Thursday, June 28, 2012

20120628 1804 FCPO EOD Daily Chart Study.

FCPO closed : 2998, changed : -18 points, volume : higher.
Bollinger band reading : correction range bound little downside biased.
MACD Histogram : weakening,  buyer seller battling.
Support : 2970, 2950, 2920, 2900 level.
Resistance : 3020, 3050, 3070, 3100 level.
Comment :
FCPO closed weaker with better volume changed hand. Soy oil price currently trading lower after overnight closed recorded gains while crude oil price currently retreating lower after overnight surge above $80 per barrel level.
Price still trading weaker as traders decided to stay sideline avoiding exposure awaits EU Summit meeting, uncertain weather factor and Friday USDA report.
Technical chart wise, reading adjusted to calling a correction range bound little downside biased market development.
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.

20120628 1734 FKLI EOD Daily Chart Study.

FKLI closed : 1592 changed : -12 points, volume : lower.
Bollinger band reading : correction range bound upside biased.
MACD Histogram : weakenning, buyer taking profit.
Support : 1590, 1580, 1570, 1565 level.
Resistance : 1600, 1610, 1620, 1630 level.
Comment :
FKLI closed recorded loss snapping back yesterday gains with lesser volume transacted doing 2 points discount compare to cash market that closed lower. Overnight U.S. markets firmer and today Asia markets ended mixed while European markets currently trading lower.
Global market reacted differently on uncertainty ahead of 2 day EU summit meeting and news on better than estimated U.S. home sales and durable goods order data. Back home, Felda Global Ventures debut recorded good performance after closed 16.5% higher(at least much better than FACEBOOK) failed to lead local cash and futures market higher.
Daily chart analysis adjusted to suggesting a correction range boung upside biased market development.
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.

20120628 1708 Regional Markets EOD Daily Chart Study.

 DJIA chart reading : correction range bound little upside biased.
 Hang Seng chart reading : correction range bound little upside biased.
KLCI chart reading :  correction range bound upside biased.

20120628 1649 Global Market & Commodities Related News.

Asian shares rose while European stock index futures looked set for a higher open, although gains and volumes could be limited ahead of a summit of European Union leaders that looks unlikely to produce any significant measures to tackle the region's debt crisis. U.S. stocks rose on Wednesday as stronger-than-expected economic data helped lift energy stocks, overshadowing concerns a European Union summit will not yield tangible progress in easing the debt crisis.

The euro bounced off a three-week low against the U.S. dollar  on short-covering ahead of a European Union summit starting later in the day and also helped by expectations of more monetary support from the European Central Bank.

FOREX-Euro bounces back ahead of EU summit, ECB hopes help
TOKYO, June 28 (Reuters) - The euro bounced off a three-week low against the U.S. dollar on Thursday on short-covering ahead of a European Union summit starting later in the day and also helped by expectations of more monetary support from the European Central Bank.
While many market players expected European leaders to struggle to agree on bold steps to solve the region's debt crisis at their summit, some market players were playing it safe by squaring their positions just in case there would be a surprise breakthrough.

Chicago new-crop corn rose for a fifth consecutive session  to around a nine-month top, while soybeans edged higher as hot and dry weather curbed yields in the U.S. Midwest, threatening to squeeze global supplies.

Rain curses early stages of Brazil coffee harvest
Unseasonably wet weather has spoiled much of the first arabica coffee being harvested in Brazil and put the futures market on edge, but dryness now returning to the coffee belt has averted damage to the bulk of the crop, which has yet to be picked.

Scorching heat forecast for struggling US corn, soy
A heat wave, with highs that could top 100 degrees Fahrenheit, is forecast for the southern U.S. Midwest this week and next week, which should put more stress on corn and soybean crops, agricultural meteorologists predicted Wednesday.

Valero idles Linden, Indiana, ethanol plant on corn prices
Valero Energy Corp idled its second ethanol plant in Linden, Indiana on Tuesday, as tight corn supplies continue to drive up prices, a company spokesman said on Wednesday.

Uganda sugar producer says to double output by 2015
Uganda's third largest sugar producer, Sugar Corporation of Uganda Ltd. (SCOUL), aims to double its output by 2015 after securing a $23 million loan from a French financing firm, it said on Wednesday.

Brent crude stayed above $93 per barrel  after rallying on an output cut by Norway and positive economic data from the United States, while investors eyed a summit of EU leaders that is unlikely to produce concrete measures to contain the bloc's protracted debt crisis.

US crude stocks fall slightly; fuel stocks mixed
U.S. crude oil stocks fell slightly last week on a dip in crude imports and increased refining rates, while fuel stockpiles were mixed as gasoline inventories rose and distillates fell, government data showed on Wednesday.    

Venezuela wants OPEC price band restored
Venezuela wants OPEC to set an oil price band of $80 to $120 a barrel to stem crude's recent tumble, seeking to revive a policy the cartel scrapped seven years ago.

France mulling one-off tax on oil sector
France is considering a one-off tax on the oil sector before the end of 2012 that would raise around 500 million euros ($623.55 million), helping depleted French coffers but hurting its struggling refining industry.

Japan's May imports of Indonesia nickel ore jump
Japanese imports of nickel ore from Indonesia jumped 80 percent from a year earlier in May, government data showed on Thursday, as importers rushed to buy ahead of curbs on shipments by key suppliers in the Southeast Asian nation.

Iron price system unlikely to change soon-Vale
SAO PAULO, June 27 (Reuters) - Changes in the pricing system for iron ore are unlikely so long as the market remains volatile, a senior executive at the world's top producer of the mineral said, signaling that miners will resist pressure from steelmakers to settle supply contracts for longer periods.
"So long as this price volatility persists, it is really hard to implement pricing systems for longer periods of time," said José Carlos Martins, head of ferrous minerals at Brazil's Vale . Such volatility is caused by Chinese clients' efforts to bargain-hunt for the mineral "all the time."

EU, US, Japan seek WTO steps on China rare earths
BRUSSELS, June 27 (Reuters) - The European Union, the United States and Japan on Wednesday requested a dispute settlement panel at the World Trade Organization (WTO) after failing to resolve a battle over China's export restrictions on rare earth minerals.
The move followed a complaint the three trade powers took to the WTO in March, the first they have launched jointly, and comes amid a series of clashes with China over economic issues, including the value of the Chinese currency.

Australia says iron ore exports to maintain rapid growth
Australia, the world's biggest producer of iron ore, on Wednesday stuck to a forecast for a 10 percent rise in exports in the next fiscal year, as mining companies spend billions of dollars beefing up operations to meet demand from China.

London copper rose for a fourth consecutive session, with investors cheered by encouraging U.S. economic data, but an EU summit later on Thursday could limit gains, as markets fret over the bloc's divisions on how to fight and subdue its debt crisis.

Gold edged up  after the euro showed some resilience ahead of a European Union summit that is unlikely to deliver new measures to tackle the region's debt crisis and may prompt investors to turn to the safety of the U.S. dollar.

METALS-Copper gains on U.S. data, EU summit eyed
SHANGHAI, June 28 (Reuters) - London copper rose for a fourth consecutive session, with investors cheered by encouraging U.S. economic data, but an EU summit later on Thursday could limit gains, as markets fret over the bloc's divisions on how to fight and subdue its debt crisis.
Three-month copper on the London Metal Exchange  was up 0.3 percent at $7,427 per tonne by 0536 GMT, in its fourth straight daily rise, after a gain of 0.6 percent in the previous session.

PRECIOUS-Gold inches up ahead of European Union summit
SINGAPORE, June 28 (Reuters) - Gold edged up on Thursday after the euro showed some resilience ahead of a European Union summit that is unlikely to deliver new measures to tackle the region's debt crisis and may prompt investors to turn to the safety of the U.S. dollar.
Gold has lost some of its safe-haven appeal after financial  market turmoil caused by the prolonged debt crisis in Europe and the U.S. Federal Reserve's decision to take only a modest step to boost the economy forced investors to cash in bullion to cover losses.

20120628 1116 Global Market & Commodities Related News.

GLOBAL MARKETS-Shares edge up, euro vulnerable on divided EU summit
TOKYO, June 28 (Reuters) - Asian shares rose on encouraging U.S. economic data, but prices could falter with markets tense ahead of a European summit deeply divided on how to tackle the protracted euro zone debt crisis and stop it spreading further.
"This triumph of optimism is conditional on Europe delivering something and the Italian bond auction not being a disaster," said Sebastien Galy, strategist at Societe Generale.

COMMODITIES-Broad rally on US data; Norway strike lifts oil
NEW YORK, June 27 (Reuters) - Commodity markets rallied broadly o n W ednesday as destructive crop weather, encouraging U.S. economic data and an oil workers' strike in Norway lifted prices despite worries about the euro zone crisis.
"You just have some positioning ahead of this EU Summit," Matthew Zeman, head of trading at Kingsview Financial in Chicago, said in reference to the broad commodities rally.

OIL - Oil tops $93 on Norway strike, drop in US crude stocks
NEW YORK, June 27 (Reuters) - Crude oil futures rose on W ednesday as tighter North Sea supplies and strong U.S. economic data put on the back burner concerns that a European summit would do little to solve the region's debt crisis.
"U.S. crude drew support from the stronger-than-expected durable goods orders and firmer S&P 500 that called attention away from worries about the apparent lack of agreement among European leaders ahead of the June 28-29 summit," said Tim Evans, energy analyst at Citi Futures Perspective in New York.  

US crude stocks fall slightly; fuel stocks mixed
U.S. crude oil stocks fell slightly last week on a dip in crude imports and increased refining rates, while fuel stockpiles were mixed as gasoline inventories rose and distillates fell, government data showed on Wednesday.    
Domestic stocks of crude, excluding oil held in the Strategic Petroleum Reserve, fell 133,000 barrels to 387.17 million barrels in the week to June 22, the Energy Information Administration reported.

US should be open to crude oil exports-EIA head
WASHINGTON, June 27 (Reuters) - The United States should be open to exporting domestically produced crude oil, the head of the Energy Information Administration said on Wednesday, arguing that such exports could actually benefit the U.S. economy.
Adam Sieminski, the former Deutsche Bank economist who was sworn in as EIA administrator earlier this month, said selling U.S. oil abroad could help provide a market for light sweet crude produced from shale formations in places like North Dakota, since the Gulf coast refining hub is more suited to process heavier crudes.

Japan's May Iran crude imports slide ahead of sanctions
TOKYO, June 28 (Reuters) - Japan's crude imports from Iran almost halved in May from a year ago as refiners in the world's third-largest economy lifted less oil in advance of an EU ban on insurance for shipments from the Middle Eastern country that goes into effect on Sunday.
Customs-cleared imports of oil from Iran fell 46.5 percent in May from a year earlier to 106,162 barrels per day (523,233 kilolitres), data from Japan's Ministry of Finance showed on Thursday. They fell 7.4 percent from 118,450 bpd in April.

