Tuesday, July 10, 2012

20120710 1813 FCPO EOD Daily Chart Study.

FCPO closed : 3130, changed : -23 points, volume : higher.
Bollinger band reading : pullback correction upside biased.
MACD Histogram : weakenning, buyer taking profit.
Support : 3100, 3070, 3050, 3020 level.
Resistance : 3150, 3200, 3250, 3270 level.
Comment :
FCPO closed recorded loss with better volume distibuted. Soy oil currently retreat little lower after overnight rallied higher by more than 2% while crude oil price currently trading lower.
Price retreated today probably due to ITS cargo surveyor reported surprisingly bigger dropped in exports for the period of 1~10 July, another cargo surveyor SGS data have yet to announce. Jun official data release seem looks postive biased with lower production, inventories level plus improving exports.
From daily chart point of view, market still having a pullback correction within an upside biased market development.
When to buy : buy at support or weakness with larger cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20120710 1721 FKLI EOD Daily Chart Study.

FKLI closed : 1629.5 changed : +9.5 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histogram : resume rising, buyer in control.
Support : 1620, 1610, 1600, 1590 level.
Resistance : 1630, 1640, 1650, 1660 level.
Comment :
FKLI closed recorded gain reaching new year high with better volume traded doing 5 points premium compare to cash market that closed little higher. Overnight U.S. markets closed weaker and today Asia markets ended mostly lower while European markets currently registering gains.
Regional market having mixed reaction after news on Spain's banks will get accelerated $100 billions euros from European government, China trade data reported 3 years high trade surplus with better than estimate exports and slower than anticipated imports amid sign of slowing demand from China adding pressure for further stimulus while overnight U.s. reported higher than median estimate consumer credits.
Back home, FKLI daily chart study revised back to suggesting an upside biased market development testing higher resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20120710 1706 Regional Markets EOD Daily Chart Study.

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

20120710 1616 Global Market & Commodities Related News.

Market Briefs
• Swiss Jun Unemployment Rate adj 2.9% vs prev 2.9% (rvsd).
• EZ Jul Sentix index -29.6 vs prev -28.9. -26.7 exp
• 54% of Germans think almost futile to fight to save euro if additional billions are required (TNS poll for Spiegel Online)
• 49% of Germans want Greece to leave euro - Emnid Institute poll (Focus magazine/Ekathimerini)
• Merkel Wrestles with Court over Europe's Future (Spiegel Online)
• Swiss cenbank must defend franc cap at all costs (Zeitung Newspaper)
• BAE bids to land £7bn US jet project (Sunday Telegraph)
• Gulf rivals vie for Marrriotts (Sunday Times)
• Chinese Wen calling for more aggressive efforts with economic policies
• Chinese Wen - economy stable but facing downward pressure, vows to keep property curbs (Xinhua)

GLOBAL MARKETS: Asian shares fell after Chinese import growth slowed sharply in June, underscoring weakness in domestic demand in the world's second-largest economy and adding to concerns about deteriorating global economic conditions. European shares were expected to open little changed after four straight sessions in the red, as a positive start to the U.S. earnings season was largely offset by new signs of an economic slowdown in China and concerns about the effectiveness of Europe's crisis-fighting measures. U.S. stocks slipped in light trading on Monday, weighed down by weak economic data from Asia and signs of economic trouble in Europe, underscored by higher Spanish and Italian bond yields. The Dow ended down 0.28 percent. The S&P’s 500 Index was down 0.16 percent. Nasdaq closed down 0.19 percent.

FOREX: The euro fell and hovered near a two-year low after a meeting of euro zone finance ministers offered no positive surprises, while the Australian dollar sagged after  disappointing Chinese import data. The euro dipped 0.2 percent from late U.S. trade to $1.2294, edging back in the direction of a two-year low of $1.2225 hit the previous day on trading platform EBS.

FOREX-Euro falls, euro zone meeting offers little relief
SINGAPORE, July 10 (Reuters) - The euro fell and hovered near a two-year low on Tuesday after a meeting of euro zone finance ministers offered no positive surprises, while the Australian dollar sagged after  disappointing Chinese import data.    
Euro zone ministers agreed to grant Spain an extra year -- until 2014 -- to reach its deficit reduction targets in exchange for further budget savings and set the parameters of an aid package for Madrid's ailing banks.

China trade surplus jumps as import growth falters
China's June trade data on Tuesday stoked anxiety about the strength of domestic demand in the world's second biggest economy as imports rose at only half the pace expected, signalling a need for Beijing to do more to bolster growth.

COLUMN-China June commodity import weakness is payback
--Clyde Russell is a Reuters market analyst. The views expressed are his own.--
LAUNCESTON, Australia, July 10 (Reuters) - If you take China's June commodity imports in isolation, they look very bad indeed with sharp declines in crude oil, iron ore and copper.
But one month of poor numbers doesn't mean the world's largest commodity consumer is in the midst of an economic hard landing, nor does it necessarily signal the start of sustained weakness.

US SEC finalizes derivative definition rules
U.S. securities regulators on Monday finalized rules that define what kinds of derivatives products will be regulated under the new regime created by the 2010 Dodd-Frank Wall Street reform law.

Hedge funds plow most into commods in 2 yrs as Q3 dawns
Hedge funds and other big commodity investors pumped a notional $13 billion into U.S. energy, grains and metals markets in the week to July 3, the biggest influx in at least two years, after a debt deal in Europe sparked a buying frenzy across the sector.

GRAINS: Chicago corn slid 1.2 percent, giving up some of last session's strong gains as investors squared positions ahead of a key U.S. supply-demand report, though deteriorating crop conditions continued to offer support. CBOT new-crop December corn had lost 1.2 percent to $7.21-1/4 a bushel, after hitting a contract high of $7.33 a bushel the day before. The most-active November soy fell 0.6 percent to $15.38-1/2 a bushel, while the spot contract slid 0.8 percent after climbing to a record top of $16.79-1/2 a bushel in the last session.

Corn, soy ratings plunge due to dryness, heat -USDA
U.S. corn ratings last week notched their biggest decline in nearly nine years as plants withered in parched Midwest soils during a critical phase of development, severely reducing harvest expectations and keeping ratings near a 25-year low.

Norway intervenes to avert oil industry closure
Norway's government ordered on Monday a last-minute settlement in a dispute between striking oil workers and employers in a move to alleviate market fears over a full closure of its oil industry and a steep cut in Europe's supplies.

OIL: Brent crude below $99 a barrel over concerns about demand growth after Chinese crude imports weakened in June, while worries of supply disruptions eased after a halt in the labour strike at Norway's oil industry. Brent was down $1.98 to $98.34 and U.S. crude fell $1.29 at $84.70 a barrel.

China iron ore imports fall 8.7 pct in June from May
SHANGHAI, July 10 (Reuters) - China's iron ore imports fell 8.7 percent in June from the previous month, as the world's largest buyer cut shipments on tepid demand, while traders expect a further decline in bookings in July, given little recovery in steel prices.
Iron ore imports dropped to 58.31 million tonnes in June from 63.84 million the previous month, preliminary data from customs showed on Tuesday.

India may protect some stainless steel against China imports
GENEVA, July 9 (Reuters) - India is investigating a flood of Chinese imports of some types of stainless steel and may restrict the trade if it finds its own steelmakers have suffered as a result, according to a document published by the World Trade Organization (WTO) on Monday.
The probe into imports of the "300 series" of hot-rolled flat products was prompted by a complaint from Indian steel company Jindal Stainless Ltd , after China's share of India's import market for the products leapt from 10 percent to 50 percent over the past three years.

Indonesia's June refined tin exports dip 11 pct y/y- govt
JAKARTA, July 10 (Reuters) - Refined tin shipments from Indonesia, the world's top exporter, fell 11 percent in June to 9,646.7 tonnes from 10,875.3 t o nnes a year earlier, a trade ministry official said on Tuesday.  
Indonesian refined tin exports for June were 23 percent higher c ompared to May's figure of 7,866.2 tonnes.

Alcoa sees strong aluminum demand
NEW YORK, July 9 (Reuters) - Alcoa Inc's  quarterly revenue and profit beat Wall Street's expectations even though prices for its aluminum are at nearly two-year lows, and it forecast growing demand in the aerospace and auto sectors.
Chief Executive Klaus Kleinfeld said low metal prices were a result of the global economic malaise rather than any fault with market fundamentals.

BASE METALS: London copper edged down, weighed down by a 17.5 percent monthly fall in China's June copper imports, global economic worries and caution ahead of the release of China's GDP figures this week. Three-month copper on the LME had edged down 0.2 percent to $7,547.50 per tonne, after rising 0.4 percent on Monday. The most-active October copper contract on the SFE edged up 0.3 percent to 55,360 yuan per tonne, catching up with previous gains in London, after losing 1 percent on Monday.

