaysia remains Southeast Asia‟s biggest tablet computer market, raking in US$374m (RM1.1bn) sales last year, according to GfK group. Technology lovers in this region snapped up more than 1.6m tablets over the 12-month span of 2011. GfK‟s retail tracking of tablet sales in Cambodia, Indonesia, Malaysia, Philippines, Thailand and Vietnam, found that five out of these six countries registered consistent expansion over each previous quarters. (BT)

Bank of Thailand’s Monetary Policy Committee held the policy rate at 3.00% in its meeting today, citing that the rate is appropriate for the current economic condition and inflation scenario. (The Nation)

China’s final HSBC manufacturing PMI rose to 49.3 in Apr from 48.3 in Mar. (Bloomberg)

India’s HSBC-Markit manufacturing PMI rose to 54.9 in Apr (54.7 in Mar), breaking two consecutive months of decline. (WSJ)

Indonesia’s Danareksa consumer confidence index declined in Apr to 83.4 from 84.8 in Mar. (Bloomberg)

Bank Indonesia's retail sales index was 115.5 in Mar, up from a revised 110.0 in the previous month, driven by strong sales of household goods. (Reuters)

Indonesia is expected to announce the ceiling on single shareholder stakes in commercial banks this month. Indonesian central bank governor Darmin Nasution was quoted last week as saying that it would likely issue the new regulation this month. The Financial Times in an interview with some Jakarta bankers said that the authorities were looking at a 50% limit, with Halim Alamsyan, Bank Indonesia's deputy governor, saying "the plan is to put a threshold on the maximum ... ownership [of shares] for an individual or entity." (Financial Daily)

Japan’s total vehicle sales grew 93.7% yoy in Apr (71.8% in Mar), whilst standard-vehicle sales growth notched up to 92.0% from 78.2% in Mar. (Bloomberg)

Japan’s monetary base fell 0.3% yoy in Apr to ¥121.5tr (-0.2% in Mar), whilst labour cash earnings grew 1.3% yoy in Mar (a revised 0.1% in Feb), almost six times the survey estimate of 0.2%. (Bloomberg)

Eurozone unemployment rose to 10.9% in Mar (10.8% in Feb), equaling the record high of 15 years ago as Italy and Spain joblessness rose. This matches economists‟ expectations. In the wider 27-nation European Union, unemployment was steady at 10.2%. (Reuters)

The Eurozone manufacturing PMI fell to 45.9 in Apr (47.7 in Mar), the lowest in 34 months and is just a shade lower than the consensus estimate of 46. The output sub-index slumped to 46.1 from Mar's 48.7 and below a flash reading of 46.4, chalking up a five-month low. (Bloomberg, Reuters)

The ADP National Employment Report showed the US private sector added 119,000 jobs last month, below economists' expectations for a gain of 177,000 jobs. (Reuters)

New orders for manufactured goods in the US dropped 1.5% mom in Mar after a revised 1.1% rise in Feb as demand for transportation equipment and a range of other goods slumped. (Reuters)

20120503 1021 Global Market Related News.

Asian Exporters Fall on New Zealand, U.S., Europe Jobs (Source: Bloomberg)
Asian exporters fell as jobless rates in Europe and New Zealand climbed and U.S. companies added fewer jobs than economists estimated, fueling concern the global economy is slowing. LG Display Co. (034220), the world’s No. 2 maker of liquid-crystal displays, sank 3.2 percent in Seoul. Hyundai Motor Co., South Korea’s biggest carmaker, slid 2.1 percent. Fisher & Paykel Appliances Holdings Ltd., a maker of refrigerators and washing machines that gets about 30 percent of sales from North America and Europe, fell 2.7 percent in Wellington. Westpac Banking Corp. added 0.9 percent after Australia’s second-biggest lender posted higher first-half profit. “Europe will continue to remain the risk for global equity investors,” Diane Lin, a fund manager who helps manage $1 billion in equities at Pengana Capital Ltd. in Sydney. “The next big issue will be the slowing economic growth and how it affects the underlying stability” for earnings growth in Asia.
The MSCI Asia Pacific Excluding Japan Index (MXAPJ) dropped less than 0.1 percent to 444.05 as of 8:48 a.m. in Hong Kong, with about the same number of shares rising and falling. Japanese markets are closed today for a holiday. The regional gauge has risen 2.5 percent in the past seven days following moves to stimulate economic growth in Japan and Australia and amid signs manufacturing output in U.S. and China is improving.

Foreigners Sell Indian Equities in April as Tax Concerns Weigh (Source: Bloomberg)
Foreign funds turned net sellers of Indian stocks in April, the first month of withdrawals in 2012, deterred by proposed changes in tax rules in the fourth-largest equity market in Asia outside Japan. Offshore investors sold a net $102.6 million of local equities last month, data compiled by the market regulator yesterday showed. Funds, who were net buyers in each of the previous three months, have invested a net $8.76 billion into Indian shares this year. “Long-term investors into India aren’t increasing their exposure as the horizon isn’t clear,” A.S. Thiyaga Rajan, a senior managing director at Aquarius Investment Advisors Pte. in Singapore, which has been investing in India since 1995 and has about $400 million in Indian assets, wrote in an e-mail. “First, there is uncertainty on tax. Second is the continuing depreciation of the rupee given weak economic fundamentals.”
Finance Minister Pranab Mukherjee proposed in March to introduce the General Anti-Avoidance Rule, or GAAR, to curb evasion of taxes by companies through misuse of tax treaties with other countries. Foreign funds are concerned the new rule may apply to their holdings of domestic shares, prompting U.S. trade and lobby groups to raise the matter in an April 17 letter to U.S. Treasury Secretary Timothy F. Geithner, who discussed the plans last month with Mukherjee.

Emerging Stocks Advance to 3-Week High on Manufacturing (Source: Bloomberg)
Emerging-market stocks rose to a three-week high after the pace of manufacturing picked up in China last month, boosting Asian information and technology companies, and Brazil’s Bovespa erased earlier losses. The MSCI Emerging Markets Index (MXEF) climbed 0.4 percent to 1,029.83 as of 4:30 p.m. in New York. Asustek Computer Inc. (2357) rallied to the highest level since May 2008 in Taiwan. OGX Petroleo & Gas Participacoes SA (OGXP3) rose the most in a week in Sao Paulo after its founder, billionaire Eike Batista, said he’s considering selling another stake in his EBX Group. Brazil’s Bovespa (IBOV) added 1 percent, paring earlier losses of as much as 0.4 percent. The final reading of Chinese manufacturing data from HSBC Holdings Plc (HSBA) and Markit Economics rose to 49.3 today from a preliminary 49.1 reported April 23 and a final 48.3 in March, signaling that a rebound in the world’s second-biggest economy may help to offset constraints on global growth from austerity measures in Europe.
In the U.S., the Institute for Supply Management’s factory index climbed to 54.8 in April from 53.4 a month earlier. “There is very little going on right now outside of China,” John-Paul Smith, emerging market strategist at Deutsche Bank AG, said by phone from London today. “The focus is there because of the data about the Chinese economy.”