Iran acknowledges oil exports down 20-30 pct
MOSCOW, June 27 (Reuters) - Iran acknowledged for the first time on Wednesday that its oil exports have fallen sharply, down 20-30 percent from normal volumes of 2.2 million barrels daily.
A National Iranian Oil Company official in Moscow denied exports had been hit by sanctions against Iran's nuclear programme, saying that oilfields were under maintenance and crude production was being diverted for refining.

EU's oil refiners face carbon double-whammy
LONDON, June 27 (Reuters) - European oil refiners could be doubly disadvantaged by EU plans to make them pay for some of their carbon emissions from January 2013 due to rising competition from cheap foreign imports and non-European-owned refiners inside the EU.
Struggling EU refiners are already worried that moves to make them pay for carbon emission credits from Jan. 1, 2013 will put them at an operational cost disadvantage to refineries outside the EU.

NATURAL GAS - US July gas futures off highs but expire with gains
NEW YORK, June 27 (Reuters) - U.S. natural gas futures ended higher on Wednesday for a fifth straight session, with warm U.S. forecasts for the next two weeks driving July to a 5-1/2 month high before profit-taking brought the contract off the intraday high ahead of expiration.
"The market rallied hard today, then sold off into the close on some profit taking. I think prices got a little overbought at higher levels," a New England-based trader said.

EURO COAL-S.African tightness boosts prices by $1/T
LONDON, June 27 (Reuters) - Prompt South African FOB physical coal prices rose by around $1.00 on Wednesday as traders bought to cover short positions amid tight supply for July and August cargoes. Supply is extremely tight for July, you can't find anything from South Africa, nobody is willing to sell and August is looking like it'll be just as tight," one European trader said.

20120628 1008 Malaysia Corporate Related News.

Masteel signs RM500m deal with Trafigura
Malaysia Steel Works (KL) Bhd (Masteel) yesterday signed a RM500m three-year off take agreement with Trafigura Pte Ltd, the world’s second largest independent trader of bulk and non-ferrous minerals. Masteel in a statement said the deal would see Trafigura purchase steel billets and steel bars from Masteel over a period of three years, commencing from 2H of 2012. (Financial Daily)

MHB clinches RM278m Sarawak Shell contract
Malaysia Marine and Heavy Engineering Holdings (MHB) has clinched the F14/F29 project, comprising three structures with a combined contract value of RM278m, from Sarawak Shell. With the addition of F14/F29 topsides, substructures and process module contract, the company will have two projects fabricated simultaneously at its MHB West Yard in Pasir Gudang, Johor – the other being the Gumusut-Kakap floating production system, MHB managing director and CEO Dominique de Soras said in a statement. (Financial Daily)

Maxis signs strategic partnerships to deliver IPTV service
Maxis yesterday signed new strategic partnerships with 14 content providers to deliver the Internet protocol television (IPTV) service in Malaysia. The content partnerships will enable Maxis, an integrated communications service provider, to deliver on-demand movies and series, including high definition and 3D content as well as seven free-to-air channels to its customers anytime and anywhere. (Financial Daily)

Boustead buys LTAT's 97% stake in Johan Ceramics
Boustead Holdings is acquiring a 97.1% stake in Johan Ceramics from Lembaga Tabung Angkatan Tentera (LTAT) for RM28.9m cash or 35 sen per share. Boustead said on Wenesday it would launch a take-over offer for the remaining shares it does not own, since it would hold more than 50% equity interest in Johan Ceramics. "The proposed acquisition of Johan Ceramics is part of Boustead Holdings' strategic intent to expand the range of building materials products within its building materials division," it said. (StarBiz)

Work on MRT viaduct to begin in August
Construction on the RM500m My Rapid Transit (MRT) Viaduct 7 (V7) work package for the Sungai Buloh-Kajang (SBK) line is slated to begin on 7 Aug 2012. The V7 package was awarded to MTD Construction SB in May this year, and involves the construction of the MRT viaduct guideway and other associated works over 3.8km from Bandar Tun Hussein Onn to Taman Mesra, Cheras, according to Mass Rapid Transit Corp SB (MRT Corp) in a media release yesterday. (Malaysian Reserve)

Faber to expand IFM services in Malaysia, overseas
Faber Group is looking to expand its integrated facilities management (IFM) hospital support services in Malaysia and also overseas. It said on Wednesday it would focus on specialised IFM services while it also waited for the government's decision about the hospital support services concession agreement. Faber said it had taken all necessary steps and actions to ensure the success of the concession agreement which recently expired. (StarBiz)

IJM to appeal NPE decision
IJM says the Public Partnership Unit in the Prime Minister’s Department has decided not to proceed with New Pantai Expressway SB (NPE)’s proposed New Pantai Elevated highway extension project. IJM told Bursa Malaysia that NPE intends to appeal for a reconsideration of the proposal. (BT)

Meydan LLC, Arabtec-WCT JV's client for the completed RM4.6bn Nad Al-Sheba Racecourse project in Dubai, has escalated the 2008 breach of contract issue, currently under arbitration, to a civil suit. Arabtec-WCT JV is claiming 2.8bn dirham (RM2.5bn) against Meydan LLC while Meydan is counter claiming 3.5bn dirham (RM3bn) from Arabtec-WCT JV. (BMSB)

SapuraKencana clarified the accounting consolidation method for the group‟s FY1/13 earnings. As the merger of SapuraCrest and Kencana was completed on 15 May 12, SapuraCrest will be consolidated into group earnings for 12 months from 1 Feb 12 as the company is deemed the acquirer. However, Kencana will be consolidated into group earnings for only 8 ½ months from 15 May 12 as the company is deemed an acquiree. The company also announced that it will not be announcing 1Q13 results as the merger was finalised in 2Q13. (BMSB)

Perisai Petroleum, which recently acquired a jack-up drilling rig for US$208m, wants to look at the take-up rate and funding requirements for the first jack-up before opting for a second one. MD Zainol Izzet Mohamed Ishak said the company has the option to build a second jack-up, which will cost US$210m, and will exercise that option by February next year. "We expect the rig to be delivered by June 2014 and to contribute handsomely when we put it to work," Izzet told reporters after the company's AGM. He added that the rig is one of the world's advanced rigs which can operate in 400ft of water. Izzet added that the company is expecting a big growth in business this year, driven by contributions from Garuda's MOPU and Intan's eight vessels. On the drilling business, he said that the company's primary market is Malaysia, but it aims to be a regional player. (Bernama)

The Securities Commission (SC) is believed to be in the process of clamping down on speculative trading of penny stocks. A circular from the SC to a brokerage house indicated that the clampdown was a high priority to the regulator. "The SC has found some unhealthy trading practices in the trading of penny stocks, which are low-priced shares of small companies," the regulator said. (BT)

The Court of Appeal imposed a 12-month jail term and fine of RM1.3m on former director of Fountain View Development Datuk Chin Chan Leong for market manipulation involving the company's shares. In a statement, the Securities Commission said in deciding to impose a 12-month jail term, the Court of Appeal took into account the fact that the offence committed was pre-planned and well thought out. Chin was found trading with 20 CDS accounts, which he beneficially owned through companies that he controlled. (Financial Daily)

Felda Global Ventures Holdings Bhd's listing represents a culmination of the government's strategic reform initiatives to raise the people's income and enhance Malaysia's global competitiveness. Its President and Chief Executive Officer Datuk Sabri Ahmad said settlers would gain from higher income through more efficient utilisation of their land which would lead to higher returns. They will also chalk up premiums from their shares upon listing and annual dividend payouts besides the RM15,000 given to settlers from the initial public offering (IPO) proceeds, he added. (Bernama)

There will be much riding on the debut of FELDA Global Ventures Holdings (FGVH) on Bursa Malaysia today — the world‟s second largest IPO this year — and it could either bolster or puncture the pride of the government and especially that of the prime minister‟s whose father masterminded the land grant scheme over 50 years ago to uplift the country‟s rural population. An FGVH flop, like the much maligned Facebook IPO did last month, could spark rumblings of discontent among settlers and investors alike and present an opportunity for the federal opposition to capitalise on any disappointment among the strategic 112,000-strong Federal Land Development Authority (FELDA) settler vote bank. If the shares rise and stay above the IPO price of RM4.45 however, it could help bring about a crucial feel-good factor for the Najib administration among settlers and investors as well as burnish Kuala Lumpur‟s emerging reputation as the region‟s IPO hub. (Malaysian Insider)

Boustead Holdings is acquiring a 97.14% stake in Johan Ceramics from Lembaga Tabung Angkatan Tentera (LTAT) for RM28.9m cash or 35 sen each. Boustead said on Wednesday it would launch a take-over offer for the remaining shares not owned, since it would hold more than 50% equity interest in Johan Ceramics. "The proposed acquisition of Johan Ceramics is part of Boustead Holdings' strategic intent to expand the range of building materials products within its building materials division," it said. (Starbiz)

Pacific Carrier Ltd., part of Malaysian tycoon Robert Kuok's empire, will take a 60% to 70% stake in its joint venture with Drydocks World's Southeast Asia business, a source close to the deal said. Drydocks, which is restructuring US$2.2bn in debt and sought insolvency protection in April, said earlier it had inked the deal with Kuok Group's Pacific Carrier Ltd. for its operations based in Singapore and Indonesia. (Reuters)

Sir Richard Branson‟s Virgin Atlantic Airways is expected to divest its 10% take in AirAsia X to local existing shareholders for more than RM66m. This comes as AirAsia X prepares for listing at the end of this year. Several individuals, including Tan Sri Tony Fernandes and Datuk Kamarudin Meranun will collectively hold 60% of AirAsia X. The remaining 40% will be held by AirAsia Bhd, Japan‟s Orix Group and Bahrain-based Manara Consortium. Virgin‟s entry price into AirAsia X in 2007 was never disclosed. But investors got an inkling of AirAsia X‟s valuation a year later when Japan‟s Orix Group and Manara Consortium took a 10% stake each in AirAsia X for a total sum of RM250m. The deal effectively valued AirAsia X at RM1.25bn. After the 2008 share sale and the rights issue in 2010, Virgin‟s equity interest was diluted to 10%. Aero Ventures‟ stake went up to 52% while Manara‟s and Orix‟s were up to 11% each. AirAsia maintained its 16% stake. AirAsia X registered a maiden profit of RM87m for FY09. However it swung into the red last year. (Financial Daily)

Former Malaysia Airlines deputy CEO Mohammed Rashdan Yusof has disposed a total of 901,900 shares or 0.027% in the company at an average price of RM1.16. This disposal were done on June 13 and 14. (Star Biz)

Tan Chong Motor (TCMH) managing director (MD) Tan Eng Soon has resigned from his post effective June 30. Tan said he would like to step down as group MD and director of TCMH upon expiry of his employment contract. Tan was appointed group MD on Feb 1, 1989. Meanwhile, executive deputy chairman Datuk Tan Heng Chew will assume the role and responsibilities of group MD and be re-designated executive deputy chairman and group MD effective July 1. (Starbiz)