China copper imports fall 17.5 percent on month in June
HONG KONG, July 10 (Reuters) - China's copper arrivals fell 17.5 percent in June from a month earlier, preliminary customs data showed on Tuesday, resuming a slowdown for much of this year due to falling demand for goods in the world's second-biggest economy.
The monthly fall was broadly in line with the expectations of traders and analysts as copper demand in the world's top consumer of the metal has mostly stayed weak this year, even though imports spiked in May.

PRECIOUS METALS: Gold prices edged down, pressured by a higher dollar as investors nervous about global economic growth piled into the greenback for safety. Spot gold dipped $1.46 to $1,585.19 an ounce. U.S. Gold futures contract for August delivery edged down 0.2 percent to $1,586.10.

Managed money ups gold net longs, cuts copper shorts
July 9 (Reuters) - Hedge funds and money managers boosted their bullish bets in U.S. gold futures and options by 30 percent in the week up to July 3 after a European deal to shore up banks and cut borrowing costs increased bullion's investment appeal.
Speculators also sharply cut their copper net shorts after prices rallied over 5 percent during the period covered, data from the Commodity Futures Trading Commission (CFTC)'s Commitments of Traders showed.

LME shareholders to vote on HKEx takeover July 25
LONDON, July 9 (Reuters) - London Metal Exchange (LME) shareholders will vote on July 25 on a 1.4 billion pound ($2.2 billion) takeover offer by the Hong Kong stock exchange , which could deliver a payout of 7.4 million pounds for the LME's chief executive.
The LME, the world's largest marketplace for metals including copper and aluminium, said in a statement on Monday it had set the date for the vote and sent documents to its shareholders on the takeover plan, including details of potential payouts for its executives.

METALS-LME copper edges lower after China trade data
SHANGHAI, July 10 (Reuters) - London copper edged down on Tuesday, weighed down by a 17.5 percent monthly fall in China's June copper imports, global economic worries and caution ahead of the release of China's GDP figures this week.
But some saw a silver lining in recent gloomy data and price falls, hoping these will lead to more stimulus moves by central banks, while others bet that copper prices have bottomed out.

PRECIOUS-Gold dips as gloomy growth outlook boosts dollar
SINGAPORE, July 10 (Reuters) - Gold prices edged down on Tuesday, pressured by a higher dollar as investors nervous about global economic growth piled into the greenback for safety.
The dollar index hovered near a one-month high hit earlier this week, while the euro edged lower towards a two-year low against the greenback, after China released weaker-than-expected imports data that suggested decreasing domestic demand in the world's second-largest economy.

20120710 1122 Global Market & Commodities Related News.

GLOBAL MARKETS-Shares nudge up, gains seen capped before China data
TOKYO, July 10 (Reuters) - Asian shares crawled higher after sharp losses the day before but gains were limited as investors, worried about a global economic deceleration, waited for Chinese trade data due later in the day that could set the tone for risk appetite.
"Import growth will be important and a reading above the 8-10 percent region would be supportive of commodity currencies," BNP Paribas analysts wrote in a client note.

COMMODITIES-Oil above $100 on Norway strike; soy at record highs
NEW YORK, July 9 (Reuters) - Commodities jumped on Monday, breaking from falling stock markets, as oil clambered back above $100 a barrel on threats Norway's oil industry was headed for shutdown and soybeans hit record highs on crop damage from heat.
"Commodities surely seem to be decoupling from the equity markets as investors concerns about the broader economy and potential monetary easing ar e d r iving them back into the security of hard assets," said Zachary Oxman, managing director with TrendMax in Encinitas, California.

OIL-Brent dips below $99 as Norway intervenes; China data eyed
TOKYO, July 10 (Reuters) - Brent crude fell below $99 a barrel as Norway's government intervened in a labor strike and ordered a last-minute settlement to prevent a full closure of its oil industry.
The strike over pensions, which began on June 24, had cut oil production from the world's No. 8 oil exporter by about 13 percent and kept oil prices on the boil.

Flagging world economy relying on unstable energy boost
LONDON, July 9 (Reuters) - As storm clouds gather over the global economy again at midyear, lower energy prices are one of the few flickering rays of light on the horizon - even if they too look increasingly ephemeral.
Economic activity and business and household confidence around the globe has tailed off badly again in the second quarter. The headwinds remain fierce, from imponderables related to the latest wave of the euro crisis and European banks' retrenchment to U.S. fiscal uncertainty and a spluttering of growth engines in the big emerging economies.

POLL-US crude stocks seen down on lower imports
July 9 (Reuters) - U.S. commercial crude oil stockpiles were forecast to have fallen for the third week in a row in the week to July 6 due to lower imports and higher refinery usage, a preliminary Reuters poll showed on Monday.
The six analysts polled forecast that domestic crude stocks fell by an average of 1.1 million barrels, with the biggest drawdown estimated at 3.0 million barrels.

Norway intervenes to avert oil industry closure
OSLO, July 10 (Reuters) - Norway's government ordered on Monday a last-minute settlement in a dispute between striking oil workers and employers in a move to alleviate market fears over a full closure of its oil industry and a steep cut in Europe's supplies.
The strike over pensions had kept crude prices on the boil with analysts expecting far quicker action by the government to stop the oil industry from locking out all offshore staff from their workplaces from midnight (2200 GMT) on Monday.

NATURAL GAS-US natgas futures end up 4 pct as forecasts turn warmer
NEW YORK, July 9 (Reuters) - U.S. natural gas futures ended higher on Monday, backed by technical buying after Friday's steep slide and slightly warmer extended weather forecasts that should stir more demand after a break this week from the recent heat wave.
"Today's price rally is a bit of short covering after Friday's decline coupled with a bit of positioning to what is likely to be a bullish injection report this week," Energy Management Institute's Dominick Chirichella said in a report.

EURO COAL-S.African prices dip, Aug trades at $88.50/T
LONDON, July 9 (Reuters) - Physical prompt coal prices fell slightly on Monday despite a rise in oil prices.
"The traders who had been buying most of the DES and Richards Bay cargoes haven't been much in evidence today but it is only Monday," one European trader said.

20120710 0950 Local & Global Economy Related News.

Malaysia : The government is conducting a two-year study on the country's manpower needs in collaboration with the World Bank, said Human Resource Minister Datuk Seri Dr S. Subramaniam. A database on all sectors, including in which sectors foreign workers were needed, would be developed from the study which started early this year and expected to end at the end of next year. The study will help assist the government in planning the workforce requirement and the kind of training needed to prepare the people for the job market, he added. (Bernama)

The OECD composite leading indicators (CLI) fell to 100.3 in May from 100.4 in Apr. The leading indicator for China fell to 99.2 from 99.4 in Apr, whilst India’s indicator fell to 97.8 from 98.0. (Reuters)

US President Barack Obama urged Congress to pass a one-year extension of Bush-era tax cuts for families making less than US$250,000 a year while letting rates to rise for higher earners. (Bloomberg)

US consumer credit rose US$17.1bn in May (a revised US$10bn in Apr), more than double the consensus of US$8.5bn. This was on the back of a US$8.0bn jump in revolving credit, the strongest gain of the recovery. (Bloomberg)

US Federal Reserve officials are discussing whether to start a quarterly monetary policy report to provide a clearer guide to their economic outlook and the likely course for policy. (Bloomberg)

The Eurozone July Sentix investor confidence indicator fell to -29.6 in Jul from -28.9 in Jun. (Bloomberg)

EU: Business confidence drops to lowest in three years
French business confidence dropped to the lowest in almost three years in June, increasing the likelihood of an economic contraction in the second quarter. Sentiment among French factory executives fell to 91, the lowest since August 2009, from a revised 92 in May, the Bank of France said in an e-mailed statement from Paris yesterday. Economists expected a reading of 92, according to the median of six estimates gathered by Bloomberg News. Business confidence, which last rose in December, has stagnated all year and yesterday’s decline suggests that Europe’s second-largest economy shrank 0.1% in the second quarter, the central bank said. (Bloomberg)

Spain will be given some relief from its austerity woes when its EU partners grant it extra time to meet its steep budget deficit targets for this year to 6.3% of GDP, from an earlier figure of 5.3%, which otherwise risk deepening its recession. In return Mariano Rajoy, prime minister, will commit to a fresh round of tax increases. (FT)

Spanish 10-year borrowing rates surged again above the danger level of 7.0%, whilst the yield on 10-year German debt fell to 1.312%. Of note, Germany’s and France’s short-term debt yielded negative rates, illustrating the gaping divide between eurozone nations in terms of fund-raising. (AFP, Bangkok Post)

China will cut retail gasoline and diesel-fuel prices for the third straight month, by Rmb400 to 600 a metric ton, or as much as 6.6% and 7.2% for gasoline and diesel, respectively. (WSJ)

China’s consumer price index rose by 2.2% yoy in Jun (3.0% in May), the lowest figure since the start of 2010. The inflation rate for 1H12 was 3.3%, well below the government's target of 4.0%. The producer price index fell 2.1% yoy in Jun (-1.4% in May), sharper than forecasts for a 1.9% decline. (AFP, Reuters)