Dow Average Retreats From Four-Year High on Jobs Data (Source: Bloomberg)
U.S. stocks fell, dragging the Dow Jones Industrial Average down from the highest level since 2007, as data showed companies added fewer jobs than economists projected and euro-region unemployment rose to a 15-year high. Energy and financial shares dropped the most among 10 groups in the Standard & Poor’s 500 Index. Chesapeake Energy Corp. (CHK) tumbled 15 percent after reporting an unexpected loss and saying it may run out of money next year under the weight of the lowest natural-gas prices in a decade. Bank of America Corp. retreated 1.8 percent. Stocks pared their slump as a gauge of homebuilders in S&P indexes advanced to the highest since 2008. The S&P 500 slid 0.3 percent to 1,402.31 at 4 p.m. New York time, after falling 0.9 percent earlier today. The Dow dropped 10.75 points, or 0.1 percent, to 13,268.57. The Nasdaq Composite Index increased 0.3 percent to 3,059.85 as Apple Inc. (AAPL) shares rebounded.
About 6.6 billion shares changed hands on U.S. exchanges, or 1.4 percent below the three-month average. “The labor market is weak at best,” said Keith Wirtz, who oversees $15 billion as chief investment officer for Fifth Third Asset Management in Cincinnati. “While we thought that we were gaining some momentum, more recent data suggest that things are sluggish. If we start to see a cascade of negative news, the market is going to be vulnerable.”

European Stocks Drop as U.S. Payrolls Miss Estimates (Source: Bloomberg)
European (SXXP) stocks declined for the second time in three days after reports showed that U.S. employers added fewer payrolls than forecast and euro-area unemployment rose to a 15-year high. Vestas (VWS) Wind Systems A/S slumped to an almost nine-year low after saying it’ll spend more money on turbine maintenance. Banco Santander SA led banks lower as European sovereign-bond yield spreads over German bunds widened. UBS AG (UBSN), the biggest bank in Switzerland, jumped 3.7 percent after first-quarter results beat analysts’ estimates. The Stoxx Europe 600 Index lost 0.4 percent to 257.39 at the close of trading, after earlier climbing as much as 1 percent. The benchmark gauge rose 0.4 yesterday after a report showed U.S. manufacturing expanded in April. All western European markets except the U.K., Ireland and Denmark were closed yesterday for May Day Holiday.
“The employment growth continues, though at a moderate pace,” Ralf Umlauf, head of floor research at Helaba Landesbank Hessen-Thueringen in Frankfurt, wrote in e-mailed comments. “With regard to the Friday publication of the official jobs report, the indications are mixed. It seems there is a slight potential for disappointment.”

German Stocks Retreat a Second Day as Unemployment Rises (Source: Bloomberg)
German stocks dropped for a second day as an unexpected increase in unemployment in Europe’s largest economy outweighed reports showing manufacturing expanded in the U.S. and China. Deutsche Bank AG and Commerzbank AG (CBK) each fell at least 2.5 percent as southern European bonds dropped. MAN SE (MAN) and BASF SE (BAS) also declined. HeidelbergCement AG (HEI) rose after analysts recommended buying its shares. The benchmark DAX (DAX) Index declined 0.8 percent to 6,710.77 at the close in Frankfurt, erasing an earlier rally of as much as 1.7 percent. The benchmark measure was closed yesterday for the May Day public holiday. The DAX has still gained 14 percent this year as investors speculated that companies in Germany will fare better than those in the euro area’s most indebted nations. The broader HDAX Index slipped 0.6 percent today.
“Some of the recent reports show Germany is now slowing probably in reaction to the slowdown in Europe,” said Neil Dwane, chief investment officer for Europe at RCM Ltd., in a phone interview. German unemployment unexpectedly rose in April. The number of people out of work increased a seasonally adjusted 19,000 to 2.87 million, the Nuremberg-based Federal Labor Agency said today. Economists had forecast a decline of 10,000, the median of 34 estimates in a Bloomberg News survey showed. The adjusted jobless rate was 6.8 percent.

U.K. Stocks Drop as Standard Chartered, Home Retail Fall (Source: Bloomberg)
U.K. stocks declined the most in more than a week as a contraction in euro-region manufacturing added to signs that the economic slump in Britain’s largest export market is worsening. Standard Chartered Plc (STAN) led banks lower, retreating 3.9 percent. Home Retail Group Plc (HOME) tumbled 13 percent after reporting a 60 percent slump in profit. British Sky Broadcasting Group Plc (BSY) paced advancing shares after operating earnings jumped 20 percent. The FTSE 100 (UKX) Index lost 54.12, or 0.9 percent, to 5,758.11 at the close in London. The gauge jumped 1.3 percent yesterday, its biggest rally since April 17 as gauge of U.S. manufacturing expanded at the fastest pace in 10 months. The FTSE All-Share Index declined 0.8 percent today and Ireland’s ISEQ Index slipped 0.1 percent.
“We have seen some of yesterday’s enthusiasm wane today, but there is still an appetite for risk out there,” said David Jones, chief market strategist at IG Index in London. “Some of the data coming out of Europe is a concern and raises the question of how long the European economy will take to get on a firmer footing; it can’t just be the U.S. driving growth.”

Spanish Stocks Plunge to Three-Year Low as Banks Tumble (Source: Bloomberg)
Spanish stocks plunged, pushing the IBEX 35 Index (IBEX) to its lowest level in more than three years, as a selloff in banks sent the benchmark measure tumbling. Banco Santander SA (SAN), the country’s largest lender, lost more than 3 percent as Moody’s Investors Service prepared to concluded its review of the euro area’s banks. Sacyr Vallehermoso SA (SYV) dropped 4 percent as a report showed manufacturing in Spain contracted. Red Electrica Corp. slid 2.2 percent as Bolivia seized the company’s local assets. The IBEX 35 dropped 2.6 percent to 6,831.9 at the close in Madrid, its lowest level since March 2009. The gauge has sunk 20 percent this year, the worst performance of 24 developed markets tracked by Bloomberg, as the Spanish economy entered its second recession since 2008.
“The euro-zone debt crisis has become center stage once more with Spain the focus of attention,” said Ted Scott, director of global strategy at F&C Asset Management in London, in a note to clients. Spanish bond yields “reflect the diminishing effect of the European Central Bank’s liquidity program and increasing concerns about the Spanish economy and especially its banking sector.”