US car maker Ford said it is to close its vehicle assembly plant in the Philippines by the end of the year, with the loss of 360 jobs, as part of an ongoing restructuring across Asia. The decision will leave the country without a motor vehicle exporter, Ford Group Philippines president Randy Krieger said. (AFP, BT)

TSH Resources Bhd says its RM90 offer price for each share in unlisted Pontian United Plantations Bhd (PUPB) is conditional on obtaining 50% plus one share to enable TSH to merge and integrate both companies. The price earnings ratio (P/E) of the offer price based on PUPB's three-year average net profit of RM55.6m is at 14.6x, higher than the average 7.7x P/E fetched by similar sized listed companies with a large base in Sabah. "About half of PUPB's plantations are above 15 years and there will be lots of work on replanting, which will benefit from our Biotech Centre's Wakuba high yield clones (ramets)," said group managing director Datuk Tan Aik Sim. (BT)

Celcom is optimistic that the newly-launched Celcom First Voice Plan will help the group expand its subscribers base. CEO Datuk Seri Shazalli Ramly said Celcom currently has about 11m subscribers. Celcom First Voice offers customers a new experience under Celcom Territory, with new branded features creatively designed to meet their needs. Under the plan, customers can enjoy one simple flat rate from as low as 10 sen across voice, video, SMS and MMS to all networks, anytime and anywhere, making it easier to keep track of usage patterns. On top of that, customers will also automatically be upgraded to a lower rate the moment their Real Rate hits the next price tier. This means the more they use, the more they save with a lower rate. The new plan also provides customers the flexibility of selecting their mode of payment - through usual postpaid billing or prepaid methods. It also offers customers the convenience of paying their postpaid bills using reload cards. (BT)

Kurnia Asia has not deliberated how it will utilise the RM1.55bm cash proceeds from the disposal of its domestic insurance business, including whether it will declare any special dividend. "After the disposal, Kurnia will become a cash company without any core business. We have 12 months to regularise the operation of Kurnia by the market regulator in accordance to the bursa Malaysia listing requirement," said its CIO Pankaj Kumar. He would not discount the possibility of Kurnia venturing into a different economic segment or industry after the divestment. "Insurance will still be the core activity, through our operation in Indonesia and Thailand. We will look at a new core activity to regularise the group's position as required by Bursa," said Pankaj. (Financial Daily)

Guan Chong Bhd (GCB) has received the Monetary Authority of Singapore's approval to publish its prospectus for public comment. GCB is proposing a dual listing on the Singapore Stock Exchange (SGX). It is already listed on the Main Market of Bursa Malaysia Securities Bhd. Its prospectus is expected to be available on the Monetary Authority's Offers and Prospectuses Electronic Repository and Access (Opera) site for a period of a week. GCB CEO Brandon Tay said the RM1.3bn revenue company is venturing into Singapore as a means to raise its profile among institutional investors as well as to enhance its stock liquidity. "While we do not plan to expand our capabilities aggressively, GCB is open to options whether through mergers and acquisitions or organically. Our proposed dual listing on the SGX is one such way of increasing our options," GCB said in its annual report. Tay said proceeds from the initial public offering (IPO) will be used for its expansion into downstream manufacturing activities in industrial chocolate production as well as the expansion of its Batam facility. Part of it will also go to lowering its gearing which is now at 1.6%. GCB will invest some RM90m to install a second line in its Batam factory to raise production capacity to 120,000 tonnes per year. The company has also invested RM42m for a plant in PTP to increase its industrial chocolate output. The new plant will be operational by the first quarter of 2013 with a total production capacity of 10,400 tonnes a year. (BT)

Digistar Corp Bhd, which transfers its listing status to the Main board of Bursa Malaysia today from the ACE market, has obtained a licence to install central monitoring systems nationwide for specific public and private sectors. The new business, which is expected to kick-off by the end of this year, will be an important stream of revenue for the company, which currently generates the bulk of its earnings from providing telecommunications, broadcasting engineering and Internet protocol television (IPTV) services to various sectors including health and education. Digistar was expected to make an announcement on the matter soon, sources said. Currently, there was a handful of companies which provide such security services locally but Digistar's services would supposedly go beyond the traditional security systems provided by such firms, sources said. (Starbiz)

Malton Bhd has entered into a share sale agreement (SSA) with Southcon Builders Sdn Bhd for the disposal of its entire interest in Austin Heights Sdn Bhd for RM34m cash. The SSA has been completed following the receipt of the balance disposal consideration of RM30.6mil by the company. (Starbiz)

Tradewinds Corporation: Crowne Plaza to make way for Tradewinds Centre project
Tradewinds Corporation (TCB) is scheduled to demolish two of its buildings next year to make way for the Tradewinds Centre project. The Tradewinds Centre, which will have four towers and is estimated to have a GDV of more than RM5bn, will be built at the locations of the Crowne Plaza Mutiara Hotel and Kompleks Antarabangsa in Jalan Sultan Ismail. The project will sit on a 2.8ha land and consist of office units, serviced apartments and a retail component.  According to sources, Crowne Plaza, which is managed by international hotel group Inter Continental Hotels Group (IHG), is expected to close its doors in March next year. It is unclear if IHG will be compensated should its management contract be terminated ahead of its tenure. (Business Times)

Deleum: MD says finalising M&A deals
Deleum expects to be busy with corporate exercises over the next two quarters, especially in regards to its merger and acquisition (M&A) plan. Group MD Nan Yusri Nan Rahimy however, refused to divulge the names of the M&A targets, except that the targeted entities were those that can add value to Deleum’s expansion plans. Nan Yusri had said last month that Deleum would put to good use its strong net cash position for, among other things, M&A exercises. The intention was to have units that could complement its core businesses, including power and machinery; oilfield services; and maintenance, repair and overhaul. (StarBiz)

Integrax: Big plans for Lumut port
Integrax  hopes to resume talks with Brazilian iron ore giant  Vale International SA even though their agreement lapsed two years ago. Newly-appointed  executive director Azman Shah Mohd Yusof said that they  are hoping to reopen negotiations with Vale through the state government. According to chairman Tan Sri Tajol Rosli Ghazali, Integrax intends to help Perak drive Lumut as its new economic capital after the Kinta Valley. Azman explained that the board had hammered out its strategic plan and presented it to the state government about a month ago. (StarBiz)

Faber Group: To expand IFM services in Malaysia, overseas
Faber Group is looking to expand its integrated facilities management (IFM) hospital support services in Malaysia and also overseas. It said on Wednesday it would focus on specialised IFM services while it also waited for the government's decision about the hospital support services concession agreement. Faber said it had taken all necessary steps and actions to ensure the success of the concession agreement which recently expired. As for its property development division, it said the group would unveil a high-end condominium project along Persiaran Gurney, Kuala Lumpur, and the targeted launch date was in the fourth quarter of this year. (StarBiz)

20120628 1007 Global Economy Related News.

Italy: Sells EUR9bn of Treasury bills as rates rise on contagion
Italy sold EUR9bn of Treasury bills at the highest rate since December amid concerns that the EU summit this week will fail to solve the sovereign-debt crisis. The Rome-based Treasury sold the 185-day bills at 2.957%, up from 2.104% at the last sale of similar maturity debt on 29 May. Investors bid for 1.62 times the amount offered, similar to the 1.61 times last month. (Bloomberg)

Portugal: Pledges to honour bailout terms, reforms
Portugal signaled on Wednesday it had no intention of requesting changes to the terms of its EUR78bn bailout, arguing that sticking to the plan was the only way to win credibility, Economy Minister Alvaro Santos Pereira said. He said that the country's strong commitment to the bailout terms has boosted credibility in the country and helped reduce its bond yields. (Reuters)

Spain: Sends alarm signal ahead of summit
Spain is determined to retain access to market funding and will push for European institutions to use available options to stabilize financial markets, premier Mariano Rajoy said, maintaining his policy stance ahead of the EU summit. Rajoy said he would fight to secure aid for the country's banks directly and without enhanced creditor status from Europe's rescue funds, but admitted that Spain would not be able continue financing itself at current yields for long. (Reuters)

EU: France and Germany in last-minute talks
Germany's Angela Merkel held last-minute talks Wednesday with French President Francois Hollande before a crucial EU summit but warned she would not budge in her opposition to pooling eurozone debt. In brief statements here in Paris both leaders made conciliatory gestures, with Hollande indicating he was ready to discuss further integration and the German chancellor hailing measures to promote eurozone growth. (AFP)

EU: Angela Merkel dismisses Spain’s and Italy's pleas for aid
Germany's Chancellor Angela Merkel angrily rejected desperate pleading by Italy and Spain as a Franco-German rift over eurozone debt sharing threatened to unravel efforts to find a fix for the single currency at the EU summit on Thursday. Merkel told German MPs that instead of more cash, the eurozone needed to step up debt reduction and economic reforms. "I fear that at the summit we will talk too much about all these ideas for joint liability and too little about improved controls and structural measures," she said. (Bloomberg)

US: Pending home sales climb to two-year high in May
Contract signings on home sales surged in May to the highest level in two years, a trade group said Wednesday, as the good news from the brow-beaten sector continued to accumulate. Pending home sales climbed 5.9% in May, with an index reaching 101.1, the National Association of Realtors reported. The index matched the best level since the initially planned expiration of the home-buyer tax credit and was 13.3% above May 2011 levels. (MarketWatch)

US: Orders for durable goods climb in May
Orders for long-lasting US goods bounced back in May after two straight declines, as demand for aircraft and heavy machinery such as farm tractors increased. Durable goods orders rose a seasonally adjusted 1.1% last month, led by the commercial-aircraft sector, whose orders rose 4.9%. Orders for motor vehicles increased by 0.5%. Excluding the transportation segment, orders rose a smaller 0.4%. (MarketWatch)

20120628 1001 Global Market Related News.