Japan’s current-account surplus shrank 63% yoy to ¥215.1bn, less than half the consensus expectations of ¥493.1bn. (Bloomberg)

Japan’s machinery orders fell 14.8% mom in May (+5.7% in Apr), the biggest drop since 2001. Economists were expecting a 2.6% decline. On a yoy basis, the measure gained 1.0% (6.6% in Apr), undershooting consensus of 7.0%. (Bloomberg)

Singapore’s foreign reserves added US$5.67bn to US$243.38bn in Jun (US$237.71bn in May). (Bloomberg)

More FDI had flown into Thailand over the past few days, but it was not much when compared to that of the past two years, Bank of Thailand governor Prasarn Tairatvorakul said. (Bangkok Post)

Applications for Board of Investment (BoI) privileges in the first half of this year topped THB478bn, almost double the THB242bn in the same period last year. (Bangkok Post)

IMF managing director Christine Lagarde called Indonesia's economy "solid and encouraging," but said dark clouds may lie ahead due to global uncertainties. (WSJ)

To achieve the ideal infrastructure financing rate of 5% of GDP, Indonesia needs funds of Rp1.924tr by 2014, of which the government is only able to fulfill Rp560tr. (IFT)

The Philippines said it was seeking to increase royalties from mining companies while imposing more restrictions to protect the environment and local communities. (Philippine Daily Inquirer)

Vietnam invested US$3.45m in Laos during the first six months this year, ranking third in the list of leading investors in Laos, said deputy minister of Viet Nam's Planning and Investment Cao Viet Sinh. (Vietnam News)

20120710 0949 Malaysia Corporate Related News.

Several China-based automotive companies have expressed interests to tie up with local players to fast track their presence into Malaysia based on expectations that the revised National Automotive Policy (NAP) would liberalise the local automotive sector. A source familiar with the matter said priority would be given to companies with energy efficient vehicles (EEVs) capabilities - an area that the Government is emphasising to turn the country into an EEV hub.
“There are a number of players from China that are keen to tie up with Malaysian car companies. But not all can adhere to the Government's EEV standards,” the source told StarBiz. According to earlier reports, policies under the revised NAP are expected to include initiatives that would turn Malaysia into an EEV hub and liberalise the below 1,800cc segment to make it more attractive for new players. (Starbiz)

Steel players will make their views known to the International Trade and Industry Ministry (Miti) on Thursday regarding the findings of the study undertaken by Boston Consulting Group to resolve the long-standing issues plaguing the industry. The study would likely cover competitiveness, the existing steel policy, import and export duties, and the influx of cheaper imports. (Star Biz)

In yet another sign of the impending slowdown in the high-end property market, Sunway Bhd is deferring the launch of some of its projects worth RM500m that were initially slated to take off this year. The projects are related to Sunway Geo@Sunway South Quay and Sunway Velocity. The former has a GDV of RM1.85bn and the latter RM3bn. (Financial Daily)

MMC Corp Bhd plans to take Johor's water concessionaire, Aliran Ihsan Resources Bhd (AIRB), private in a deal valued at RM181.1m or RM1.84/share. AIRB, which is 62.8%-controlled by MMC, is the third largest supplier of treated water in the country.Its core subsidiaries are Southern Water Corp Sdn Bhd, Southern Water Technology Sdn Bhd, Southern Water Engineering Sdn Bhd and Aliran Utara Sdn Bhd. These companies are involved in the operation, maintenance and management of water treatment plants, rehabilitation of water treatment plants and construction of water works. The offer price of RM1.84 by MMC is a five per cent premium on AIRB's closing price of RM1.75 last Friday.(BT)

Four potential buyers, including Prudential and Manulife, have made it through the second stage of bidding for Aviva’s insurance business in Malaysia in a deal worth about US$500m. Aviva is selling its 49% stake in an insurance joint venture with CIMB Group as part of a global retreat. Potential buyers are attracted by CIMB’s 320 branches and the ability to sell insurance products to the bank’s customers. Also, CIMB could sell a significant portion of its 51% stake, allowing a new owner to control the business. (Star Biz)

Boustead Holdings’s subsidiary Mecuro Properties plans to raise RM900m in bonds, involving seven different classes of bonds consisting of four classes of senior bonds and three classes of guaranteed bonds. Mecuro Properties has received the preliminary ratings of the proposed issuance from RAM Rating Services. The assigned preliminary ratings are AAA, AA2 and A1 for the Senior Bonds whilst the Guaranteed Bonds have been assigned preliminary ratings of AAA(fg) and AA2(bg). (BT)

Coastal Contracts Bhd has secured sales orders worth RM446m for 10 offshore support vessel (OSV) units, its biggest orders since February last year Its executive chairman Ng Chin Heng said the latest contracts would "significantly" strengthen the group's vessel sales order book. Including the new contracts, the group now has about RM583m worth of vessel sales orders awaiting delivery to customers up to 2013. (BT)

Tan Sri Vincent Tan's beachfront project Lido Boulevard, thought to be abandoned, will start site mitigation works this week.It is estimated the entire development will have a gross development value of RM4bn.Overlooking the Strait of Johor, Lido Boulevard is an integrated residential and commercial waterfront development that spans 2.4km along the Tebrau Strait coastal line.The development starts right after the abandoned JB Waterfront City, Lot One, and ends just before the Marine Department. Little has been heard of the project after a portion of land which had been reclaimed caved in, resulting in the loss of a life in November 2010."We had to have a complete revamp after the whole incident. We took a bit more time to be more careful," Central Malaysian Properties Sdn Bhd (CMP) chief executive officer Khoo Boo Teng told BT recently. (BT)

Gamuda Land has purchased 4.86-acre free-hold land in Kelana Jaya for RM95m. It intends to develop the commercial plot into a mixed project of retail and office suits for RM600m. The average selling price for the residential component is RM750 per sq ft while the retail shops are estimate at RM800 per sq ft. The planning and content of this development is anticipated to be revealed in early 2014. (Star Biz)

Lysaght Galvanized Steel Bhd’s wholly-owned subsidiary, Lysaght Marketing Sdn Bhd, has been awarded additional works worth RM22.7m by Syarikat Pembenaan Yeoh Tiong Lay Sdn Bhd. Lysaght said the additional works pertained to its four existing subcontracts for the supply, fabrication, delivery, installation and handing over of antenna poles for the latter. (Starbiz)

Airod to spend RM170m on expansion into civil aircraft sector
Aircraft maintenance, repair and overhaul (MRO) company Airod SB will spend RM170m this year on expanding its civil aircraft capabilities as part of its plan to shift focus away from military contracts. Airod, a subsidiary of te National Aerospace & Defence Industries SB (NADI) has taken the decline in global military spending as an opportunity to expand its civil aircraft MRO business, Airod chief executive officer Datuk Kamil Aziz told reporters in Kuala Lumpur yesterday. The on-site facilities include a RM40m hangar, which upon its completion at the end of July, will be able to fit two narrow-body aircraft. The company is also drawing plans for a new engine overhaul facility. (Malaysian Reserve)

EPF takes up 54.93m shares in Parkson
The Employees Provident Fund (EPF) has acquired 54.93m shares of RM1 each in Parkson Holdings on 4 July 2012. The retirement fund said in a statement the nominees include Amundi Malaysia SB, Hwang-DBS (Malaysia) and Malayan Banking. Upon acquisition, EPF will be the fifth largest shareholder of Parkson, with 5.02% stake, after the Government of Singapore Investment Corp, Amsteel Mills SB, Jem Cheng Heng and the largest shareholder, Narajaya SB with a 300.3m shares or a 27.5% stake. (Malaysian Reserve)

Lifeline for Megasteel in the works
The much-awaited report on the restructuring of the steel industry has proposed that the financially strapped Megasteel SB be given at least another 12 months to put its house in order. The report, prepared by Boston Consulting Group (BCG) and commissioned by the Ministry of International Trade and Industry (MITI), suggested a deadline of mid-2013 for Megasteel to record positive cash flow by forming strategic collaborations with foreign partners and improving operational efficiency. Megasteel, the only flat steel producer in the country, has come under fire from industry players claiming that the hot rolled coils (HRCs) it produces are not priced competitively and have quality issues. (Financial Daily)

AirAsia: To offer more flights during Raya
AirAsia will increase its flight frequencies for selected cities to cater  for the increase in demand during the festive period of Hari Raya Aidilfitri. The low cost airline said the extra flights will be offered from August 15 to August 26. Among the destinations to enjoy the extra flights will be Kota Bharu (from 8 times to 9 times daily), Bintulu (from 2 times to 3times daily) and Medan from 5 flights to 7. These extra flights are available for booking now until July 15, with prices going as low as RM92 (one way). This year, Hari Raya is expected to fall on August 19. (Bernama)