Stocks, Euro Fall on Employment Concern; Treasuries Rise (Source: Bloomberg)
Stocks fell, the euro weakened for a third day against the dollar and Germany’s five-year note yield fell to a record amid concern about employment markets in Europe and the U.S. Wheat led commodities lower. The Standard & Poor’s 500 Index lost 0.3 percent to close at 1,402.31 at 4 p.m. in New York, paring an earlier loss of 0.9 percent as homebuilders and retailers rallied. The Dow Jones Industrial Average (INDU) retreated from a four-year high. The euro depreciated 0.6 percent to $1.3160 as the U.S. currency strengthened against most major peers. German five-year note yields sank as low as 0.55 percent and 10-year Treasury rates decreased less than two basis points to 1.93 percent, near a three-month low. Oil fell after a surge in inventories. German unemployment rose in April as euro-area manufacturing shrank for a ninth month and more than initially estimated, according to reports today.
American companies added 119,000 workers in April, according to figures from ADP Employer Services, 51,000 fewer than t he median economist forecast and damping optimism about the economy before government jobs data in two days. U.S. factory orders decreased. “I’ve got a feeling that we might see a downside surprise on the monthly jobs report,” Randy Frederick, managing director of active trading and derivatives at Charles Schwab Corp., said in an interview from Austin, Texas. His firm has $1.83 trillion in client assets. “We’ve got a weak ADP report. There’s a reemergence of concerns in Europe. Given how high the market is right now and this softening in economic data, it’s very likely to see a pullback in the range of 5 percent to 10 percent.”

FOREX-Euro falls on weak euro zone manufacturing data
LONDON, May 2 (Reuters) - The euro fell against the dollar on Wednesday as weak manufacturing data raised concerns about risks facing the euro zone economy, while the yen rebounded from 2-1/2 month highs versus the U.S. currency after strong U.S. numbers on Tuesday.
"It is prudent to watch and wait at the moment. There is so much in the way of information and given the lack of liquidity with it being Golden Week in Japan and the May Day holiday yesterday it will take a while for the market to make an assessment," said Lauren Rosborough, senior currency strategist at Societe Generale.

Payroll Survey Signals U.S. Jobs Slowing as Orders Drop: Economy (Source: Bloomberg)
Companies in the U.S. added fewer workers last month, according to data from a private survey, pointing to a cooling in the job market, as the Commerce Department also reported a decline in factory orders in March. Private employment increased by 119,000, the smallest gain in seven months, after rising by 201,000 in March, Roseland, New Jersey-based ADP Employer Services said. Orders to factories fell 1.5 percent following a 1.1 percent gain in February. Stocks retreated as the smaller-than-projected advance in payrolls raised concerns government data in two days will show the world’s largest economy isn’t growing fast enough to reduce unemployment. A report yesterday showing manufacturing expanded in April at the fastest pace in almost a year helped send the Dow Jones Industrial Average to the highest level since 2007.
“Some slowing of job growth was expected,” said Gus Faucher, a senior economist at PNC Financial Services Group Inc. in Philadelphia. “As of now, the job market continues to expand, and we’re getting close to a self-sustaining recovery” where job growth supports wage gains, he said.

Four Fed Policy Makers See No Need to Ease With Economy (Source: Bloomberg)
The odds of more Federal Reserve stimulus diminished yesterday as four central bankers said it probably won’t be needed and an unexpected acceleration in U.S. manufacturing provided fresh evidence of economic strength. John Williams, president of the San Francisco Fed, joined his counterparts from Richmond, Philadelphia and Atlanta in casting doubt on the need for additional purchases of bonds to push down longer-term interest rates. Three of them are voting members of the rate-setting Federal Open Market Committee. Thresholds for further action “would be if we see economic growth slow to the point where we’re not seeing further progress in bringing the unemployment rate down,” Williams said, or if inflation dropped “significantly” below the Fed’s 2 percent goal. Those aren’t “the circumstances I currently expect,” Williams said at a conference in Beverly Hills, California.
The FOMC left policy unchanged after its April 24-25 meeting, and Chairman Ben S. Bernanke signaled that further easing is unlikely unless the economy unexpectedly deteriorates. Bernanke said it would be “reckless” to pursue policies that would drive up inflation when it’s already near the Fed’s target, while noting he’s “prepared to do more” should conditions worsen.

Factory Orders in U.S. Decrease on Pullback in Aircraft (Source: Bloomberg)
Orders to U.S. factories decreased in March, restrained by a pullback in demand for aircraft that overshadowed gains elsewhere. Bookings fell 1.5 percent after a revised 1.1 percent gain in February, figures from the Commerce Department showed today in Washington. The median projection of 61 economists in a Bloomberg News survey called for a 1.6 percent decline. Turbines and household appliances were among areas showing increases. The report comes a day after purchasing managers said manufacturing expanded in April at the fastest pace in almost a year as orders, production and employment picked up, indicating the slump may be short-lived. Exports and consumer spending on big-ticket items like automobiles may be making up for a cooling in business investment, which means factories will continue to support the expansion.
“Manufacturing is still leading the recovery,” said Gus Faucher, a senior economist at PNC Financial Services Group Inc. in Philadelphia, who correctly projected the drop in orders. “Businesses are going to continue to invest. The manufacturing sector is going to continue to expand.” Economists’ estimates in the Bloomberg survey ranged from a decline of 3 percent to little changed. The Commerce Department revised the February figure from a previously estimated 1.3 percent increase.

China Manufacturing Improvement Signals Growth Rebound (Source: Bloomberg)
A Chinese manufacturing index rose in April, signaling that a rebound in the world’s second-biggest economy may help to offset constraints on global growth from austerity measures in Europe. The 49.3 final reading of a purchasing managers’ index from HSBC Holdings Plc (HSBA) and Markit Economics today compares with a preliminary 49.1 reported April 23 and a final 48.3 in March. A separate index released yesterday by China’s statistics bureau and logistics federation was at 53.3, indicating the fastest growth in a year. Improvements in manufacturing may encourage Premier Wen Jiabao to extend a two-month pause in lowering banks’ reserve requirements as the effect of previous easing kicks in. Wen is seeking to rein in property and consumer prices without sending the economy into a so-called hard landing. Gross domestic product increased 8.1 percent last quarter from a year earlier, the least since 2009.
“Easing measures are starting to work,” said Qu Hongbin, Hong Kong-based chief economist for China at HSBC. China’s growth may “bottom out” this quarter and climb to an annual rate of more than 8.5 percent in the second half, Qu said.