Market Briefs (Source: Reuters)
• US May Durable Goods +1.1%; f/c +0.4% prev revised lower to -0.2%
• US May Durable Good ex-trans +0.4%; f/c +0.7% prev revised up to -0.6 from -0.9
• US May Pending Home Sales m/m 5.9%; f/c 1.9% prev -5.5%
• US May Pending Home Sales y/y 15.3%; f/c 9.9% prev 14.7%
• Germany's Merkel reiterates Euro bonds are economically wrong and counterproductive
• German FinMin Schaeuble: Do not wish interest rates to remain so low, Don’t fear further downgrade of Germany due to bailout risks, Greece knows what its commitments are under bailout program, Will decide what to do after we get Troika progress report
• Italy Govt wins final confidence vote on labor reform law
• Spain’s Sec. of State for Public Administration doesn’t rule out salary cuts for public employees
• ECB’s Praet: There is no doctrine that interest rates cannot fall below 1%; Interest rate cuts always justified if they contribute to guaranteeing price stability in medium term
• ECB's Asmussen: EU and ECB mission to, with IMF support, to start work this evening in Madrid; Aim is to present Memorandum of Understanding to Eurogroup on July 9; Spanish memorandum will contain conditions for financial sector
• France’s Hollande says France and Germany both want to deepen European monetary union
• Fed’s Evans says ‘I think we should be doing more accommodation’; Hard to understand why Fed unwilling to do more to help economy, given low inflation

Priced-to-Sell Felda Jumps in IPO Debut: Southeast Asia (Source: Bloomberg)
Felda Global Ventures Holdings Bhd. (FGV), the world’s third-biggest oil palm planter, jumped as much as 20 percent in its Kuala Lumpur debut, after raising $3.3 billion in the biggest initial public offering since Facebook (FB) Inc. “Foreign investors haven’t been allocated sufficient shares,” said Alan Richardson, who helps oversee about $87 billion as a money manager at Samsung Asset Management Co. in Singapore. “An over-demand situation is likely.” Demand from institutions exceeded supply by more than 40 times during the IPO, Felda Chief Executive Officer Sabri Ahmad said in an interview on June 20. Unlike Facebook, the plantations group priced the stock below the top of its indicative range. The world’s largest social network company has slumped since its debut in May, while Felda rallied to 5.46 ringgit ($1.71) in the first 14 minutes of trading in Kuala Lumpur today.
The state-controlled company could have received more than 4.55 ringgit per share from institutions, though decided not to after allocating 90 percent of the available stock to Malaysian subscribers, Sabri said. “We wanted to put something on the table for them to enjoy,” he said.

Asian Stocks Rise on U.S. Home Sales, Durable Goods Data (Source: Bloomberg)
Asian stocks rose for a second day after reports showed U.S. home sales and durable goods orders climbed more than estimated and investors awaited the start of a summit on Europe’s debt crisis. Toyota Motor Corp. (7203) advanced 1 percent, leading gains among Japanese carmakers. Rio Tinto Group, the world’s third-largest mining company, rose 1.2 percent after metals prices climbed yesterday. Eisai Co. (4523) jumped 2.2 percent in Tokyo after its partner won Food and Drug Administration approval for weight- loss pill lorcaserin, making it the first obesity medication cleared for sale in the U.S. in 13 years. The MSCI Asia Pacific Index (MXAP) advanced 0.9 percent to 115.07 at 9:52 a.m. in Tokyo, before markets in China and Hong Kong opened. More than four stocks rose for each that fell. The gauge fell 12 percent through yesterday from its highest level of 2012 in February, paring its gain this year to 0.2 percent, amid concern growth in China and the U.S. is slowing as the euro-zone debt crisis escalates.
“The U.S. economy remains in a recovering trend,” said Mitsushige Akino, who oversees about $627 million in Tokyo at Ichiyoshi Asset Management Co. “Some deteriorating data, such as manufacturing, has been already factored into the market. Also, individual investors are buying companies counting on domestic demand and low-priced equities. That’s supporting the markets.”

China’s Stocks Fall for 6th Day After Daiwa Cuts Growth Estimate (Source: Bloomberg)
China’s stocks fell for a sixth day, the longest losing streak in six months, after Daiwa Securities Group Inc. cut its second-quarter growth estimate for the world’s second-biggest economy. Inner Mongolia Baotou Steel Rare Earth Hi-Tech Co. led a gauge of material producers lower on the prospect of weaker demand. Shanxi Coal International Energy Group Co. (600546) dropped to the lowest level since August 2010 after the board approved the resignation of its chairman. China Oilfield Services Ltd. (2883) and Offshore Oil Engineering Co. jumped more than 6 percent on expectations oil equipment makers will benefit after Cnooc Ltd. invited bids for oil blocks. “The market is bearish on the long-term outlook for China’s economic growth and we haven’t seen a new driver for the economy emerge so far,” said Wang Zheng, Shanghai-based chief investment officer at Jingxi Investment Management Co., which manages about $120 million.
The Shanghai Composite Index (SHCOMP) lost 0.2 percent to 2,216.93 at the close, after changing directions at least 10 times. The six-day decline is the longest since the period ended Dec. 15. The CSI 300 Index (SHSZ300) fell 0.3 percent to 2,447.20. The Bloomberg China-US 55 Index (CH55BN), the measure of the most-traded U.S.-listed Chinese companies, added 1.2 percent in New York yesterday.

Japanese Stocks Rise on U.S. Housing, Durable Goods Data (Source: Bloomberg)
Japan stocks rose a second day as reports showed U.S. home sales and durable goods orders climbed, showing signs of resilience in the world’s biggest economy ahead of a European summit on the debt crisis that opens today. Toyota Motor Corp., a carmaker that gets 20 percent of its revenue in North America, rose 1.2 percent. Chubu Electric Power Co. led utilities higher after nation’s biggest electricity producers committed to nuclear power. Eisai Co. (4523) climbed 2.2 percent after its partner won approval for the first weight-loss pill cleared in the U.S. in 13 years. “The U.S. economy remains in a recovery trend,” Mitsushige Akino, who oversees about $627 million in Tokyo at Ichiyoshi Asset Management Co. “Individual investors are buying companies counting on domestic demand and low-priced equities.”
The Nikkei 225 (NKY) rose 1 percent to 8,821.68 as of 9:59 a.m. in Tokyo. The broader Topix (TPX) climbed 1.1 percent to 753.79, with more than three shares rising for each that fell. Japan’s retail sales rose more than forecast in May, a sign consumer spending will help sustain an economic rebound. The Topix has fallen about 14 percent from its peak on March 27 as growth in the U.S. and China slows amid concern the debt crisis is spreading. Stocks on the gauge are valued at 0.89 times book value, with a number below one meaning a company can be bought for less than the value of its assets.

U.S. Stocks Advance Amid China Bets, Economic Reports (Source: Bloomberg)
U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a second day, amid better-than-estimated housing and durable goods orders data while speculation grew that China will add to economic stimulus. Energy and financial shares rose the most in the S&P 500 among 10 groups. A gauge of homebuilders in S&P indexes climbed 3 percent to the highest since 2008. Monsanto (MON) Co., the world’s biggest seed company, added 3.9 percent as earnings beat estimates. Facebook Inc. (FB) fell 2.6 percent as analysts including those at lead underwriter Morgan Stanley said the social-network operator is worth no more than its debut price of $38. The S&P 500 rose 0.9 percent to 1,331.85 at 4 p.m. New York time. It has risen 1.6 percent so far in June. The Dow Jones Industrial Average added 92.34 points, or 0.7 percent, to 12,627.01. Volume for exchange-listed stocks in the U.S. was 5.8 billion shares, or 14 percent below the three-month average.
“The economic data was encouraging,” said Walter Todd, who oversees about $940 million as chief investment officer of Greenwood Capital in Greenwood, South Carolina. “It’s important to see that because most recently we’ve had weaker data here and in China while Europe came back to the forefront. Any policy moves out of China would certainly be welcomed.”

Emerging Stocks Climb on China Speculation, Durable Goods (Source: Bloomberg)
Emerging-market stocks rose the most in a week on speculation China will take further steps to bolster economic growth and as U.S. durable goods order and pending home sales beat economists’ estimates. The MSCI Emerging Markets Index (MXEF) added 0.7 percent to 913.31 at the close of trading in New York, its steepest gain since June 19. The Hang Seng China Enterprises Index posted the longest winning streak in three weeks. OAO MRSK Holding, a Russian electricity distribution company, soared in Moscow to lead the advance in the Micex Index. (INDEXCF) OGX Petroleo e Gas Participacoes SA slumped in Sao Paulo after the oil company controlled by billionaire Eike Batista cut production targets. China may introduce “more proactive” policies to ensure stable economic growth, the China Securities Journal said today. Orders for durable goods rose 1.1 percent in the U.S., a Commerce Department report showed. The median forecast of 76 economists surveyed by Bloomberg News called for an 0.5 percent gain.
Separate data showed more Americans than forecast signed contracts to buy previously owned homes last month. European leaders meet tomorrow to find a solution to the debt crisis. “Any bit of positive noise processes into stronger reactions in the market right now,” Simon Quijano-Evans, the head of emerging-market research for Europe, the Middle East and Africa at ING Groep NV, said by phone from London today. “There’s expectation that China will act on some more impulses, that maybe we’ll see a better backdrop in the euro zone and the U.S. not coming in as negative as expected -- it’s a mixture of things giving some positive sentiment.”

European Stocks Rise on China Stimulus Optimism, US Data (Source: Bloomberg)
European stocks rose the most in a week after reports on U.S durable-goods orders and pending home sales beat estimates and speculation mounted that China will introduce additional economic stimulus. Lloyds Banking Group Plc (LLOY) and Barclays Plc followed bank shares higher. Portugal Telecom SGPS SA (PTC) climbed 3.1 percent after announcing a 200 million-euro ($250 million) share buyback. Glencore International Plc (GLEN) fell after target Xstrata Plc (XTA)’s second-largest shareholder asked for a higher bid. The Stoxx Europe 600 Index gained 1.4 percent to 245.87 at the close in London, snapping four days of losses. The gauge has climbed 5.1 percent from its 2012 low on June 4 as Greece formed a coalition government after its second election. The volume of shares traded on the measure was 17 percent below the average of the last 30 days, data compiled by Bloomberg show.
“Today’s move all boils down to the news related to the world’s two largest economies” said Keith Bowman, an equity analyst at Hargreaves Lansdown Stockbrokers in London. “Positive economic data from the U.S. and rumors of further stimulus from Chinese authorities is enough to lift the markets out of the doldrums that we have seen in recent days.”

Giant Jumps as Stimulus Bets Trigger ADR Rally: China Overnight (Source: Bloomberg)
Chinese stocks traded in New York rose for a second day, as Giant Interactive Group Inc. (GA) surged the most since April, on prospects the government will take steps to shore up flagging growth in Asia’s largest economy. The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese companies in New York added 1.1 percent to 89.95 at the close of trading in New York. Online game developer Giant Interactive advanced 6 percent and software developer VanceInfo Technologies Inc. (VIT) climbed the most since February. Melco Crown Entertainment Ltd. (6883) rose for the first time in three days after the Philippines’ Belle (BEL) Corp. said it’s in talks with the Macau casino operator to set up a gambling complex in Manila.
China may introduce “more proactive” policies to ensure stable growth, the state-owned China Securities Journal said in a commentary published yesterday. Daiwa Securities Group Inc. and HSBC Holdings Plc cut their annual growth outlooks as manufacturing may have contracted for an eighth month. Companies on the Bloomberg China-US Index that reported earnings from Feb. 15 to May 16 missed analysts’ estimates by 19 percent, according to data compiled by Bloomberg.