Genting Bhd: Singapore to amend casino law
It was recently reported that the Singapore government, via the Casino Regulatory Authority (CRA) as well as its trade, home affairs, finance, and community development ministries, announced a slew of improvements to the 6-year-old Casino Control Act. It is now seeking feedback from the public starting yesterday till Aug 6. The key proposals included raising the maximum fine allowable for disciplinary action taken against casino operators to 10% of gross gaming  revenue from the current SG$1m limit. Another proposal involved junket operators, also known as “international market agents” (IMA), where the CRA would have the power to set a  cap on the commission payable to them by the casino companies.(StarBiz)

Guan Chong: Commissions 2nd Batam line
Guan Chong has commissioned a second production line at its plant in Batam, which takes the group's total annual capacity to 200,000 metric tonnes. It said the new 60,000 metric tonnes line brings the Batam facility's yearly output to 120,000 metric tonnes. The company also has a cocoa grinding plant in Pasir Gudang which is capable of producing up to 80,000 metric tonnes a year. MD and CEO Brandon Tay Hoe Lian said commissioning of the second production line marked a new corporate milestone for the group. He said aside from cocoa grinding facilities, the new line would also provide powder pulverising and butter deodorising capabilities. (Business Times)

KPJ Healthcare: Unit in Indonesian deal
KPJ Healthcare said its wholly-owned subsidiary,  Kumpulan Perubatan (Johor) Sdn Bhd (KPJSB), has entered into a related party transaction to acquire up to 80% equity interest in PT Khidmat Perawatan Jasa Medika (PT  KPJ Medika) in Indonesia for a total cash consideration of RM15.8m. KPJ said that KPJSB had already signed a conditional sale of shares agreement with Johor Corp, a major shareholder of KPJ, yesterday in relation to the proposed acquisition, which was expected to be completed by 4Q CY2012. (StarBiz)

Muhibbah Engineering: Bid to wind up APH heads to court
Asia Petroleum Hub’s (APH) main contractor on Monday issued a public notice that it will next week commence a winding up petition against the troubled company. This comes as APH’s appointed receiver and manager, PricewaterhouseCoopers (PWC), is seeking to carve out its assets for a restructuring scheme. Muhibbah Engineering is an unsecured creditor of APH. (Financial Daily)

Astral Asia: Unit secures grant for park development
Astral Asia  has secured a government grant via its wholly-owned subsidiary  Tasja Development Sdn Bhd to facilitate the phase one development of the Kuantan Hi-Tech Park.Astral said that Tasja had already signed the agreement with the Government and Bank Pembangunan Malaysia for a facilitation fund of RM57.5m for the phase one development of the 2,433.68-acre integrated industrial park. It added that work on the park was expected to start early next year. Tasja is to be the developer of the Kuantan Hi-Tech Park phase one project while  Syarikat Ladang LKPP Sdn Bhd (SLLKPP) was to provide land for the development. SLLKPP is 65%-owned by Astral and 35% by the Pahang state government agency Lembaga Kemajuan Perusahaan Pertanian Negeri Pahang. (StarBiz)

Hong Leong Bank: Hong Leong Bank to tap growing Gen Y market. Hong Leong Bank (HLBB) wants to capture a slice of the growing Generation Y (Gen Y) market with the launch of its sub brand mach by Hong Leong Bank yesterday. HLBB will invest MYR40m in the next two years to open 20 new branches for its new brand, said group MD Datuk Yvonne Chia at the launch yesterday. (Source: The EdgeDaily)

20120710 0941 Global Market Related News.

Asia FX By Cornelius Luca - Mon 09 Jul 2012 17:02:23 CT (Source: CME/www.lucafxta.com)
The appetite for risk was limited on Monday after imploding on Friday as a result of the weak non-farm payrolls report. The foreign currencies edged marginally higher after the European and commodity currencies sank on Friday. The US stock indexes declined slightly. The short-term outlook for most of the European and commodity currencies is sideways. The medium-term outlook for most of the foreign currencies is bearish. The LGR short-term model is short on the European currencies and yen.  Good luck!

US: The consumer credit surged by $17.1 billion in May following an upwardly revised increase of $10 billion in April.

Today's economic calendar
UK: BRC retail sales monitor in June
UK: RICS Housing price balance in June
China:   Trade balance in June
Australia: National Australia Bank's business confidence in June
Japan:  Consumer confidence index In June

Asian Stocks Snap Three-Day Drop As Alcoa Tops Estimates (Source: Bloomberg)
Asian stocks rose, with the benchmark regional index rebounding from its biggest drop in a month yesterday, as mining companies and trading houses gained after metal prices rose and industry bellwether Alcoa Inc. reported better-than-expected profit. Alumina Ltd. (AWC), an Australian maker of the material used to produce aluminum, rose 1.3 percent in Sydney. Itochu Corp., a Japanese trading company, climbed 1.1 percent in Tokyo. Iluka Resources Ltd. sank 1.1 percent in Sydney after Goldman Sachs Group Inc. removed the zircon producer from a buy list. Agile Property Holdings Ltd. may be active today in Hong Kong after its June sales contracts jumped 43 percent from a year earlier. The MSCI Asia Pacific Index (MXAP) rose 0.3 percent to 117.19 as of 9:34 a.m. in Tokyo, with more than three stocks gaining for each that fell. The index advanced before the open of markets in Hong Kong and China.
Alcoa, the largest U.S. aluminum producer, started the earnings season for companies in the Dow Jones Industrial Average, posting profit and sales that beat analysts’ estimates after an increase in orders from the auto and aerospace industries. Mining companies advanced after the London Metal Exchange Index of prices for six industrial metals climbed 0.8 percent yesterday, its first gain in four days.

Inflation at Two-Year Low Spurs Commodity Slump: China Overnight (Source: Bloomberg)
Chinese stocks traded in the U.S. fell the most in two weeks as energy and commodity producers slid, after inflation in the world’s second-largest economy eased to the lowest level since January 2010. The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese companies in New York slid 1.7 percent to 89.55, the most since June 25. Aluminum Corp. of China Ltd. dropped the most in two weeks as the metal’s prices retreated. PetroChina Co. and Cnooc Ltd. (883) tumbled for a third day. Yanzhou Coal Mining Co. (YZC), the country’s fourth-largest miner, posted the longest losing streak in a month as the price of thermal coal in the nation declined for a ninth week.
Government data showing the consumer price index rose 2.2 percent in June, the slowest pace in more than two years, follows the second interest-rate cut in a month last week. Premier Wen Jiabao said downward pressure on the economy is still “relatively large” and the government will intensify policy fine-tuning, the state-owned Xinhua News Agency reported on July 8. Economists estimate the Chinese economy expanded at the slowest pace in three years during the second quarter. “Investors in Chinese equities are stepping back,” Derrick Irwin, who helps manage $2.5 billion in the Wells Fargo Advantage Emerging Markets Equity Fund, said in an interview at Bloomberg’s New York headquarters yesterday. “It’s difficult to make money by betting around the margins of consensus, and the consensus is that China is slowing.”

Japan Stocks Advance as ECB Weighs Interest-Rate Cut (Source: Bloomberg)
July 10 (Bloomberg) -- Japanese stocks rose, snapping a three-day loss, after European Central Bank President Mario Draghi signaled policy makers may be open to another interest- rate cut. Canon Inc. (7751), a camera maker that gets 31 percent of its revenue in Europe, rose 0.7 percent. Furukawa-Sky Aluminum Corp. added 1.3 percent after industry bellwether Alcoa Inc. reported better-than-expected profit as it opened U.S. earnings season. Japan Prime Realty Investment Corp. lost 2.8 percent after announcing a share sale. The Nikkei 225 Stock Average (NKY) gained 0.5 percent to 8,938.86 as of 9:15 a.m. in Tokyo with about four stocks advancing for each that fell. The broader Topix Index advanced 0.4 percent to 767.28 after dropping 1 percent yesterday, the most since June 8. Gains may be limited as rising borrowing costs in Spain stoked concern about Europe’s debt crisis.
In Europe, “they come out with nice, encouraging things, and the market has a bit of rally,” said Matt Riordan, who helps manage about $6.5 billion at Paradice Investment Management Pty. in Sydney. “Then, immediately it becomes clear that there’s a long-term frame and you tend to find disagreements among different countries.”

S&P 500 Buy Ratings at High as Valuations Offset Profit (Source: Bloomberg)
The same securities analysts warning of the first decline in quarterly earnings since 2009 are also more bullish than ever on U.S. stocks. A total of 247 companies in the Standard & Poor’s 500 Index (SPX) have more buy ratings than sells and holds, a record in Bloomberg data starting in 2000. Bullish recommendations have been expanding even as Wall Street firms cut their forecast for second-quarter net income in the U.S. to a decrease of 1.8 percent from a gain of 2 percent in April, more than 10,000 estimates compiled by Bloomberg show. Earnings season began today with a report from Alcoa Inc. (AA) Bears say rising equity volatility, declining profits and the approaching U.S. presidential election mean the 4.5 percent drop in the S&P 500 since April will continue. Bulls say analysts are advising clients to buy because earnings are still on track to reach a record this year and the index is trading 16 percent below its average valuation since the 1950s.
“My picks aren’t based on one quarter,” Howard Rubel, a New York-based equity analyst at Jefferies & Co., said in a July 5 phone interview. “It’s not always captured in a headline how many pieces of judgment one needs to incorporate into a stock recommendation, and a quarterly earnings report is only one item. You have to look at things over a period of time.”