Hong Kong Sells Land Below Estimates on Rising Supply (Source: Bloomberg)
Hong Kong’s government sold land in one of the city’s most exclusive areas for less than analysts estimated, underscoring developers’ concerns that increased housing supply and slowing global growth may stall home prices. The winning bid for the site in Repulse Bay, in the Island South district, was HK$1.67 billion, the government said in a statement yesterday. That’s equal to HK$39,673 ($5,114) a square foot, according to Centaline Property Agency Ltd., the city’s biggest closely held realtor. The site, with a total buildable area of 42,000 square feet, was expected to fetch HK$1.68 billion, or HK$40,000 a square foot, according to the median estimate of five analysts surveyed by Bloomberg News.
Leung Chun-ying, who in July will take over as Hong Kong’s new leader, has vowed to increase housing supply to quell public discontent over a widening wealth gap in the world’s most expensive place to buy a home. Hong Kong’s home prices have gained more than 78 percent since early 2009 on record low mortgage rates and an under-supply of new units.

Temasek Selling $2.4 Billion in BOC, China Construction (Source: Bloomberg)
Temasek Holdings Pte., Singapore’s state-owned investment company, sold $2.48 billion of shares in Bank of China Ltd. and China Construction Bank Corp. (939) less than a month after raising its holdings in their larger rival. Temasek received about $1.24 billion selling 3.1 billion Bank of China shares at HK$3.13 apiece, according to a term sheet obtained by Bloomberg News, a 4 percent discount from the close in Hong Kong yesterday. The firm also got a similar amount divesting 1.6 billion shares in China Construction Bank at HK$5.99 each, another document shows, 2.8 percent lower than the stock’s close yesterday. “Results for these banks have been pretty fair, given the operating environment, slower economy and higher interest rates,” said Jeff Papp, senior analyst at Oberweis Asset Management Inc. in Lisle, Illinois. “Maybe Temasek is taking a longer-term view and saying this is as good as it gets.”
The sales come less than a month after the Singapore firm purchased $2.3 billion of shares in China’s biggest lender Industrial & Commercial Bank of China Ltd. from Goldman Sachs Group Inc. Bank of China and Construction Bank’s Hong Kong- traded shares have risen 14 percent this year, compared with the 12 percent gain in the Bloomberg Asia Pacific Banks Index. (BPRBANK)

Indian Exports Shrank in March for First Time Since 2009 (Source: Bloomberg)
Indian exports fell in March as Europe’s debt crisis and slower Chinese growth hurt demand. Merchandise shipments dropped 5.7 percent from a year earlier to $28.7 billion, the government said in a statement in New Delhi today. Imports rose 24.3 percent to $42.6 billion, leaving a trade deficit of $13.9 billion. India’s trade deficit surged to a record $184.9 billion in the fiscal year ended March 31 as elevated crude oil prices stoked import bills and a struggling global recovery hurt exports. The rupee has slumped about 16 percent in the past year against the dollar as the trade gap widened, according to data compiled by Bloomberg. “The fragile global economy doesn’t augur well for Indian exports,” Rupa Rege Nitsure, an economist at state-owned Bank of Baroda (BOB) in Mumbai, said before the report. “The widening trade deficit and slowing economic growth pose significant risks to India’s macroeconomic stability.”

Euro Remains Lower on Prospects Draghi to Signal Stimulus (Source: Bloomberg)
The euro remained lower following a three-day decline on bets that European Central Bank President Mario Draghi will hint at further stimulus measures to counter the region’s debt crisis after today’s policy meeting. The 17-nation currency was 0.2 percent from a two-week low versus the yen before Spain auctions bonds. New Zealand’s dollar slid to the weakest since January after data showed the nation’s unemployment rate rose to the highest level since 2010. “There’s a very good chance that ECB President Draghi is going to be very dovish,” said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia. (CBA) “There’s potential there that demand for Spanish bonds is quite weak and that would, I expect, push the euro down as well.”
The euro was at $1.3148 as of 7:42 a.m. in Singapore after sliding 0.6 percent to $1.3158 in New York yesterday. It fetched 105.39 yen from 105.46 yesterday when it dropped to as low as 105.13, the least since April 16. The dollar traded at 80.16 yen from 80.14. Japan’s markets are shut today and tomorrow for public holidays.

King Says BOE Will Risk Unpopularity to Prevent Crises (Source: Bloomberg)
Bank of England Governor Mervyn King said central bank officials are prepared to take unpopular measures to prevent banking excesses from undermining financial stability and economic growth. “Our role will be to take away the punch bowl just as the next party is getting going,” King said in a BBC Radio address today in London. “That won’t make us popular among bankers, politicians and even at times some of you, and it’s not supposed to. But it will, I hope, reflect the trust and confidence that the citizens of this country can place in the Old Lady of Threadneedle Street,” a nickname for the central bank. As officials prepare for a decision next week on whether to extend their bond-buying program to lift the economy from its first double-dip recession since 1975, King said the economy isn’t yet “back to health” and needs the support of low interest rates. The governor, who will retire in June 2013, spoke days before the central bank marks 15 years of independence from government in setting monetary policy.
“We have a difficult challenge and our job is to do our best to try to steer the economy back onto a steady growth path,” he said in response to questions. “For the time being that means low interest rates.”

Sarkozy Struggles to Land Knock-Out Blow in Debate With Hollande (Source: Bloomberg)
President Nicolas Sarkozy struggled to make inroads against Socialist challenger Francois Hollande as the only debate in France’s presidential election descended into an exchange of insults and accusations. Behind in the polls with the clock ticking on his re- election bid, the incumbent repeatedly accused his rival of lying, while Hollande said his opponent showed he was being “disagreeable.” “It was a harsh debate,” said Frederic Dabi of the Ifop polling company. “Sarkozy sought to knock out Hollande and Hollande sought to weaken Sarkozy’s legitimacy and provoked him at the start.” The 170-minute encounter late yesterday was Sarkozy’s last chance to turn the tide against Hollande before the May 6 runoff. The challenger led with 53 percent to 47 percent, a survey by Ifop showed yesterday. There was no margin of error published.