U.K. Stocks Rise for First Time in Five Days; BP Rallies (Source: Bloomberg)
U.K. stocks climbed for the first time in five days after better-than-estimated U.S. data helped ease concern about the strength of the global economy before tomorrow’s European Union summit. BG Group Plc (BG/) and BP Plc climbed with crude oil, while CRH Plc (CRH) and Wolseley Plc (WOS) led construction-industry shares higher. Standard Chartered Plc (STAN) rallied 3.1 percent as Britain’s second- largest bank by market value reiterated its forecast. The FTSE 100 Index (UKX) rose 76.96, or 1.4 percent, to 5,523.92 at the close in London, the biggest gain since June 19. The gauge had lost 3.1 percent over the previous four days amid concern this week’s summit in Brussels won’t produce decisive measures to contain Europe’s debt crisis. The FTSE All-Share Index and Ireland’s ISEQ Index each increased 1.3 percent today.
“Durable goods and pending home sales data both enjoyed positive reads,” said Will Hedden, a sales trader at IG Index in London. “Generally, the mood is a little more positive today despite the pending EU summit.”

Facebook Analysts See Shares Staying Less Than $38 IPO Price (Source: Bloomberg)
Facebook Inc. (FB) analysts including those at lead underwriter Morgan Stanley (MS) say the social-network operator is worth no more than its debut price of $38. At least 17 securities firms began coverage of the company today, bringing the average analyst share-price estimate to $37.95, data compiled by Bloomberg show. Morgan Stanley gave Facebook the equivalent of a buy rating, as did JPMorgan Chase & Co. (JPM), Goldman Sachs Group Inc. (GS) and five other firms. There were eight holds and one sell, the data show. Facebook, its bankers and listing exchange Nasdaq OMX Group Inc. faced criticism after the shares fell below the initial public offering price of $38 on the second day of trading and extended declines to 32 percent on June 5. Underwriters sold stock at a higher valuation than every Standard & Poor’s 500 Index company except two.

FOREX-Euro steady, investors hold fire before summit
LONDON, June 27 (Reuters) - The euro steadied against the dollar after hitting a two-week low the previous day, but looked vulnerable ahead of a European Union summit that is not expected to deliver new measures to ease the region's debt crisis.
"People are waiting for the inevitable - which is that policymakers will probably fail to do what is necessary," said Neil Mellor, currency analyst at Bank of New York Mellon.

Euro Remains Lower Before Italy’s Debt Sales (Source: Bloomberg)
The euro was set for the biggest quarterly drop versus the yen since September amid concern the region’s debt crisis is spreading to bigger economies. The 17-nation currency remained lower against the dollar following a three-day decline before an Italian debt auction today and data forecast to show economic confidence in the euro bloc deteriorated. At a summit starting in Brussels today, European Union leaders will convene for the first time since pro-bailout parties won at Greek parliamentary elections on June 17. The dollar slid versus most major counterparts as gains in stocks supported demand for higher-yielding assets. “People are looking for further weakness in the euro,” said Alex Sinton, director for institutional foreign exchange in Auckland at Australia & New Zealand Banking Group Ltd. (ANZ) “Growth there is waning.”
The euro slid 0.1 percent to 99.29 yen as of 10:02 a.m. in Tokyo from the close in New York yesterday. It rallied 0.2 percent to $1.2491 after losing 0.8 percent over the past three days. The dollar slid 0.3 percent to 79.50 yen. Since the end of March, Europe’s shared currency has fallen 10 percent versus the yen and 6.4 percent against the dollar. As the first half of the year nears its close, the dollar is up 3.4 percent in 2012 against the yen.

Aussie, Kiwi Remain Higher on Evidence of Global Growth (Source: Bloomberg)
The Australian and New Zealand dollars climbed for a third day as U.S. economic reports eased concern the world’s largest economy is faltering, boosting demand for higher-yielding assets. The so-called Aussie headed for its biggest monthly gain versus the U.S. dollar since January as traders increased bets the Reserve Bank of Australia will keep rates unchanged next week as long as Europe’s debt crisis doesn’t deteriorate. New Zealand’s currency, nicknamed the kiwi, was set for the second- biggest gain in June among the greenback’s 16 major trading partners as Asian stocks extended a global advance. “There seems to be sufficient life in the U.S. economy without further stimulus,” said Hans Kunnen, chief economist at St. George Bank Ltd. in Sydney. The RBA is “saying it will really only ease with further unsettling news from Europe. The Aussie has the potential to edge higher on the fact that our interest rates seem stable for the time being.”
The Australian dollar rose 0.4 percent to $1.012 as of 10:53 a.m. in Sydney from $1.0080 at the close in New York yesterday. It added 0.1 percent to 80.46 yen. New Zealand’s currency climbed 0.4 percent to 79.52 U.S. cents and advanced 0.2 percent to 63.22 yen.

Slowdown Concern Ebbs on Durable Goods, U.S. Home Sales (Source: Bloomberg)
Orders for durable goods and the number of Americans signing contracts to buy an existing home rebounded in May, easing concern the world’s largest economy is faltering. Bookings for goods meant to last at least three years rose 1.1 percent, the first increase since February, a Commerce Department report showed today in Washington. Pending home sales climbed 5.9 percent after slumping 5.5 percent in April, according to data from the National Association of Realtors. Stocks rallied as the figures indicated manufacturing, a mainstay of the economy, was holding up amid a global economic slowdown that’s curbing demand for exports and hurting sales at companies like Joy Global Inc. (JOY) Housing, the industry that triggered the recession, may keep improving as record-low mortgage rates spark buyer interest.
“The economy is growing, but it’s still muddling through,” said Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, who forecast a gain in durables orders and pending home sales. “Concerns about the collapse of manufacturing are grossly overblown. We’re in a housing recovery.”

Pending Sales of U.S. Homes Climbed More Than Forecast (Source: Bloomberg)
More Americans than forecast signed contracts to purchase previously owned homes in May, indicating the real estate industry is firming three years after the start of the economic recovery. The index of pending home resales climbed 5.9 percent to 101.1, matching a two-year high reached in March, after a 5.5 percent decline in April, figures from the National Association of Realtors showed today in Washington. The median forecast of 39 economists surveyed by Bloomberg News called for a 1.5 percent gain in May. Record-low mortgage rates and cheaper properties may keep sparking buyer interest, even as cooling employment and limited access to credit remain hurdles for the market. The Federal Reserve’s decision last week to extend a program aimed at holding down borrowing costs may sustain the progress in residential real estate.
“This improvement adds to the recent flow of good news on the housing sector, reinforcing our view that this beleaguered sector is finally on the mend,” Millan Mulraine, a senior U.S. strategist at TD Securities in New York, said in an e-mail to clients. “It points to a decent pop in existing-home sales activity in June.” Estimates in the Bloomberg survey ranged from a drop of 1.6 percent to a rise of 6.8 percent.

Older Workers in U.S. Drive Competition in Labor Market (Source: Bloomberg)
June 27 (Bloomberg News) -- Richard InLove, 60, works 20 hours a week as a receptionist and office assistant in Eugene, Oregon, and wants more. After losing a full-time job in a cereal factory three years ago, he hasn’t been able to find a second position. “I’d do one more part-time job if I could get it,” said InLove, who has been with a local museum since 2010. “I am still looking but it’s been hard.” He plans to join the record 7.3 million workers 65 or older trying to shore up finances battered by the recession that ended three years ago and stay productive. An aging population, longer and healthier lifespans and changes to retirement-benefit plans will mean rising competition for jobs and limited wage gains even after the economy strengthens.
About 74 percent of Americans say they plan to work past age 65, according to a May study by economists Jay Bryson and Sarah Watt of Wells Fargo Securities LLC in Charlotte, North Carolina. Thirty-nine percent said they need to earn to make ends meet or maintain their lifestyle, and 35 percent wanted to stay employed.

Housing Exuberance Led by Shiller’s U.S. Glamorous Cities (Source: Bloomberg)
Home prices are beginning to rise after a six-year slump in cities from San Francisco and Seattle to Miami with jobs and lifestyles that appeal to younger and affluent buyers. “A number of the cities that have done the best have been glamour cities,” Robert Shiller, an economics professor at Yale University and co-creator of the S&P/Case-Shiller property-value indexes, said yesterday in an interview on Bloomberg Radio’s “Surveillance” with Tom Keene. “People have this speculative fervor. It comes back.” A tight supply of homes and an increase in affordability fueled by record-low mortgage rates are helping shore up some regional markets where values plunged during the recession. San Francisco’s home prices surged at a 16 percent annual rate in the three months ended in April, while Phoenix gained at a 26 percent rate, according to Case-Shiller.
“Glamour cities where people want to move to and reside have always been on the East Coast and West Coast,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ. “The drop in mortgage rates closer to 3.5 percent helped stimulate demand,” while sellers holding homes off the market caused “not a lot of supply, and what was out there got bid up.”

Colorado Wildfire Forces 32,000 to Evacuate as Homes Burn (Source: Bloomberg)
Dusty winds turned an erratic, out- of-control fire back toward Colorado Springs today, destroying homes, forcing evacuations and burning more than 15,000 acres. Scattered thunderstorms over Colorado’s second-largest city didn’t reduce the ferocity of the Waldo Canyon fire, whose flames have moved unpredictably, propelled by dry conditions and winds gusting to near hurricane strength. “It’s been house to house, door to door, street to street activity all night long and continued into today,” Rich Harvey, the incident commander for the multi-agency group fighting the blaze, said today at a news briefing.
Record heat and drought are fueling wildfires across the West, including in Idaho, Montana and New Mexico. In Colorado, at least nine have burned over about 233 square miles (600 square kilometers), according to the Incident Command System. President Barack Obama will travel to Colorado Springs June 29 to “view the damage and thank the responders bravely battling the fire,” according to a statement from his office.

Japan Sales Tax Risks Growth Grinding to Halt in 2014: Economy (Source: Bloomberg)
Japan’s Prime Minister Yoshihiko Noda risks stalling the economy by pushing through a higher sales tax that may damp consumption even as it aids efforts to tame the world’s largest debt burden. The nation’s recovery after last year’s earthquake and tsunami could grind to a halt in 2014 when the first increase will take effect, according to UBS AG and Itochu Corp. (8001) Parliament’s lower house yesterday approved the bill to raise the tax to 8 percent and then 10 percent in 2015 from 5 percent now. A slump would be a repeat of 1997, when an increase in the levy contributed to pushing the economy into a 20-month recession, costing then Prime Minister Ryutaro Hashimoto his job.
“If there are no economic stimulus measures along with a consumption tax hike we can see around zero percent growth in fiscal 2014,” said Takuji Aida, a Tokyo-based economist at UBS, who raised his growth forecast for the year ending March 2014 to 2.9 percent from 2.2 percent because he sees a 4 trillion yen ($50.4 billion) rise in consumption and investment ahead of the tax increase. A 1 percentage point increase in the tax would cut growth in real gross domestic product by 0.32 percentage point in the year after implementation, according to the Cabinet Office’s Economic and Social Research Institute.