U.S. Stocks Post Longest Slump in 1 Month on Europe Woes (Source: Bloomberg)
U.S. stocks fell, giving benchmark indexes the longest slump in more than a month, after a jump in Spanish bond yields above 7 percent intensified concern about Europe’s crisis and as investors awaited Alcoa Inc.’s results. Alcoa advanced 0.2 percent at 5:46 p.m. New York time after earnings and revenue analysts’ beat estimates. Exxon Mobil Corp. (XOM) and DuPont Co. dropped more than 1.3 percent to pace losses among the biggest companies. The largest payment networks Visa Inc. (V) and MasterCard (MA) Inc. slumped at least 1.3 percent after being downgraded at UBS AG. Patriot Coal (PCX) Corp. plunged 72 percent before it filed for bankruptcy protection. The Standard & Poor’s 500 Index slid 0.2 percent to 1,352.46 at 4 p.m. New York time. The measure dropped 1.6 percent in three days for the longest slump since June 1. The Dow Jones Industrial Average lost 36.18 points, or 0.3 percent, to 12,736.29. Volume for exchange-listed stocks in the U.S. was 5.1 billion shares, 24 percent below the three-month average.
“It’s very concerning,” said Jeff Savage, regional chief investment officer for Wells Fargo Private Bank in Portland, Oregon. His firm manages $169 billion. “Seven percent is not a sustainable level of interest rates for Spain. That’s scary stuff. We can’t have one of our best trading partners going through terrible economic times and not having an effect on U.S. corporate earnings,” he said, referring to Europe.

European Stocks Fall for Fourth Day; Metro Leads Losses (Source: Bloomberg)
European stocks declined for a fourth day as Japanese machinery orders tumbled the most in a decade and Spanish bonds dropped before euro-area finance ministers meet in Brussels. Metro AG (MEO), Germany’s biggest retailer, sank to a three-year low as Chief Executive Officer Olaf Koch said restrained spending will have a “significant impact” on business. Telecommunications companies rallied as Nomura Holdings Inc. upgraded the industry. The Stoxx Europe 600 Index (SXXP) slipped 0.4 percent to 253.46 at the close of trading as the yield on Spain’s 10-year bonds climbed to more than 7 percent. The equity gauge has risen for five straight weeks, the longest winning streak since January, as the region’s policy makers eased repayment rules for Spanish banks and relaxed conditions for possible aid to Italy.
“The main themes on the market remain the debt crisis and where southern European rates are heading,” said Michael Borre, the chief equity analyst at Nordea Private Banking in Copenhagen. “That’s why we continue to expect markets to stay nervous and volatile this week.”

Emerging Stocks Drop Most in 2 Weeks on China Concerns (Source: Bloomberg)
Emerging-market stocks tumbled the most in two weeks after Chinese Premier Wen Jiabao said the world’s second-largest economy faces “relatively large” downward pressure. The MSCI Emerging Markets Index (MXEF) Index lost 1.1 percent to 935.66 by the close in New York, the steepest drop since June 25. Technology companies led the retreat with HTC Corp. (2498), Asia’s second-largest smartphone maker, sliding to a two-year low after profit declined. Power company OAO E. On Russia slumped 2.8 percent in Moscow while OAO Magnit, Russia’s largest food retailer by market value, surged the most in a week. Brazilian markets were closed for a holiday.
China’s Wen said the government will intensify fine-tuning of policies, the state-owned Xinhua News Agency reported yesterday. The nation’s inflation eased to a 29-month low in June, the National Bureau of Statistics said today in Beijing. Spanish 10-year debt yields topped 7 percent. U.S. employers added fewer workers to payrolls than forecast in June, a July 6 report showed. “The disappointing U.S. jobs data, which is key for consumption, and lower price gains in China all point to slowing growth,” Chu Moon Sung, a Seoul-based fund manager at Shinhan BNP Paribas Asset Management Co., which oversees about $28 billion, said by phone today. “It’s inevitable some developing countries that highly depend on exports will feel the pinch.”

Japan Stocks Advance as ECB Weighs Interest-Rate Cut (Source: Bloomberg)
July 10 (Bloomberg) -- Japanese stocks rose, snapping a three-day loss, after European Central Bank President Mario Draghi signaled policy makers may be open to another interest- rate cut. Canon Inc. (7751), a camera maker that gets 31 percent of its revenue in Europe, rose 0.7 percent. Furukawa-Sky Aluminum Corp. added 1.3 percent after industry bellwether Alcoa Inc. reported better-than-expected profit as it opened U.S. earnings season. Japan Prime Realty Investment Corp. lost 2.8 percent after announcing a share sale. The Nikkei 225 Stock Average (NKY) gained 0.5 percent to 8,938.86 as of 9:15 a.m. in Tokyo with about four stocks advancing for each that fell. The broader Topix Index advanced 0.4 percent to 767.28 after dropping 1 percent yesterday, the most since June 8. Gains may be limited as rising borrowing costs in Spain stoked concern about Europe’s debt crisis.
In Europe, “they come out with nice, encouraging things, and the market has a bit of rally,” said Matt Riordan, who helps manage about $6.5 billion at Paradice Investment Management Pty. in Sydney. “Then, immediately it becomes clear that there’s a long-term frame and you tend to find disagreements among different countries.”

FOREX-Euro edges off 2-year lows but stays vulnerable
LONDON, July 9 (Reuters) - The euro steadied after hitting a two-year low against the dollar early on Monday, looking vulnerable amid concerns euro zone finance ministers meeting later will merely highlight the limitations of anti-crisis measures agreed last month.
"The euro has moved a great distance in a short period and there is a risk of a bit of a correction. But unless it rises through $1.2410 it will still be worth fading any rallies," said Jeremy Stretch, head of currency strategy at CIBC.

Euro Near 2-Year Low Before French, Italian Production (Source: Bloomberg)
The euro traded 0.5 percent from its lowest level in two years before reports forecast to show manufacturing in France and Italy is weakening as Europe’s debt crisis threatens growth. The 17-nation currency was 0.6 percent from a one-month low against the yen ahead of a meeting of European Union finance ministers in Brussels today. The dollar remained higher versus its Australian and New Zealand counterparts after global equity losses yesterday boosted demand for the relative safety of the world’s reserve currency. “The euro is going to stay quite weak, particularly against the U.S. dollar and the yen,” said Joseph Capurso, a strategist in Sydney at Commonwealth Bank of Australia (CBA), the nation’s biggest lender. “The euro-zone is still in recession and it’s probably getting even deeper.”
The euro was little changed at $1.2312 as of 9:11 a.m. in Tokyo after sliding to as low as $1.2251 yesterday, the weakest since July 2010. The shared currency was at 97.93 yen from 97.95 yesterday, when it touched 97.43, the lowest since June 5. The dollar was little changed at 79.54 yen. It fetched $1.0202 per so-called Aussie after a 0.1 percent gain yesterday and traded at 79.60 cents per New Zealand dollar after rising 0.2 percent in New York.

Most-Accurate Forecasters on Euro Clash With Options Sign (Source: Bloomberg)
The world’s most-accurate foreign- exchange strategists say the worst is over for the euro this year, putting them at odds with traders who see more pain as the region’s economy shrinks and the sovereign debt crisis deepens. Led by Wells Fargo & Co. and Westpac Banking Corp. -- which correctly called the euro’s weakness last quarter -- the five best firms as measured by Bloomberg expect Europe’s 17-nation common currency to end the year at about $1.26, up from $1.2299 as of 12 p.m. New York time. That’s above the $1.24 median estimate in a survey of 55 strategists by Bloomberg News.
After sliding in April and May, the euro’s drop slowed in June against a basket of currencies tracked by Bloomberg as European Union leaders approved measures making it easier for Spain and Italy to obtain aid, setting the stage for greater fiscal cooperation in a region where five nations have sought bailouts. While strategists are optimistic, derivatives show traders are about the most bearish ever on the euro versus the dollar over the next 12 months compared with the next 90 days. “We expect within the ebb and flow of the European debt crisis that things will get better rather than worse this year,” said Nick Bennenbroek, the head of currency strategy in New York at Wells Fargo. “Not only were the decisions that were taken in June by European leaders positive, but we continue to see supportive movements from the central bank as well.”