Greeks Reveal Euro or No in First Election Since Downturn (Source: Bloomberg)
Alexandra Paschia’s toddler runs among the shoes marked down to 5 euros ($6.63) from 50 euros in their family-run store in Athens. The demise of Greece’s economy has spanned the life of the 2 1/2-year-old girl, and ensures there are no customers to bump into a week before elections. “This crisis has meant a 180-degree turn, a somersault in everyone’s lives, old, young, rich, poor,” says Paschia, 35, who will vote for the anti-immigrant Golden Dawn party instead of the two main parties of Pasok or New Democracy on May 6. “We need new, different voices in parliament.” For the first time since their country became the byword for the European debt crisis, Greeks will have their say at the ballot box rather than in street protests about the economic pain they are enduring for a third successive year in the battle to retain membership of the euro.
Faced with the prospect of more budget cuts to keep international funds flowing, many voters are backing small anti- bailout parties that promise an end to austerity measures. While polls show most people don’t want a return to the drachma, opponents warn that could tilt the balance in favor of rejecting the bailout terms and threaten Greece’s membership in the euro.

French Candidates Clash on How to Emulate Germany to Create Jobs (Source: Bloomberg)
French President Nicolas Sarkozy and Socialist Francois Hollande clashed in their only campaign debate over everything from how to emulate German employment gains and euro bonds to the role of the European Central Bank. In heated exchanges, marked by the candidates calling each other a liar, Sarkozy and Hollande elaborated on differences over how to rekindle growth with joblessness in France at the highest level in 12 years. Germany’s unemployment rate is 6.8 percent, against 9.8 percent in France. “Unemployment has increased,” Hollande said to Sarkozy. “In Germany they make room for social partners, unlike in France.” For his part, Sarkozy said, “after criticizing Germany, it suddenly inspires you.” He said Germany raised sales taxes to help finance lower social charges and unions backed a balanced budget rule that Hollande opposes.
The war of words between the two candidates came as Sarkozy fought for his last chance to turn the tide against Hollande before the May 6 runoff. The challenger led with 53.5 percent to 46.5 percent, according to a survey of voting intentions published by BVA today. There was no margin of error published.

Hollande Envoys Said to Brief ECB Officials on His Economic Plan (Source: Bloomberg)
Aides to French Socialist presidential candidate Francois Hollande have had contacts with top European Central Bank officials to brief monetary policy makers on his economic plans, four advisers to Hollande said. Hollande’s team has spoken to at least two members of the ECB’s executive board, said the advisers, who declined to be named because the discussions were confidential. An ECB spokeswoman denied any such contacts have taken place. She spoke on condition of anonymity, in line with ECB policy. The meetings and telephone conversations, which began last year and have carried on as Hollande’s campaign progressed, underscore concern that a change in government in Europe’s second-largest economy risks upsetting efforts to quell the region’s financial crisis. “Given the complexity of Europe’s problems, I would hate for a new government to come into a political vacuum,” said David Owen, chief European economist at Jefferies Securities International in London. “It’s reassuring.”

Euro-Area Unemployment at 15-Year High as Slump Deepens: Economy (Source: Bloomberg)
Euro-region unemployment rose to a 15- year high and manufacturing contracted for a ninth month, adding to signs the economic slump is deepening. The jobless rate in the 17-nation euro area increased to 10.9 percent in March from 10.8 percent in February, the European Union statistics office in Luxembourg said today. That’s the highest since April 1997, according to Bloomberg News data. Separate reports showed euro-area manufacturing contracted more than initially estimated in April and unemployment in Germany, the region’s largest economy, unexpectedly increased. Rising joblessness will keep pressure on politicians to find ways of boosting growth as austerity measures designed to stem the debt crisis push economies into recession and provoke a backlash among citizens. European Central Bank President Mario Draghi last week called on leaders to create a “growth compact” to complement an agreement on fiscal rules. The ECB will probably keep its benchmark interest rate at a record low of 1 percent tomorrow.
“The grim unemployment figures for March will likely encourage talk about a long overdue ‘growth pact’ for the euro zone,” said Martin van Vliet, an economist at ING Group in Amsterdam. “Survey measures of hiring intentions point to further increases in unemployment over the coming months, so we would expect unemployment to breach the 11 percent threshold.”

German Jobless Unexpectedly Up in April as Crisis Flared (Source: Bloomberg)
German unemployment unexpectedly rose in April as the debt crisis in the euro area constrained growth and hiring in Europe’s biggest economy. The number of people out of work increased a seasonally adjusted 19,000 to 2.87 million, the Federal Labor Agency in Nuremberg said today. Economists forecast a decline of 10,000, the median of 34 estimates in a Bloomberg News survey shows. The adjusted jobless rate was unchanged at 6.8 percent, still a two- decade low, after the agency revised up figures for February and March. “The labor market has entered a period of stabilization at a high level,” said Carsten Brzeski, an economist at ING Group in Brussels. While “the economic tailwind from the last two years is clearly fading away,” it is “not yet a cause for concern” and so far underscores that the labor market is an indicator that lags behind economic developments.
German unemployment has been the biggest advertisement for Chancellor Angela Merkel’s prescription to quell the debt crisis with budget cuts and labor-market changes as part of an economic overhaul. Separate European figures published by the Luxembourg- based statistics agency Eurostat today showed euro-region unemployment rose to 10.9 percent in March, the highest in almost 15 years and almost double Germany’s rate of 5.6 percent.

Euro Remains Lower on Prospects Draghi to Signal Stimulus (Source: Bloomberg)
The euro remained lower following a three-day decline on bets that European Central Bank President Mario Draghi will hint at further stimulus measures to counter the region’s debt crisis after today’s policy meeting. The 17-nation currency was 0.2 percent from a two-week low versus the yen before Spain auctions bonds. New Zealand’s dollar slid to the weakest since January after data showed the nation’s unemployment rate rose to the highest level since 2010. “There’s a very good chance that ECB President Draghi is going to be very dovish,” said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia. (CBA) “There’s potential there that demand for Spanish bonds is quite weak and that would, I expect, push the euro down as well.”
The euro was at $1.3148 as of 7:42 a.m. in Singapore after sliding 0.6 percent to $1.3158 in New York yesterday. It fetched 105.39 yen from 105.46 yesterday when it dropped to as low as 105.13, the least since April 16. The dollar traded at 80.16 yen from 80.14. Japan’s markets are shut today and tomorrow for public holidays.

N.Z. Central Bank Rules May Curb Interest Rate, Dollar Pressures (Source: Bloomberg)
New Zealand’s central bank will use new banking rules to help contain interest rate and currency pressures, the Deputy Governor said today. The so-called macro-prudential policy “will have an important influence on monetary policy, in a similar way to fiscal policy,” Grant Spencer said in e-mailed notes of a speech in Auckland today. The Reserve Bank of New Zealand wants to strengthen the nation’s financial system after learning prudential lessons from the global financial crisis, Spencer said. As well as tightening liquidity requirements, the new rules seek to combat credit booms and protect the economy from bank failures. “Such policies will also tend to have the effect of either dampening the credit cycle or dampening international capital flows and hence exchange rate pressures,” Spencer said.
The central bank is to increase the core funding ratio, which determines how much of lending must be funded by retail deposits and long-term borrowing, to 75 percent from Jan. 1, 2013, Spencer said. It originally planned to raise the ratio from 70 percent in June, deferring the increase last year because of global turmoil.