South Korea’s Current-Account Surplus Widens to Six-Month High (Source: Bloomberg)
South Korea’s current-account surplus widened in May to a six-month high as exports increased from the previous month and annual dividend payments to foreign shareholders declined. The surplus was $3.6 billion compared with a revised surplus of $1.7 billion in April, the Bank of Korea said in a statement today in Seoul. The current account is the broadest measure of trade, tracking goods, services and investment income. The prospect that Europe’s debt woes will further damp global demand has weighed on consumer and business sentiment in South Korea, where the central bank earlier this month held off from altering borrowing costs for a 12th straight month. Confidence among U.S. consumers fell in June for a fourth consecutive month, while South Korean manufacturers’ sentiment dropped to a four-month low and consumer confidence slid to a three-month low.
“We may see a further economic slowdown unless the EU moves quickly and decisively,” Park Sang Hyun, chief economist at HI Investment & Securities Co. in Seoul, said before the release. “Interest rate cuts will come in South Korea as the last resort.” The won advanced 0.2 percent to 1,156.17 per dollar yesterday, according to data compiled by Bloomberg, trimming this quarter’s decline to 2 percent. The Kospi was little changed.

India Plans $5.3 Billion of Highways as Jams Sap Growth (Source: Bloomberg)
India may spend 300 billion rupees ($5.3 billion) tripling the length of its expressway network to ease traffic jams that are slowing trade, wasting fuel and sapping economic growth. The country intends to add about 1,600 kilometers (1,000 miles) of roads with at least six lanes, Raghav Chandra, joint secretary at the Ministry of Road Transport and Highways, said in an interview on June 14. He didn’t give a timeframe for awarding construction contracts or for completing the projects. The new highways, linking major cities, will have higher tolls than existing roads and fewer access points so trucks won’t get stuck at toll gates or behind queues of motorcycles, auto-rickshaws and tractors making local trips. India plans to build the network as it contends with congestion that costs $5.5 billion a year, according to a study by Transport Corp. (TRPC) of India and the Indian Institute of Management, Calcutta.
“This is the first step towards really improving traffic movement,” said Vishwas Udgirkar, a Gurgaon, India-based senior director for transport at Deloitte Touche Tohmatsu India Pvt. “India is way behind other countries in creating such infrastructure.”

Singh Pledges India Sentiment Push After Taking Finance Role (Source: Bloomberg)
Prime Minister Manmohan Singh said reviving investor confidence in India is one of his top priorities after taking charge of the finance ministry. “At the current juncture, we are passing through challenging times economically,” Singh said in a statement in New Delhi today. “We need to work to get the economy going again and restart the India growth story. In the short run, we need to revive investor sentiment, both domestic and international.” Singh, who assumed the finance role yesterday after Pranab Mukherjee resigned, faces a budget deficit requiring record borrowing, a paralysis in policy making that has hurt efforts to spur investment and a faltering global recovery. The rupee has slumped to an unprecedented low against the dollar, stoking elevated inflation by making imports costlier.
The currency, which touched a record low of 57.3275 per dollar on June 22, declined 0.2 percent to 57.135 today. It is down 21 percent in the past year, the worst slide among major Asian currencies. Aside from India’s deteriorating outlook, the rupee has also been hurt by Europe’s debt crisis, which has sapped demand for emerging-market assets.

Draghi May Enter Twilight Zone Where Fed Fears to Tread (Source: Bloomberg)
European Central Bank President Mario Draghi is contemplating taking interest rates into a twilight zone shunned by the Federal Reserve. While cutting ECB rates may boost confidence, stimulate lending and foster growth, it could also involve reducing the bank’s deposit rate to zero or even lower. Once an obstacle for policy makers because it risks hurting the money markets they’re trying to revive, cutting the deposit rate from 0.25 percent is no longer a taboo, two euro-area central bank officials said on June 15. “The European recession is worsening, the ECB has to do more,” said Julian Callow, chief European economist at Barclays Capital in London, who forecasts rates will be cut at the ECB’s next policy meeting on July 5. “A negative deposit rate is something they need to consider but taking it to zero as a first step is more likely.”
Should Draghi elect to cut the deposit rate to zero or lower, he’ll be entering territory few policy makers have dared to venture. Sweden’s Riksbank in July 2009 became the world’s first central bank to charge financial institutions for the money they deposited with it overnight. The Fed rejected cutting its deposit rate from 0.25 percent last year. With Europe’s debt crisis damping inflation pressures and curbing growth, the ECB may feel the benefits outweigh the negatives.

Merkel Rebuffs Rajoy Plea, Shuts Door to Euro Area Bonds (Source: Bloomberg)
German Chancellor Angela Merkel shut the door to joint euro-area bonds as a means of lowering Spain’s borrowing costs, saying they are the “wrong way” to achieve the greater European integration needed to stem the debt crisis. Speaking three hours after Spanish Prime Minister Mariano Rajoy made a plea for help from tomorrow’s European summit, Merkel said that euro bonds, euro bills and debt redemption funds are unconstitutional in Germany and economically “wrong and counterproductive.” “I fear that at the summit there will be much too much talk about mutual liability and far too little about improved oversight and structural measures,” Merkel told lower-house lawmakers in Berlin today. “Oversight and liability have to go hand in hand. There can only be joint liability when adequate oversight is ensured.”
Merkel is under growing pressure from her European and global counterparts to soften her opposition to debt sharing in the euro area and do more to cut borrowing costs for Spain and Italy. Rajoy, outlining his goals for the two-day European Union summit beginning in Brussels tomorrow, said that Spain can’t go on financing itself at current borrowing rates for long. “The most important thing today is being able to finance ourselves in the markets, that’s the main issue,” Rajoy said in Parliament in Madrid. “And on that point Spain, Italy and other countries are going to push for reasonable decisions to be made,” using the “available instruments.”

Barclays Shows Need for CFTC, SEC Funds, Wolin Says (Source: Bloomberg)
The Barclays Plc (BARC) settlements on interbank rates shows the need for the U.S. Commodity Futures Trading Commission and the Securities and Exchange Commission to be “appropriately funded,” the Treasury Department’s No. 2 official said. Barclays was fined 290 million pounds ($451.4 million) after admitting it submitted false London and euro interbank offered rates. The settlements were reached with the U.K.’s Financial Services Authority, the CFTC and the U.S. Department of Justice. House Republicans are seeking to cut the CFTC’s fiscal 2013 budget by $25 million to $180 million, about 42 percent below President Barack Obama’s request. Senate Democrats are seeking to increase the budget of the main financial-markets regulators in spending plans that clash with House Republicans’ efforts to cut funds and rein in the Dodd-Frank Act. A Senate Appropriations subcommittee has proposed a 19 percent increase for the SEC.
Wolin also said so-called “living wills” are a piece of a bigger whole of the Dodd-Frank financial overhaul to ensure that banks can be unwound. Some of the largest banks, including JPMorgan Chase & Co. (JPM) and Bank of America Corp., are required to submit to regulators by July 1 drafts of plans, known as living wills, of how they should be dismantled or rebuilt if they fail.

Czech Bargain Addicts Invigorate Push to Cut Interest Rates (Source: Bloomberg)
For Ales Moravek, the ever-deeper discounts luring buyers into his outdoor equipment store are biting into profits. For central bank Governor Miroslav Singer, they are adding to reasons to cut borrowing costs this week. A deepening recession is amplifying the Czech Republic’s traditional penchant for thrift and aversion to debt. Moravek, who co-owns a shop in Hradec Kralove, is among Czech retailers grappling with a shrinking market as fading consumer demand limits room to increase prices. “It’s incomparable,” Moravek, 47, said in an interview in his shop 100 kilometers (62 miles) east of Prague. “We rarely used to have sales before. Now one campaign follows another. Discounts on boots end one day, discounts on camping equipment start the next. This basically runs the entire season.”
Faltering demand pushed Singer, the Ceska Narodni Banka governor, to seek a reduction in borrowing costs deeper below the euro-area benchmark in May. As the European Central Bank lifted and then lowered its main rate by half-percentage point to 1 percent last year, the Czechs have held rates steady at a record-low 0.75 percent for two years because consumers’ spending fell short of fueling inflation.

Rajoy to Call for Easing Spain’s Borrowing Costs at Summit (Source: Bloomberg)
Spanish Prime Minister Mariano Rajoy said he will urge other European Union leaders at a summit tomorrow to move more urgently to reduce unsustainably high interest rates. EU leaders must use the “available instruments” to stabilize markets, Rajoy said in Parliament today, as Spain’s 10-year bond yields surged toward the 7 percent level that prompted full bailouts in other euro members. “The most important thing today is being able to finance ourselves in the markets, that’s the main issue, and on that point Spain, Italy and other countries are going to push for reasonable decisions to be made,” Rajoy said. “We can’t finance ourselves at the prices we are paying for very long.” EU leaders convene in Brussels June 28-29 for their 19th summit since the debt crisis started as pressure builds on German Chancellor Angela Merkel to make concessions to solve the two year-old crisis. Their talks will focus on a 10-year road map released yesterday by four officials led by European Union President Herman Van Rompuy.

Monti Plays Italian Politics in Labor-Law Overhaul: Euro Credit (Source: Bloomberg)
Italian Prime Minister Mario Monti, seeking to bridge European differences over how to end the region’s debt crisis, is pushing a labor market overhaul at home that has divided his allies and sapped his support. The legislation, designed to revive Italy’s economy by making it easier for distressed companies to fire workers, is due to be voted on by parliament today before tomorrow’s European Union summit in Brussels. Italy’s 10-year bond yield, at more than 6 percent, has jumped 30 basis points since June 9 when Spain became the fourth euro-region country to seek aid. The yield fell 5 basis points today to 6.14 percent. “In the European scenario, Monti is doing very well,” said Tommaso Nannicini, a professor of political economy at Bocconi University in Milan. “On the domestic side he looks more and more incapable of keeping together his majority and gives the impression of a lack of political action.”
Monti was pressed into watering down the labor law as Italy’s recession deepened and public support for the government waned. Monti is facing the possibility of early elections, while abroad he is pushing euro-region allies for collective action to foster growth. The summit will be Monti’s second meeting in less than a week with German Chancellor Angela Merkel, Spanish Prime Minister Mariano Rajoy and French President Francois Hollande after hosting the three in Rome.

20120628 1001 Global Commodities Related News.

WeatherBELL Agriculture Weather Outlook: 2011 versus 2012 and the Grains (Source: CME)
Weather Could Produce Volatility for the Grains Markets
June 2012, New York: For the second year in a row, weather could very well produce significant volatility for the grains markets due to levels of dryness not previously seen in over two decades. Recall that last year, the second strongest La Nina on record caused severe drought in the southern US. Meanwhile, heavy snows and spring rain in the northern areas of the US led to the worst flooding since 1927 in the Ohio, Mississippi, and Missouri River basins. As a result, planting was the latest on record in parts of the Corn Belt and there were serious losses to Hard Red Winter Wheat (HRWW) in the Southern Plains. Dryness in the Southern Plains built up a heat ridge that sent plumes of intense heat into the prime growing areas of the Corn Belt during corn’s critical pollination stages. Although La Nina returned this past winter, it was substantially weaker. The winter and spring of 2012 produced more normal levels of precipitation in the southern states, though much less snow and spring precipitation further north.