Euro Rises From Two-Year Low as Finance Ministers Meet (Source: Bloomberg)
The euro advanced from a two-year low versus the dollar as finance ministers from the 17-nation currency bloc met to discuss measures to ease its debt crisis. The shared currency rose from the weakest in more than a month against the yen as European Central Bank President Mario Draghi signaled policy makers may be open to another interest- rate cut if the economic outlook warrants it. The dollar and yen gained earlier as machinery orders in Japan plunged and inflation in China declined, adding to concern economic growth is faltering and fueling demand for refuge. “What we’ve seen today is a bit of short covering,” Shaun Osborne, chief currency strategist at Toronto-Dominion Bank’s TD Securities unit, said in a telephone interview. “Euro-dollar is going to continue to slip lower with monetary policy in the euro zone so loose.” Short covering is when investors end bets an asset will decline.
The euro rose for the first time in four days, gaining 0.2 percent to $1.2313 at 5 p.m. New York time, after falling earlier to $1.2251, the weakest level since July 2010. The 17- nation currency advanced 0.1 percent to 97.95 yen after earlier touching 97.43 yen, the lowest since June 5. Japan’s currency strengthened 0.1 percent to 79.56 per dollar.

Aussie Dollar Trades Near One-Week Low Before Chinese Trade Data (Source: Bloomberg)
Australia’s dollar traded 0.5 percent from a one-week low before data forecast to show growth in exports and import slowed in China, the nation’s biggest trading partner. The so-called Aussie maintained a two-day decline against the yen ahead of a report that economists said will show a drop in French industrial production, adding to signs the global economy is losing momentum. Demand for New Zealand’s dollar was supported after data showed the country’s house prices climbed to a record last month and card spending increased. “China is still slowing,” said Imre Speizer, a strategist in Auckland at Westpac Banking Corp. (WBC), Australia’s second-largest lender. “Weak Chinese data will be negative for the Aussie dollar.” The Australian currency traded at $1.0208 as of 9:37 a.m. in Sydney, unchanged from the close in New York yesterday, when it touched $1.0155, the lowest since June 29. The Aussie was little changed at 81.22 yen, after falling 1.2 percent over the previous two days.
Speizer predicts the Australian dollar will drop below 99 U.S. cents over the next couple of months.

Consumer Credit in U.S. Rises by $17.1 Billion, Fed Says (Source: Bloomberg)
Consumer credit climbed more than forecast in May, led by the biggest jump in credit-card debt in almost five years that may signal Americans are struggling to make ends meet. The $17.1 billion increase, exceeding the highest estimate of economists surveyed by Bloomberg News and the largest this year, followed a $9.95 billion gain the previous month that was more than previously estimated, the Federal Reserve said today in Washington. Revolving credit, which includes credit card spending, rose by $8 billion, the most since November 2007. A pickup in borrowing coincides with a slowdown in hiring and declines in consumer confidence that indicate the job market is failing to spur enough gains in wages to cover expenses. Employers added fewer workers to payrolls than forecast in June while the jobless rate stayed at 8.2 percent.
“When the economy’s not doing well, that’s when you want the consumer to spend, and if it means borrowing to do that, then that certainly would be encouraged,” said Millan Mulraine, a senior U.S. strategist at TD Securities in New York, who projected credit would rise by $15 billion.

Fed Weighs Revamped Monetary Report as Guide to Policy (Source: Bloomberg)
Federal Reserve officials are discussing whether to start a quarterly monetary policy report to provide a clearer guide to their economic outlook and the likely course for policy. “We are talking a lot about it,” Philadelphia Federal Reserve Bank President Charles Plosser said in an interview on July 5. “The question is, can we put it together in a way that is coherent and makes sense and improves our communications?” Plosser serves on a committee created by Fed Chairman Ben S. Bernanke to consider how to better explain its decisions and policies to the public. Bernanke, who is scheduled to deliver his semi-annual testimony to U.S. lawmakers next week, has established an explicit inflation target and has started giving press conferences in a push to improve transparency.
“They have come a long way, and they need to complete the process,” said Frederic Mishkin, a Columbia Business School professor who served on the Fed board from September 2006 until August 2008. “You want to achieve accountability, but also have markets understand why you are doing what you are doing.” In another Bernanke innovation, Fed officials publish their forecasts for inflation, growth and unemployment four times a year, as well as their outlook for their key interest rate, albeit anonymously. For all their efforts, investors still have to guess how Fed policies will evolve as new data show the economy moving closer or further from their goals, Mishkin said.

Fed’s Lacker Sees ‘Tepid’ U.S. Growth, Not Recession Risk (Source: Bloomberg)
Federal Reserve Bank of Richmond President Jeffrey Lacker said that “some of the slowdown is real” for the U.S. economy though the reduction in growth isn’t severe enough to tip the economy back into a recession. “The numbers have been pretty tepid, we’re definitely experiencing a slowdown,” Lacker said today in a Bloomberg radio interview on “The Hays Advantage” with Kathleen Hays and Vonnie Quinn. “I don’t think this is fatal. I don’t think this is pushing us back into a recession right now.” Lacker, who has dissented from all four Federal Open Market Committee decisions this year, is at odds with colleagues on what the Fed should do to boost the economy. He said in a June 22 statement that he opposed the FOMC’s $267 billion extension of its Operation Twist program because it may spur inflation and won’t give the economy a significant boost. “We’re just in a situation where growth is going to fluctuate between somewhat satisfactory and disappointing,” Lacker, 56, said in today’s interview.
Lacker has said the Fed will probably have to raise rates in mid-2013, contradicting the FOMC’s statements this year that economic conditions will probably warrant “exceptionally low” levels of the federal funds rate at least through late 2014. U.S. central bankers cut the benchmark lending rate to a record- low range of zero to 0.25 percent in December 2008.

Fed’s Lacker Says U.S. May Be Close to Maximum Employment (Source: Bloomberg)
Federal Reserve Bank of Richmond President Jeffrey Lacker said the U.S. may already be close to maximum employment from a monetary policy standpoint and that policy makers can’t do much more to cut the jobless rate. “Given what’s happened to this economy, I think we’re pretty close to maximum employment right now,” Lacker said today in a Bloomberg radio interview on “The Hays Advantage” with Kathleen Hays and Vonnie Quinn. “That might be shocking. That might be surprising.” Fed policy makers believe the U.S. central bank has limited control over the jobless rate because the employment level is driven by “non-monetary factors that affect the structure and dynamics of the labor market,” according to the January statement from the Federal Open Market Committee. The jobless rate was unchanged at 8.2 percent in June.
Lacker, who has dissented from all four FOMC decisions this year, is at odds with colleagues on what the Fed should do to boost the economy. He said in a June 22 statement that he opposed the FOMC’s $267 billion extension of its Operation Twist program because it may spur inflation and won’t give the economy a significant boost.

Williams Says Slowdown Demands ‘Extraordinary’ Fed Vigilance (Source: Bloomberg)
Federal Reserve Bank of San Francisco President John Williams said the U.S. central bank must maintain “extraordinary vigilance” to see if the slowing economy requires additional monetary stimulus. “If further action is called for, the most effective tool would be additional purchases of longer-maturity securities, including agency mortgage-backed securities,” Williams said in a speech in Coeur D’Alene, Idaho today. Last month’s decision to extend the so-called Operation Twist program “will probably have a relatively modest impact.” Recent figures have fanned concern the economic outlook is dimming, with a Labor Department report last week showing employers added fewer workers to payrolls in June than forecast. The employment report may add to the case for more stimulus, after the Fed said last month that it’s “prepared to take further action” to reduce unemployment.
“The pace of growth has been frustratingly slow, and we’ve seen some loss of momentum in recent months,” Williams said at a joint convention of the Idaho, Nevada, and Oregon Bankers Associations. “I expect little progress toward maximum employment over the next year or more.”

Dealers Declining Bernanke Twist Invitation (Source: Bloomberg)
Wall Street banks are increasingly choosing to hoard their U.S. bonds rather than sell them to the Federal Reserve as speculation grows that a slowing economy and global financial turmoil will only make them more dear. The world’s biggest bond dealers offered an average of $7.2 billion in Treasuries a day to the central bank in June, down 40.5 percent from a high of $12.1 billion in October, data compiled by Bloomberg show. The amount tendered has fallen even as the dealers almost doubled their holdings of the securities. While the amount of marketable U.S. government debt outstanding has risen to more than $10.5 trillion, Treasuries are proving scarce in a world where five nations in Europe have sought bailouts, the U.S. economy is slowing again and China is weakening. That means interest rates on everything from mortgages to corporate bonds should remain at about record lows.
“People are not willing to sell Treasuries,” said Thanos Bardas, a managing director in Chicago at Neuberger Berman LLC, which oversees about $89 billion in fixed-income assets, in a June 28 telephone interview. “The data in the U.S. doesn’t look as good. The labor market has lost momentum. There will be more upside left in Treasuries despite the low levels of rates.”