20120503 1007 Global Commodities Related News.

Market Recap: Wheat Futures (Source: CME)
Wheat futures were the downside leader in the grain markets today, ending 20-plus cents lower at all three exchanges. Futures closed near session lows. Strength in the U.S. dollar index weighed on wheat futures, with investors' concerns heightened about the euro-zone slipping deeper into recession due to disappointing manufacturing data.

Wheat Market Recap Report (Source: CME)
July Wheat finished down 28 1/2 at 614 1/2, 27 1/4 off the high and 2 3/4 up from the low. December Wheat closed down 26 at 653 3/4. This was 2 1/2 up from the low and 24 off the high. July wheat opened slightly lower and closed sharply lower on the day with aggressive fund selling noted late in the day. The market experienced the lowest close since September 14th of 2009. Traders see very high yield potential for the winter wheat crop and the weather outlook suggests improving crop conditions ahead. A strong US dollar and weakness in energy, metal and equity markets added to the bearish tone. Crop tour participants in Kansas see record yield potential and the spring wheat crop is off to an excellent start. July KC wheat took out the April lows to move to a new low for the move. Minneapolis July wheat fell sharply and pushed to the lowest level since November 26th of 2010. Iran bought 60,000 tonnes of wheat from Australia and Lebanon is tendering for 50,000 tonnes of milling wheat. July Oats closed down 8 at 337 1/4. This was 1/2 up from the low and 9 1/4 off the high.

Record yield potential forecast on Kansas wheat tour
COLBY, Kansas, May 1 (Reuters) - Wheat yields in northern and central Kansas showed potential for record yields after a mild winter pushed the crops out of dormancy early, which should bring forward the harvest by as much as three weeks, crop scouts on an annual tour found on Tuesday.
But the areas scouted on the first of three days of the tour are not in the biggest production regions in Kansas, the top wheat growing state, and scouts expect to see signs of drought and crop stress when the tour turns into southern and western Kansas.

U.S. wheat sale to Saudi Arabia first in 8 months
By Thomson Reuters - Wed 02 May 2012 09:34:12 CT
The U.S. government on Tuesday confirmed the sale of 110,000 tonnes of hard red winter wheat to Saudi Arabia, its first U.S. wheat purchase in eight months. The sale was part of a 440,000-tonne purchase announced on Sunday by the kingdom's Grain Silos & Flour Mills Organization from numerous origins for shipment from July to September.

Market Recap: Corn Futures (Source: CME)
May and July corn futures ended 17 1/2 cents lower, the September contract was 11 cents lower and new-crop contracts were around 7 cents lower. Corn futures closed low-range, but off session lows. Funds were active sellers today, dumping an estimated 18,000 contracts (90 million bu.) of corn. Corn futures were pressured throughout the day by a combination of corrective trade, strong planting progress, favorable weather and outside markets.

Corn Market Recap for 5/2/2012 (Source: CME)
July Corn finished down 17 1/2 at 611 1/2, 17 1/2 off the high and 1 1/2 up from the low. December Corn closed down 7 3/4 at 531. This was 2 3/4 up from the low and 9 off the high. July corn closed sharply lower on the session as fund traders selling intensified late in the day. A bearish weather outlook, continued talk of higher yield potential for the new season and a sharp set-back in wheat were all factors to spark long liquidation selling in corn again today. Once again, traders are indicating that US corn is expensive to wheat, Argentina corn and Brazil corn. In addition, there is talk that the Brazil corn crop could be higher than expected for next week's USDA update. Extra corn was planted after the first soybean crop came in below expectations and early. Private exporters reported the sale of 130,000 tonnes of US corn to unknown destination for the 2012/13 season. South Korea bought 58,000 tonnes of corn. Ethanol production for the week ending April 27th averaged 894,000 barrels per day. This is up 3.3% vs. last week and up 2.17% vs. last year. Total Ethanol production for the week was 6.258 million barrels. Corn used in last week's production is estimated at 95.2 million bushels. Corn use needs to average 94.2 million bushels per week to meet the USDA projection. Stocks were 22.2 million barrels. This is up 1.7% vs. last week and up 12.4% vs. last year. July Rice finished down 0.165 at 14.855, 0.155 off the high and equal to the low.

Corn Products 1st-qtr profit beats Street estimates
By Thomson Reuters - Wed 02 May 2012 09:41:13 CT
Corn Products International Inc  posted a first-quarter profit that beat analysts' estimates, helped by higher sales in North America and Asia Pacific.

Corn falls for 2nd day on crop prospects
By Thomson Reuters - Wed 02 May 2012 09:31:41 CT
Chicago corn futures fell for a second day, weighed down by speedy U.S. planting which has boosted prospects of above-average yields and early crop output replenishing tight old-crop supplies. "Crop conditions across the United States are certainly favourable at this stage," said Luke Mathews, commodities strategist at Commonwealth Bank of Australia.

Philippines to finalise 120,000T rice import deal in May
MANILA, May 2 (Reuters) - The Philippines will in the next three weeks choose Cambodia, Thailand or Vietnam to supply up to 120,000 tonnes of rice it needs to boost its buffer stocks, a senior government official said on Wednesday.
The country's state grains procurement agency said last month it would import the rice to deepen its reserves before the lean harvest season begins in July, with rice producers in its Southeast Asian neighbours eagerly awaiting a decision.

SOFTS-Cocoa near 5-week high, sugar above 11-month low
LONDON, May 2 (Reuters) - ICE cocoa futures consolidated in early trade after a rally on Tuesday, while raw sugar eased to stand above an 11-1/2-month low, pressured by a firmer dollar and expectations of a big global supply surplus.  Cocoa futures firmed, and stood below Tuesday's five-week high, basis second month, after soaring due to short covering on Tuesday. Cocoa futures have moved higher in a corrective bounce from Monday's 7.1 percent tumble on month-end technical sales.

Ghana's Cocobod probes 70,000 t discrepancy-official
LONDON/ACCRA, May 1 (Reuters) - Ghana's cocoa regulator Cocobod is investigating a shortfall of around 70,000 tonnes of beans between official cocoa purchases and its inventory after buyers reported inflated volumes, a Cocobod official told Reuters.
A fall in cocoa output in the world's second largest producer, combined with tight credit conditions, could have contributed to local buyers overstating cocoa purchases in order to gain advance funding - bruising Cocobod's reputation for being a low risk loan recipient.