DTN Closing Grain Comments 06/27 14:58 : Grains Fizzle While Weather Sizzles (Source: CME)
Grain contracts posted highs early in Wednesday's session before positioning in front of Friday's Quarterly Stocks report and acreage update are released. Additional pressure came from liquidation after CME announced a margin requirement increase that goes into effect following Friday's close. Weather forecasts remain hot and dry for most of the Midwest, with many areas expected to post record high temperatures Wednesday.

Weather Continues Boost of Corn, Soybeans (Source: CME)
Some light long profit taking has grain trade mixed at midday; weather concerns persist.
By David Fiala, DTN Contributing Analyst

The U.S. stock market indices are flat with the Dow index up 5 points. The interest rate products are higher. The dollar index is 5 higher. Energies are mixed with unleaded and ethanol higher, but crude is off $.30. Livestock trade is lower with feeder cattle off sharply again. Precious metals are lower with gold down $15.

General Comments
Corn trade is 9 to 11 higher this morning with the market thinking no rain makes no grain. Outside markets are quiet this morning. This is a major report week with the acreage and stocks report due out on Friday morning. Trade should remain very active in limit type volatility with corn pollination getting under full swing, plus we will have the trade open during the report releases on Friday. The weather forecast has some rains for later in the week, but we have heard that before. Trade has the next resistance at $6.42, but the prior resistance has not slowed things much at all. Ethanol production is expected to decline 2% to 3% this week, with inventories showing a decline of a similar amount. Ethanol margins are sharply negative, and a continued slide in oil prices could do a lot of damage to ethanol producers.

Soybean trade is 13 to 15 higher this morning, meal is $4 to $6 lower and bean oil is 25 to 35 higher. Beans have bounced back from yesterday's weakness so far. November beans have taken out the $14 mark and resistance is now hard to point to, but the fund length will continue to keep the bean contract vulnerable to bouts of profit taking. The $14.50 area will be the next psychological hurdle. U.S. soybeans effectively remain the cheapest oilseed available for the export market, and will keep the majority of the export business from now until March. The Chinese growing areas have not had the best weather either which will keep the pressure on imports with crush margins working back to positive.

Wheat trade is mostly flat this morning with row crop strength providing support, but harvest pressure limiting upside for the moment. The speculative short has been whittled down pretty good at this point. Russia and Ukraine look to be limited factor in the export markets coming forward. The most active wheat contracts are now solidly positive on their charts, and could be set up for a further run in the near term. This could trigger farmer selling on wheat on short term free storage in the elevators in the plains. U.S. origin will remain the cheapest origin for awhile. The Australian crop looks to be in trouble early.

U.S. Farmers Facing Reality Check as Drought Hits Corn, Soybeans (Source: CME)
Springtime optimism has devolved into summertime angst for farmers such as Chris Barron, who’ve been forced to scale back once-lofty expectations for their corn and soybean crops as drought expanded across much of the U.S. Midwest.  Barron said his cropland, near Cedar Rapids in northeastern Iowa, received about 0.94 inch of rainfall so far in June, or about 20 percent of the 30-year average for the month. He’s trimmed his harvest outlook accordingly, with his corn and soybean plots likely generating yields 7 percent to 10 percent below what he estimated a few months ago. “We’ve got the potential for an average crop,” said Barron, a member of a farmer partnership that raises crops on about 7,000 acres. “The opportunity to have an above-average crop is gone. That’s just the reality.”
As farmers and grain traders await updated U.S. Department of Agriculture acreage data June 29, extreme heat and dryness has shifted squarely into market focus. Intensifying weather concern ignited a rally in CME Group grain markets, sending corn futures up over 20 percent since mid-June, and analysts say the market may have further upside if dryness continues. Drought threatens to undercut the benefits of an unusually warm and dry spring that likely led to the largest combined corn and soybean planted acreage on record.

Pro Farmer: After the Bell Wheat Recap (Source: CME)
Wheat futures favored a firmer tone to close mostly between 3 and 9 cents higher at all three exchanges. July Minneapolis wheat ended lower amid liquidation pressure. Wheat continues in a follower's role, watching price action in the corn pit closely. As corn came off its session high, wheat followed suit. Strength in the U.S. dollar index ahead of the euro-zone economic summit also limited buying into the close.

Wheat Market Recap Report (Source: CME)
September Wheat finished up 4 1/4 at 751 1/4, 12 1/4 off the high and 11 3/4 up from the low. December Wheat closed up 6 at 772 1/4. This was 13 1/4 up from the low and 11 off the high. September Chicago wheat settled 4 1/4 cents higher today after posting its 3rd consecutive higher high. Kansas City and Minneapolis wheat gained on Chicago with Minneapolis leading the wheat complex higher after Stats Canada estimated Canadian wheat seeding at 23.8 million acres. This was slightly lower than trade forecasts but exceeded last year's seeded area of 21.5 million acres. Short covering support was noted after corn moved sharply higher on a warmer and drier two week weather forecast. The USDA will release their Grain Stocks and Planted Acreage report on Friday. Traders are expecting June 1 stocks near 720 million bushels vs. 862 million bushels on June 1, 2011. The trade also expects all wheat planted acreage near 56.6 million acres. This would be slightly higher vs. the March forecast of 55.90 million acres. September Oats closed up 8 1/4 at 337 1/2. This was 8 up from the low and 4 off the high.

Pro Farmer: After the Bell Corn Recap (Source: CME)
After enjoying gains in the upper teens to low 20s most of the day, the corn market trimmed gains as the dollar strengthened to end "just" 5 to 10 cents higher through the July 2013 contract. For most of the day, traders focused on building weather premium, as they are concerned about the yield implications of scorching Midwest temps paired with limited precip chances the remainder of this week and into the next.

Corn Market Recap for 6/27/2012 (Source: CME)
September Corn finished up 10 at 629 1/2, 19 3/4 off the high and 17 1/2 up from the low. December Corn closed up 10 at 634. This was 16 3/4 up from the low and 22 3/4 off the high. December corn was trading 10 cents higher heading into the closing bell after trading a 38 cent range today. The early trade penetrated highs made in September of 2011 but gains were erased after traders began taking profits ahead of a CME margin increase this evening and ahead of the USDA reports for Friday. Producer selling was also active. Weather maps show scorching temperatures for the central and southern Midwest to finish out this week. The heat dome is expected to stretch from the panhandle of Oklahoma to the coast of South Carolina. Temperatures in Central Illinois and Indiana are expected to reach 100 degrees by tomorrow which will likely increase stress on corn and diminish yield potential for areas in the southern Midwest and Delta. The USDA will release their Grain Stocks and Planting Intentions report Friday. The trade expects a slight increase in corn acreage, however traders will key off the stocks estimate. The trade expects June 1 stocks of near 3.17 billion bushels with range of estimates as wide as 670 million bushels. Ethanol production for the week ending June 22nd averaged 883,000 barrels per day. This is down 1.9% vs. last week and down 1.1% vs. last year. Total Ethanol production for the week was 6.18 million barrels which is down from 6.30 million barrels last week. Corn used in last week's production is estimated at 94.06 million bushels which is a 9 week low. Corn use needs to average 97.5 million bushels per week to meet the USDA forecast for the season. Stocks were 20.7 million barrels. This is down 2% vs. last week and up 6.5% vs. last year. September Rice finished down 0.02 at 15.01, 0.17 off the high and 0.01 up from the low.

US corn stocks shrink least in three years-trade
CHICAGO, June 26 (Reuters) - U.S. corn stocks likely shrank by the fewest bushels in three years during the three months to June, a Reuters poll found, as demand ebbed due to depressed ethanol margins and stiff export competition.
Inventories probably fell to 3.174 billion bushels as of June 1, nearly a half billion bushels, or 13-1/2 percent, less than a year ago, according to an average estimate of 15 analysts. That would put inventories at their lowest for June 1 since 2004, just as prices have surged anew on fears that the new spring crop will be damaged by weather.

US corn dips from 9-month top, wheat eases
SINGAPORE, June 27 (Reuters) - Chicago corn slipped as the market took a breather after climbing to a 9-month top and adding more than 12 percent in the last two sessions, sparked by a severe drought in the U.S. Midwest.
"I think the market has done a lot of work to price in the anxiety over weather," said Brett Cooper, a senior manager of markets at FCStone Australia.

US crops to bake in dry heat this week
CHICAGO, June 26 (Reuters) - Searing heat and dry weather across the U.S. Midwest this week will increase stress on corn and soybean plants, already hurt by a lack of rain this month, agricultural meteorologists said on Tuesday.
"With this heat and dryness there certainly will be more damage done," said Don Keeney of Cropcast, a division of MDA EarthSat Weather.

S.Africa's 2012 maize output f'cast steady at 11.056 mln T
JOHANNESBURG, June 26 (Reuters) - The South African government left unchanged its maize output forecast for 2012 at 11.056 million tonnes on Tuesday, in line with market expectations, saying it expects to have a better picture of the crop next month as harvesting continues.
The total maize crop forecast consists of an estimated 6.36 million tonnes of white maize and 4.696 million tonnes of yellow, the government's Crop Estimates Committee (CEC) said.

Fertilizer makers rise as smaller corn crop may lift demand
June 26 (Reuters) - Shares of fertilizer makers including CF Industries Holdings Inc  and Terra Nitrogen Co LP  rose on Tuesday, as an expected fall in corn production this summer could fuel higher demand for crop nutrients in the next planting season.
Weekly crop data, released by the U.S. Department of Agriculture (USDA) late on Monday, rated U.S. corn as 56 percent good to excellent as of Sunday, down 7 percentage points from a week earlier and well below a 61 percent average estimate in a Reuters poll.

Russia's Novo to cut grain-handling tariff by 5 pct
MOSCOW, June 27 (Reuters) - Russian port Novorossiisk   plans to cut grain-handling tariff by as much as 5 percent or 30 roubles ($0.91) per tonne from July 1 to boost grain exports after winterkill and spring drought.
"Our team has managed to reduce the tariff thanks to optimisation of production processes," Rado Antolovich, acting general director of the port, was quoted as saying in the statement on Wednesday.

Rain to push Brazil sugar output to later in year
SAO PAULO, June 26 (Reuters) - Widespread rain during the first few months of Brazil's center-south sugarcane crush has slowed sugar and ethanol production and will push more of that output to the second half of the season, cane industry association Unica said on Tuesday.
Sugar output from the main center-south crush from April through mid-June fell 28 percent, compared with a year ago, to 4.89 million tonnes.