Japan’s Once Dominant Finance Ministry Rises Again With Noda Tax (Source: Bloomberg)
Japan’s Ministry of Finance is back. The bureaucratic body that dominated the nation’s postwar boom before being stripped of powers in the 1990s amid corruption scandals and an economic slump, is regaining control thanks to a ruling party that promised to rein it in. The Democratic Party of Japan took office in 2009 pledging not to raise taxes and to curtail bureaucracy and devolve power to citizens. Last month, Prime Minister Yoshihiko Noda defied opinion polls and allowed the breakup of his own party to push through the ministry’s decade-old plan to double the sales tax. “The Ministry of Finance is not just on its way back to power, it’s already there,” said Yoichi Takahashi, a professor at Tokyo’s Kaetsu University and former finance ministry official. “Since the Democrats took over the administration, that has become obvious.”
The ministry’s tax victory is an echo of the influence it wielded when it helped orchestrate a 50-fold, export-led expansion in the economy between 1955 and 1990, in tandem with the trade ministry. The MOF’s diminished role during the stagnation of the two decades that followed is coming to an end as bureaucrats take advantage of the inexperience of DPJ lawmakers to expand influence on policy making, said Takahashi.

Luxembourg’s Mersch Appointed to ECB Six-Member Executive Board (Source: Bloomberg)
Luxembourg’s Yves Mersch, the euro region’s longest-serving central banker, was named to the European Central Bank’s Executive Board in a victory for German- style monetary rigor. Mersch, 62, was appointed by euro-area finance ministers at a meeting in Brussels yesterday, Guy Schuller, a spokesman for Luxembourg Prime Minister Jean-Claude Juncker, told Bloomberg News. He will move into the slot vacated by Spain’s Jose Manuel Gonzalez-Paramo, stripping Spain of its claim to a permanent seat on the Frankfurt-based central bank’s six-member Executive Board. Juncker chairs meetings of euro finance chiefs. After five months of wrangling, Mersch defeated a Spanish nominee, Antonio Sainz de Vicuna, head of legal services at the ECB, as well as Mitja Gaspari, former head of Slovenia’s central bank. As Luxembourg’s representative on the ECB’s wider policy- setting Governing Council, Mersch has earned a reputation as an inflation hawk. He is the only central banker in office continuously since the euro debuted in 1999. “Mersch will do his bit to reinforce the reputation of the ECB as an inflation fighter,” said Christian Schulz, senior economist at Berenberg Bank in London. “That could make markets nervous at times.”

Tucker’s Libor Testimony May Stoke Concerns About BOE Powers (Source: Bloomberg)
Bank of England Deputy Governor Paul Tucker’s account of his involvement in the Libor scandal stoked new criticism of the bank’s oversight failures as he struggles to stay in contention for its top job next year. Tucker told lawmakers on Parliament’s Treasury Committee yesterday that he didn’t follow up concerns about Libor rates in 2007 because it looked at the time like a “dysfunctional” market, not a “dishonest” one. Barclays Plc (BARC) was fined a record amount last month for manipulating Libor from as early as 2005. “My concern is that the BOE clearly couldn’t see the wood for the trees,” committee member Andrew Leadsom said in an interview after Tucker’s testimony in London. “The amount of talk there was about Libor, it’s slightly incredible that a central banker didn’t see it as something to investigate.”
As Parliament debates the bill that will hand the Bank of England control of financial regulation in the U.K., Tucker was drawn into the Libor scandal over a 2008 conversation he had with former Barclays Chief Executive Officer Robert Diamond. The issue has jeopardized his chances of replacing Mervyn King as governor of the Bank of England next year.

Draghi Signals ECB May Consider Another Rate Cut If Needed (Source: Bloomberg)
European Central Bank President Mario Draghi signaled policy makers may be open to another interest- rate cut if the economic outlook warrants it. “We have to look at what the situation is, the data and the developments, and then we will make up our minds on the Governing Council what to do,” Draghi told lawmakers in Brussels today when asked if the central bank could cut rates again. While the ECB never pre-commits, it will “do everything to maintain price stability -- from both sides -- in the euro area,” he said. The ECB last week cut its main interest rates by 25 basis points, taking the benchmark to a record low of 0.75 percent and the deposit rate to zero. Policy makers next decide on rates on Aug. 2. With the sovereign debt crisis threatening to tip the 17-nation euro economy into recession, some economists say the ECB may have to resort to unorthodox methods to stimulate growth.
“It would take a negative deposit rate, or the start of quantitative easing, to provide fresh stimulus,” said Nick Kounis, chief European economist at ABN Amro Bank NV in Amsterdam. “Both are areas where the ECB might not be willing to go at this stage.”

Tucker Says No Public Official Told Him to Lean on Barclays (Source: Bloomberg)
Bank of England Deputy Governor Paul Tucker said no government minister or official pressured him to instruct Barclays Plc (BARC) or any other U.K. commercial bank to lowball its Libor submissions during the financial crisis. “Absolutely not,” Tucker told lawmakers in London today, when asked if anybody from the civil service or the then Labour government leaned on him to ask banks to lower their Libor submissions. He also said some of a memo written by former Barclays Chief Executive Officer Robert Diamond after an October 2008 phone call between the two gave “the wrong impression.” Tucker’s two-hour testimony followed the record 290 million-pound ($449 million) fine imposed on Barclays last month for manipulation of the London interbank offered rate. The scandal, which Tucker described as a “cesspit,” has jeopardized his position as the front-runner to replace Mervyn King as governor of the Bank of England.
“I can’t be confident about anything after learning about this, this cesspit,” he said. “Self-certification is plainly open to abuse” and the government “should look at every single index that isn’t based on real transactions.”

Libor Scandal Seen Boosting NYSE Repo Futures (Source: Bloomberg)
The scandal impairing confidence in the London interbank offered rate, a benchmark for $360 trillion in securities, may drive demand for interest-rate futures that NYSE Liffe U.S. will start offering this month. The contracts on NYSE’s U.S. futures exchange will be tied to indexes that track movements in a $400 billion market where bond dealers that trade directly with the Federal Reserve finance securities holdings. The futures were developed to give banks a more direct method of hedging changes in the cost of those transactions, known as general collateral finance repurchase agreements, or GCF repos. Bankers and investors are debating whether alternatives to Libor exist as confidence in the benchmark diminishes following Barclays Plc (BARC)’s admission that it submitted false rates. Robert Diamond, who resigned as Barclays’s chief executive officer after the bank was fined 290 million pounds ($451.4 million), told British lawmakers last week that other banks lowballed their Libor submissions.
“Something like the GCF rate makes some sense to a lot of people because it is a prolific market, there are trillions of dollars in repo trades outstanding, and a lot of people use it,” Ira Jersey, an interest-rate strategist in New York at Credit Suisse Group AG, said in a telephone interview. “The futures have a pretty good chance” of succeeding, he said.

New Zealand House Prices Rise to Record, Card Spending Gains (Source: Bloomberg)
New Zealand house prices rose for a second month to a record in June while spending on debit, credit and store cards gained for a fourth month, adding to signs of a recovery in domestic demand. Prices gained 0.3 percent from May, when they increased 1.7 percent, according to an index published by the Real Estate Institute of New Zealand today. The value of transactions on electronic cards rose 0.4 percent from May, when it increased a revised 1 percent, Statistics New Zealand said in Wellington. Rising house prices and consumer spending last month indicate modest economic growth at the end of the second quarter after gross domestic product jumped 1.1 percent in the three months through March. Reserve Bank of New Zealand Governor Alan Bollard last month left the official cash rate unchanged at a record-low 2.5 percent and signaled interest rates may not change until next year, citing tame inflation and a weakened global outlook.
“The recovery in retail spending is likely to remain gradual,” Christina Leung, economist at ASB Bank Ltd. in Auckland, said in an e-mailed note. “We continue to expect the RBNZ will hold off raising the cash rate until at least March.”

Mexico’s Short-Term Rating Raised One Level to A-2 at S&P (Source: Bloomberg)
Mexico had its short-term foreign currency rating raised one notch to A-2 from A-3 at Standard & Poor’s as the company cited a change in critera. S&P affirmed Mexico’s BBB long-term rating, the second- lowest investment grade mark. The outlook is stable, the ratings company said today in a statement. The move “results from the revision of Standard & Poor’s criteria on the linkage between long-term and short-term ratings for sovereigns,” the company said in the statement. “The change in the short-term foreign currency rating on Mexico does not reflect an improvement in the sovereign’s short-term creditworthiness.” S&P said Mexico’s net debt is likely to hold at about 35 percent of gross domestic product, while economic growth will average 3.3 percent in the “following several years,” the statement said.

Mechel Leads Commodity Retreat on China Growth: Russia Overnight (Source: Bloomberg)
Russian stocks traded in New York posted the longest stretch of declines in a month, led by commodities producers, on concern the economic slowdown in China will erode demand for metals. The Bloomberg Russia-US Equity Index (RUS14BN) of the most-traded Russian companies in the U.S. fell for a third straight day for the first time since June 1. OAO Mechel, the country’s biggest maker of coking coal, dropped for a third day, while OAO GMK Norilsk Nickel (NILSY), Russia’s largest mining company, tumbled to the lowest in two weeks. Futures expiring in September on Moscow’s dollar-denominated RTS Index rose 0.2 percent to 134,765.
Russia, the world’s biggest exporter of nickel and palladium, said China accounted for about 10 percent of the country’s foreign trade in the first four months of 2012. Economists forecast the Asian nation’s gross domestic product expanded at the slowest pace in three years during the second quarter. Premier Wen Jiabao said the world’s second-largest economy faces “relatively large” downward pressure, the state- owned Xinhua News Agency reported on July 8. “China is a price-defining factor when it comes to commodities,” Andrey Tretelnikov, an analyst at Rye MAN & Gor Securities, said by phone from Moscow yesterday. “Chinese demand is crucial for commodities overall and for Russian mining stocks in particular.”