India's Oct-April sugar output up 11 pct y/y-industry
NEW DELHI, May 2 (Reuters) - India produced 25.1 million tonnes of sugar between October and April, up 11 percent from the year-ago period, a sugar producers' body said in a statement on Wednesday.
The Indian Sugar Mills Association (ISMA) said the western state of Maharashtra produced 8.8 million tonnes, northern state of Uttar Pradesh 6.9 million tonnes, and southern Karnataka state 3.7 million tonnes.

China imports to drive world cotton trade-ICAC
May 1 (Reuters) - China will account for more than half of global cotton imports in 2011/12, driving world cotton trade up 13 percent for the year, an international farm group said on Tuesday.
The International Cotton Advisory Committee secretariat said in a monthly report that the boost in Chinese imports will more than double its cotton stocks to 5 million tonnes in 2011/12, and shipments from India, Brazil and Australia could reach record levels.

Egypt 2012/13 sugar imports seen down - US attache
May 1 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in Egypt:
"In 2012/2013 total sugar imports are forecast at 1.15 million tonnes compared to 1.43 million tonnes in MY 2011/2012. The decrease in imports is due to relatively high 2011/2012 ending stocks totaling 350,000 tonnes. Consumption is expected to increase to 2.95 million tonnes based largely on population growth."

Euro Coal-DES hits fresh 2-yr low at $90.50/T
LONDON, April 30 (Reuters) - European prompt physical coal prices slid $2.50 a tonne to a new two-year low of $90.50 a tonne on Monday, pushed down by weak fundamentals.
A June DES ARA cargo traded at $90.50 early on Monday, down  from the previous trade last week at $93.15.

Supply glut drives Europe coal prices to 2-year lows
LONDON, May 1 (Reuters) - European coal prices slumped to a two-year low on Tuesday with market players citing growing oversupply as large shipments from the United States and Colombia aggravated a glut in the region after an unusually warm winter.
Prices fell despite healthy use by power generators in countries including Germany, where profitability of power generation from coal now stands at the highest levels since 2008 compared with more expensive natural gas.

Asia fuel oil market may be too relaxed
--Clyde Russell is a Reuters market analyst. The views expressed are his own.--
LAUNCESTON, Australia, May 2 (Reuters) - While the potential loss of Iranian crude is keeping the oil market on its toes, traders seem to be relaxed about the impact on other parts of the barrel, with Asian fuel oil particularly at risk.
The discount of benchmark 180 centistoke fuel oil in Singapore to Dubai crude  has widened 21 percent in the past week to $4.68 a barrel.
The reason cited by traders is the build up in onshore inventories in the city state to a two-week high of 19.231 million barrels, as well as expected heavier imports from Europe in coming months.

OIL-Oil slips on European manufacturing data
LONDON, May 2 (Reuters) - Oil eased on Wednesday, as weak economic data in Europe hit the demand outlook, countering more positive figures from China and the United States.
"It does feel a bit like we are in a negative death spiral," said Bjarne Schieldrop, chief commodity strategist at SEB in Oslo. "Austerity

Taiwan CPC offers first 1 pct sulphur gasoil vols -trade
SINGAPORE, May 2 (Reuters) - Taiwan's CPC has offered gasoil with one percent sulphur content for the first time, ahead of a refinery unit maintenance, traders said on Wednesday.  
The refiner has offered 250,000-300,000 barrels of the high sulphur gasoil grade for June lifting in a tender closing on May 3. Bids will be valid until May 4.  

Russia's April oil output edges down 0.3 pct
MOSCOW, May 2 (Reuters) - Russian oil output declined 0.3 percent to 10.33 million barrels per day (bpd) in April from 10.36 million bpd in March, falling to its lowest monthly output this year, Energy Ministry data showed on Wednesday.
In each of previous months this year, oil output reached a post-Soviet monthly high.

Myanmar eyes oil, gas tender in August
SINGAPORE, May 2 (Reuters) - Myanmar may launch a global tender for onshore oil and gas blocks in August, a senior government official told Reuters on Wednesday, inviting foreign firms to invest millions of dollars for access to untapped resources in the fast-changing Southeast Asian nation.
Myanmar, one of the world's oldest oil producers, has opened up to the outside world with astonishing speed since a civilian government took office a little over a year ago. The prospect of the end of Western sanctions has prompted a surge of interest from investors.

Brazil won't weaken oil regs for foreign investors
HOUSTON, May 1 (Reuters) - Brazil has the world's best safety record for oil company operations, despite recent offshore spills, and will enforce its rules even at the risk of diminished foreign investment, the country's energy agency director said on T ues day.
"Brazil has the lowest incidence of accidents in the whole world. Brazil has a very strong regulator," Magda Chambriard, director of Brazil's energy agency, ANP, said in an interview on the sidelines of the Offshore Technology Conference.

Oil Fluctuates After Biggest Drop in Two Weeks on Stockpile Gain (Source: Bloomberg)
Oil traded little changed after sliding the most in two weeks in New York as crude stockpiles surged to the highest level in more than 21 years in the U.S., the world’s biggest consumer of the commodity. Futures fluctuated after slipping 0.9 percent yesterday. Crude inventories increased 2.8 million barrels last week to 375.9 million, the most since September 1990, according to the Energy Department. Prices also dropped as U.S. employers added fewer jobs than forecast and factory orders fell. Crude for June delivery was at $105.39 a barrel, up 17 cents, on the New York Mercantile Exchange at 9:03 a.m. Sydney time. The contract yesterday slid 94 cents to $105.22, the lowest close since April 30. Front-month prices are 6.7 percent higher this year. Brent oil for June settlement decreased $1.46, or 1.2 percent, to $118.20 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark contract’s premium to West Texas Intermediate closed at $12.98.

Barrick Leads Miners Spending Faster Than Earnings Rise (Source: Bloomberg)
Capital spending by the largest gold producers is increasing at a faster pace than earnings for a second straight year as the industry’s biggest mining projects are beset by delays and surging labor costs. Barrick Gold Corp. (ABX) said yesterday it’s reviewing cost estimates for its $5 billion Pascua-Lama gold and silver project on the Chile-Argentina border because of wage and raw-materials inflation. Newmont Mining Corp. (NEM) may have to raise the $4.8 billion budget for its Conga mine in Chile after political opposition. The two gold miners are building the multibillion-dollar mines to arrest a decline in production and end the underperformance of their shares relative to the commodity they produce. Escalating costs may mean producers reassess other proposed projects, according to Jorge Beristain, an analyst at Deutsche Bank AG.
“The growth-at-any-cost route, I think, is the wrong way to go,” George Topping, a Toronto-based analyst at Stifel Nicolaus & Co., said in an interview. “The only people that are making money off building these new mines are the employees, the government, contractors. The shareholders aren’t actually getting any of the rewards here.”