Egypt 2012/13 cotton crop seen down 42 pct-US attache
WASHINGTON, June 26 (Reuters) - Egyptian cotton growers cut plantings by 45 percent because of low prices and will harvest 42 percent less cotton in 2012/13 than in the preceding season, the U.S. agricultural attache in Cairo said in a report released on Tuesday.
"Based on reduced area, total production is forecast at 430,000 bales while exports are expected to drop to 360,000 bales," said the report. "Imports are expected to increase to 530,000 bales."

Monsoon Worst Since 2009 Threatening Sugar, Rice Crops (Source: Bloomberg)
The worst start to the monsoon season in India in three years is threatening crops from rice to sugar cane, stoking concern that the South Asian nation may limit exports to preserve supplies to meet local demand. Rainfall from June to September, which represents 70 percent of annual amount, may be below normal with the main cane-growing regions getting less rain than required, said Michael Ferrari, a commodity director and senior scientist at Falls Church, Virginia-based Computer Sciences Corp. (CSC) Rain is 22 percent below average since the season started on June 1, according to the India Meteorological Department.
Dry weather from the U.S. to Australia has parched fields, pushing up corn and wheat prices by as much as 16 percent this month in Chicago and curbing a decline in global food costs. El Nino weather conditions, which can parch Asia and bring cooler weather to the U.S, may develop some time during July to September, the World Meteorological Organization said June 26. India extended a ban on exports of sugar, rice and wheat in 2009, following the weakest monsoon since 1972.

Oil- Oil falls on Europe anxiety, strike supports
LONDON, June 27 (Reuters) - Brent crude oil fell on mounting concerns that European leaders would fail to solve the region's intractable debt crisis at a key meeting this week, offsetting tighter North Sea oil supply.
"The global supply and demand, or macro concerns on Europe have not really changed, hence it might be difficult to carry on the move of yesterday in crude oil," said Olivier Jakob at Petromatrix in Zug, Switzerland.

Norway won't halt oil worker strike for now
TRONDHEIM, Norway, June 27 (Reuters) - Norway does not plan to halt a strike by the country's oil workers and may change its stance should the strike escalate, labour minister Hanne Bjurstroem said on Wednesday.
"We are not at all at a point where intervention is on the agenda," Bjurstroem told Reuters. "My responsibility is to ensure this strike does not have large consequences for society. If it did, that would give us cause for intervention."

Oil supply surge could risk price collapse-Harvard analysis
WASHINGTON, June 26 (Reuters) - Global oil supplies are growing so fast that they could outstrip demand and lead to a collapse in world prices, a former energy executive who is now a Harvard research fellow said on Tuesday.
"Most analyses today are still marked by this obsession with oil running out," Leonardo Maugeri, formerly a senior manager at Italy-based oil and gas giant Eni SpA , said at a discussion at the Center for Strategic and International Studies think tank in Washington.

Oil Climbs a Third Day on Economic Outlook, Norway Strike (Source: Bloomberg)
Oil gained for a third day in New York after reports signaled fuel demand is increasing amid an economic recovery in the U.S., the world’s biggest crude user. Futures climbed as much as 0.4 percent after closing at the highest price in a week yesterday. U.S. home sales and durable- goods orders beat forecasts, government data showed, easing concerns the world’s largest economy is faltering. Gasoline demand rose last week, according to the Energy Department. Brent crude advanced a fourth day in London as a strike by Norwegian energy workers over pensions halted about 15 percent of the country’s oil output. Crude for August delivery increased as much as 35 cents to $80.56 a barrel in electronic trading on the New York Mercantile Exchange, and was at $80.41 at 9:42 a.m. Sydney time. The contract yesterday gained 1.1 percent to $80.21, the highest close since June 20. Prices are down 22 percent this quarter, the biggest drop since the final three months of 2008.
Brent oil for August settlement rose 48 cents, or 0.5 percent, to $93.50 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark’s premium to West Texas Intermediate closed at $13.29. U.S. orders for goods meant to last at least three years rose 1.1 percent in May, the first increase since February, a Commerce Department report showed yesterday in Washington. Pending home sales climbed 5.9 percent after slumping 5.5 percent in April, according to the National Association of Realtors.

Oil Over $100 Seen on Iran After Worst Quarter Since ’08 (Source: Bloomberg)
Brent crude is set to recover from its worst quarter since 2008 as a European Union ban on Iranian oil takes effect, central banks act to protect growth and on speculation OPEC will curb some of its excess supply. Brent, the second-worst performer between April and June in the Standard & Poor’s GSCI commodity index, is forecast to rebound to an average $114.50 a barrel in the third quarter, according to the median estimate of 32 analysts tracked by Bloomberg. BNP Paribas SA, Deutsche Bank AG and Barclays Plc predict $110, $115 and $121 a barrel, respectively. Prices slipped as low as $88.49 last week. “We do look for a rebound and feel that the oil price has gone beyond economic fundamentals,” Michael Lewis, Deutsche Bank’s head of commodities research in London, said by phone on June 26. “We are in quite an extreme level of investor pessimism, which would only seem to us justified if the U.S. was going back into a recession.”
The prospect of a rebound in prices driven by sanctions on Iran illustrates the readiness of the U.S., Europe and their allies to suffer higher fuel costs in order to curb the Islamic republic’s nuclear program. The EU, Iran’s biggest buyer after China, stops importing the nation’s oil July 1. While reflecting an improvement in demand as major economies tackle the impact of Europe’s sovereign debt crisis, rising prices may also pose headwinds to a recovery.

Gold Falls on Concern Europe’s Crisis Will Boost Dollar (Source: Bloomberg)
Gold in New York advanced for the second time in three days on speculation that China may take more steps to boost economic growth. China may introduce “more proactive” policies to ensure stable growth, the China Securities Journal said in a commentary today. The Asian country will topple India this year as the world’s largest consumer because rising incomes will bolster demand, the World Gold Council has forecast. European leaders will meet tomorrow in another attempt to find a solution to the region’s debt crisis. “The Chinese news is positive for gold,” Adam Klopfenstein, a market strategist at Archer Financial Services Inc. in Chicago, said in a telephone interview. “The gains will be limited as some investors are waiting for some kind of statement from the European leaders.”
Gold futures for August delivery rose 0.2 percent to settle at $1,578.40 an ounce at 1:47 p.m. on the Comex in New York. The precious metal has fallen 5.6 percent this quarter, heading for the biggest such decline since 2004, as the dollar gained and the Federal Reserve refrained from announcing further debt purchases. Prices surged 70 percent from the end of December 2008 to June 2011 as the Fed kept borrowing costs at a record low and bought $2.3 trillion of debt in two rounds of so-called quantitative easing.

20120628 1000 Soy Oil & Palm Oil Related News.

Pro Farmer: After the Bell Soybean Recap (Source: CME)
Soybean futures softened into the close to finish mixed. Nearbys closed fractionally higher, with new-crop futures ending roughly 1 to 5 cents lower on light profit-taking pressure. Meal also ended mostly lower, while soyoil closed higher. Early strength was tied to weather concerns, as a heat dome is building across the Corn Belt -- increasing stress on the crop. But in late trade, strength in the dollar and nervousness ahead of USDA's key Friday reports triggered a round of profit-taking.

Soybean Complex Market Recap (Source: CME)
August Soybeans finished up 1/2 at 1456, 25 1/2 off the high and 4 up from the low. November Soybeans closed down 1 1/4 at 1412. This was 3 1/4 up from the low and 27 3/4 off the high. August Soymeal closed down 0.5 at 423.7. This was 1.9 up from the low and 6.3 off the high. August Soybean Oil finished up 0.48 at 51.54, 0.39 off the high and 0.72 up from the low. Soybeans were trading slightly lower towards the end of the day. November soybeans posted new highs for the move and new contract highs before retreating to the bottom end of today's range. August soybean oil traded 44 cents higher while August soybean meal traded 20 cents lower. Speculative profit taking and producer selling was noted, ahead of the USDA reports for Friday. Soybean futures pushed higher this morning on a scorching heat forecast and support from the corn market. Weather forecasts call for 100 degree temperatures for the central and southern Midwest today and tomorrow. The two week weather forecast calls for above normal temperature and below normal rainfall for most of the Soybean Belt. The trade continues to monitor crop and weather conditions but expect further deterioration in the new crop soybean yield if weather patterns in July reflect those of June. The U.S. Dollar and stocks are trading higher midday ahead of the European Summit on Thursday. The USDA will release its Grain Stocks and Planting Intentions on Friday. Traders will key off the soybean planted acreage report but will likely believe that the acreage estimate from the USDA will be too high as many parts of the Midwest will not be able to double crop soybeans over harvested wheat due to topsoil dryness. Traders are penciling in an increase of 1.6 million acres. The March report estimated planted acreage at 73.9 million acres.

U.S. Farmers Facing Reality Check as Drought Hits Corn, Soybeans (Source: CME)
Springtime optimism has devolved into summertime angst for farmers such as Chris Barron, who’ve been forced to scale back once-lofty expectations for their corn and soybean crops as drought expanded across much of the U.S. Midwest.  Barron said his cropland, near Cedar Rapids in northeastern Iowa, received about 0.94 inch of rainfall so far in June, or about 20 percent of the 30-year average for the month. He’s trimmed his harvest outlook accordingly, with his corn and soybean plots likely generating yields 7 percent to 10 percent below what he estimated a few months ago. “We’ve got the potential for an average crop,” said Barron, a member of a farmer partnership that raises crops on about 7,000 acres. “The opportunity to have an above-average crop is gone. That’s just the reality.”
As farmers and grain traders await updated U.S. Department of Agriculture acreage data June 29, extreme heat and dryness has shifted squarely into market focus. Intensifying weather concern ignited a rally in CME Group grain markets, sending corn futures up over 20 percent since mid-June, and analysts say the market may have further upside if dryness continues. Drought threatens to undercut the benefits of an unusually warm and dry spring that likely led to the largest combined corn and soybean planted acreage on record.

VEGOILS-Palm eases ahead of EU meet, U.S. weather in focus
SINGAPORE, June 27 (Reuters) - Malaysian crude palm oil futures edged down as investors bet a summit of European leaders later this week is unlikely to resolve the region's lingering debt crisis soon.
"There's no new lead in terms of local sentiment, that's why the market is locked in a range of 3,000 to 3,050 ringgit. Immediate support is at 3,000 ringgit," said a trader with a foreign commodities brokerage in Malaysia.

Argentine soy crushing down 6.4 percent in May
BUENOS AIRES, June 26 (Reuters) - Argentina crushed 3.8 million tonnes of soybeans in May, down 6.4 percent from a year ago, marking the third straight month of declines, the Agriculture Ministry said in its latest crushing report.
The South American country is the world's top exporter of soyoil and soymeal, as well at its No. 3 supplier of soybeans. This season's yields have suffered from a six-week drought that parched the Pampas grains belt in December and January.