Iron Ore-Spot steady as China weighs demand outlook
SINGAPORE, May 2 (Reuters) - Spot iron ore prices were mostly steady on Wednesday as Chinese markets reopened after a long holiday weekend with buyers opting for caution amid a still shaky outlook for steel demand.
Shanghai rebar steel futures  also hovered at levels where they closed last week, giving Chinese producers less impetus to pick up fresh iron ore cargoes.

India to supply 2 mln T of iron ore to Japan annually-min
NEW DELHI, April 30 (Reuters) - India has agreed to supply 2 million tonnes of iron ore per year to Japan under an extension of an earlier agreement, Trade Minister Anand Sharma said on Monday.
India, once the world's third-biggest supplier of iron ore, has lost its pricing advantage due to high export taxes and freight costs, making the steel-making ingredient from Australia and Brazil cheaper.

Gold Falls a 3rd Day on Speculation Stimulus Not Needed (Source: Bloomberg)
Gold declined the most in a week after three voting members of the Federal Open Market Committee said they don’t see a need for more economic stimulus and as physical demand slumped in India, the world’s biggest importer. John Williams, president of the San Francisco Fed, joined his counterparts from Richmond, Philadelphia and Atlanta in casting doubt on the need for additional purchases of bonds to push down longer-term interest rates even as American employers added fewer jobs than forecast. India imported 30 to 35 metric tons of gold in April, down from 90 tons a year earlier, the Bombay Bullion Association said today. “The market is clearly worried,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview. “The physical demand has also been very weak.”
Gold futures for June delivery fell 0.5 percent to settle at $1,654 an ounce at 1:41 p.m. on the Comex in New York, the biggest drop for a most active contract since April 23. Prices declined for the past three months, the longest losing streak since 2001. Companies in the U.S. added 119,000 workers in April, according to figures from Roseland, New Jersey-based ADP Employer Services. The median forecast of economists surveyed by Bloomberg News called for a 170,000 advance.

Baltic sea index drops on tepid trade
May 1 (Reuters) - The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry commodities, fell on Tuesday for a second straight day as labour holidays led to a subdued market and analysts expected rates to be flat over this week.
The overall index, which reflects the daily freight market prices for capesize, panamax, supramax and handysize dry bulk transport vessels, fell three points or 0.26 percent to 1,152 points.

20120503 1006 Soy Oil & Palm Oil Related News.

Market Recap: Soybean Futures (Source: CME)
July soybean futures posted a key bearish reversal today, rallying to a new contract high and then promptly caving to sellers. Other contracts also faced heavy selling heading into the close and finished 17 3/4 to 29 1/2 cents lower. Nearby contracts’ rally to new highs triggered a round of profit taking. Also encouraging this was CME’s late announcement that it will alter its initial margin requirements as of May 7.

Soybean Complex Market Recap (Source: CME)
July Soybeans finished down 18 1/2 at 1485, 27 1/2 off the high and 4 up from the low. November Soybeans closed down 24 1/4 at 1368 1/4. This was 5 3/4 up from the low and 26 1/4 off the high. July Soymeal closed down 4.5 at 429.7. This was 1.4 up from the low and 7.9 off the high. July Soybean Oil finished down 0.2 at 54.71, 0.78 off the high and 0.1 up from the low. July soybeans pushed to a new contract high of 1512 1/4 before closing down 18 1/2 cents on the day at 1485. The reversal after taking out the range of the past three trading sessions is seen as a negative technical development. The outlook for good moisture in the next 10 days across much of the plains and Midwest plus continued talk of the overbought condition of the market helped to pressure early in the session. However, buyers emerged on the early set-back for old crop soybeans to help support the market above yesterday's lows and the buying continued into the mid-session to drive July soybeans to moderately higher on the day and to a new high for the move. The sharp break in wheat, and then corn due to the weather impact eventually attracted a long liquidation selling trend in soybeans to drive the market sharply lower into the close. Private exporters reported the sale of 204,000 tonnes of US soybeans to unknown destination for the 2012/13 season. In addition, China bought 30,000 tonnes of US soybean oil for the 2011/12 season. News of more buying from China helped spark a strong move higher in the soybean oil market to support the rally before selling emerged to push the market lower into the close. A lack of deliveries and talk that the tightening supply of meal from South America will boost demand for US meal helped drive July meal to a new high for the move but the reversal and lower close is seen as a negative technical development.

China set to buy even more U.S. soy -Oil World
By Thomson Reuters - Wed 02 May 2012 09:40:00 CT
China is likely to buy even more U.S.-origin soybeans in the near term because of poor South American crops, Hamburg-based oilseeds analysts Oil World said on Tuesday.

Malaysia's palm tax policy may come after $3 bln IPO
SINGAPORE, May 2 (Reuters) - Malaysia's policy response to Jakarta's lower export tax for refined palm oil, which has shifted orders away to Indonesia, may come after the government lists its plantation assets in a $3 billion IPO, said top industry analyst Dorab Mistry.
Malaysia has struggled to formulate a response to the new tax regime since it came into force in September, allowing Indonesian refiners to export at a sizable discount and grab market share.  

ADM official says it will be hard to buy US soybeans
By Thomson Reuters - Wed 02 May 2012 09:36:38 CT
Archer Daniels Midland Co  is "very concerned" about the potential for low U.S. soybean supplies due to a shift toward corn plantings, said Craig Huss, chief risk officer. Farmers are expected to increase corn plantings to a 75-year high this spring to take advantage of high prices, and to plant fewer acres of soybeans than last year, according to U.S. government estimates.

Palm oil slips on higher output view
By Thomson Reuters - Wed 02 May 2012 09:35:18 CT
Malaysian palm oil futures edged lower, as expectations of higher production offset strong exports and an uptick in global economic activity. "Exports were strong but that is not the only factor. When exports were down 15 percent in the middle of April, the market also didn't respond very strongly," said James Ratnam, an analyst with TA Securities in Malaysia.

Canada canola sector aims for China breakthrough
WINNIPEG, Manitoba, May 1 (Reuters) - The Canola Council of Canada is working to convince China to scrap its trade restrictions against the oilseed, Canada's most profitable crop, and is hoping for a breakthrough this year, the organization's new head said on Tuesday.
Canadian government and trade officials have made frequent visits to China, and the Canola Council is wrapping up a joint research program to address China's concerns about the spread of the fungal disease blackleg in its domestic growing areas.