20120710 0941 Global Commodities Related News.

Bulls Lift Wagers by Most in Two Years After Rally: Commodities (Source: Bloomberg)
Speculators increased bullish commodity bets by the most in two years as prices rebounded from a bear market, boosted by a crop-damaging drought in the U.S. and moves by China and Europe to spur economic growth. Money managers raised their net-long positions across 18 U.S. futures and options by 33 percent to 963,447 contracts in the week ended July 3, Commodity Futures Trading Commission data show. While the Standard & Poor’s GSCI Index of 24 raw materials fell 0.3 percent since then, the measure has rallied 10 percent since reaching a bear market on June 21. Gains were led by corn, which climbed 33 percent, and wheat, which surged 22 percent.
The worst Midwest drought since the 1980s is wilting the U.S. corn crop, the world’s biggest, prompting Goldman Sachs Group Inc. to cut its forecast for yields. European Central Bank President Mario Draghi yesterday signaled policy makers may be open to another interest-rate cut after lowering the benchmark rate to a record last week. Chinese officials will intensify their response to an economic slowdown, Premier Wen Jiabao said, the official Xinhua News Agency reported July 8. “We’re still locked in a risk on, risk off battle,” said Dan Denbow, a fund manager at the $1.8 billion USAA Precious Metals and Minerals Fund (USAGX) in San Antonio. “It’s back and forth until there’s clarity on where the economy goes.”

DTN Closing Grain Comments 07/09 14:44 : Weather Remains Dry, Markets Remain Hot (Source: CME)
One of the sillier lines of comments following last Friday's lower day was that pressure came from forecasts of "cooler" temperatures across much of the Midwest this week. The reality is that rain isn't expected to fall anytime soon, and that recharged market bulls on Monday.

Pro Farmer: After the Bell Wheat Recap (Source: CME)
Wheat futures posted gains in the teens to low 20s at all three exchanges. That was near the middle of today's trading range. Wheat futures were boosted by strong gains in the corn and soybean markets today. With traders actively building weather premium into those markets, there is a reason for wheat to follow.

Wheat Market Recap Report (Source: CME)
September Wheat finished up 22 at 828 1/4, 16 1/2 off the high and 13 1/4 up from the low. December Wheat closed up 22 at 843 3/4. This was 13 3/4 up from the low and 15 off the high. Chicago wheat traded sharply higher today, taking out last Thursday's highs at 8.40 3/4 before settling into the mid-point of today's range. The strength in the wheat market stemmed from a sharply higher corn market as the trade continues to be concerned over the drought conditions in the Corn Belt and the effect on the new crop corn yield. Weather maps are showing a break from the record heat this week, but mostly dry conditions. This brought on a new round of buying in corn and wheat followed suit. Weekly export inspections for the week ending July 5th came in at 14.9 million bushels vs. 21.5 million bushels last week. Inspections currently stand at 8.7% of the USDA estimates vs. the 5 year average of 8.8%. Crop condition reports will be released this afternoon and the trade expects a slight downgrade in Spring Wheat conditions. Outside markets provided a mixed tone but wheat found support from the corn market and prospects of lower wheat production estimates for the Black Sea region on Wednesday's USDA report. September Oats closed up 16 at 377 3/4. This was 11 up from the low and 4 off the high.

Pro Farmer: After the Bell Corn Recap (Source: CME)
Corn futures soared again today, with many contracts touching their 40-cent daily trading limit at points throughout the session. July 2012 to July 2013 contracts settled just off their highs with gains of 30-plus cents. Traders were again focused on the weather and its crop implications. Traders expect recent heat and dryness to result in continued crop deterioration.

U.S. Corn Growers Farming in Hell as Midwest Heat Spreads (Source: Bloomberg)
The worst U.S. drought since Ronald Reagan was president is withering the world’s largest corn crop, and the speed of the damage may spur the government to make a record cut in its July estimate for domestic inventories. Tumbling yields will combine with the greatest-ever global demand to leave U.S. stockpiles on Sept. 1, 2013, at 1.216 billion bushels (30.89 million metric tons), according to the average of 31 analyst estimates compiled by Bloomberg. That’s 35 percent below the U.S. Department of Agriculture’s June 12 forecast, implying the biggest reduction since at least 1973. The USDA updates its harvest and inventory estimates July 11.
Crops on July 1 were in the worst condition since 1988, and a Midwest heat wave last week set or tied 1,067 temperature records, government data show. Prices surged 37 percent in three weeks, and Rabobank International said June 28 that corn may rise 9.9 percent more by December to near a record $8 a bushel. The gain is threatening to boost food costs the United Nations says fell 15 percent from a record in February 2011 and feed prices for meat producers including Smithfield Foods Inc. (SFD) “The drought is much worse than last year and approaching the 1988 disaster,” said John Cory, the chief executive officer of Rochester, Indiana-based grain processor Prairie Mills Products LLC. “There are crops that won’t make it. The dairy and livestock industries are going to get hit very hard. People are just beginning to realize the depth of the problem.”

Corn Market Recap for 7/9/2012 (Source: CME)
September Corn finished up 36 3/4 at 732, 3 1/4 off the high and 22 1/2 up from the low. December Corn closed up 37 at 730. This was 22 3/4 up from the low and 3 off the high. December corn pushed to levels not seen since April 2011 on a day that saw corn trade limit-up at one point. The sharply higher trade was linked to continued concern over the new crop corn yield with analyst estimates falling by the day. Crop Condition reports today are expected to show corn pollination near 50%, during a time where record temperatures were seen throughout the Midwest and topsoil moisture conditions are some of the worst ever recorded. Weather maps are showing a break from the record heat this week, but mostly dry conditions for the heart of the Corn Belt. The southeast and delta are expected to see showers this week but coverage and accumulation is expected to be low. Traders are bullish ahead of the crop condition ratings this afternoon as most feel they will be revised sharply lower with estimates ranging from a 5% to 8% drop in the good-excellent category. Weekly export inspections for the week ending July 5th came in at 22.8 million bushels vs. 22.2 million bushels last week. Inspections currently stand at 81.5% of the USDA estimates vs. the 5 year average of 82.1%. Outside markets provided a mixed tone with the U.S. Dollar trading lower and energies higher on the day. Corn has been able to trade limit-up on it's own bullish, supply fundamentals. Demand for corn remains sluggish with weakening exports and negative Iowa ethanol margins. September Rice finished up 0.205 at 15.26, 0.04 off the high and 0.1 up from the low.

Corn, Soybeans Surge as Hot, Dry Weather Menaces U.S. Crops (Source: Bloomberg)
Corn rose the most allowed by the Chicago Board of Trade and soybeans extended a rally to a four- year high as hot, dry weather in the past two weeks eroded prospects for output in the U.S., the world’s biggest grower of the crops. More than 50 percent of the growing region was stressed by temperatures that exceeded 95 degrees Fahrenheit (35 degrees Celsius) on at least six of the past 14 days, T-Storm Weather LLC said in a report. As of yesterday, more than 91 percent of the production area was dry at the topsoil level and 59 percent was at high risk of intense stress and lower yields, the Chicago-based analyst said. “The threat of irreversible yield losses from Midwest dryness” is boosting demand, Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana said in a report. “The extreme heat of this past week, when combined with very dry soils, has likely impacted pollination of corn in many areas of the Midwest with significant reductions in yield potential.”
On the CBOT, corn futures for December delivery, after the harvest, jumped 36.5 cents, or 5.3 percent to $7.295 a bushel at 10:40 a.m. Earlier, the price soared by the limit of 40 cents to $7.33, the highest for a most-active contract since Sept. 13. Soybean futures for November delivery gained 3.1 percent to $15.5775 a bushel after reaching $15.7125, the highest since July 15, 2008. The record high for a contract with the greatest open interest was $16.3675 on July 3, 2008. Soybean futures for July delivery, before the harvest, rose 2.9 percent to $16.67. Earlier, the price reached $16.795, the highest ever for any contract. The U.S. Department of Agriculture is scheduled to release forecasts on domestic production and global supply and demand on July 11. Traders and analysts surveyed by Bloomberg News projected smaller U.S. and world reserves. Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show.

GRAINS-U.S. grains strengthen on drought; corn jumps 3 pct
SYDNEY, July 9 (Reuters) - U.S. new-crop corn jumped 3 percent to a contract high, leading strong gains for the grain complex as unfavorable weather across the United State's Midwest persists, threatening crop yields further.
"We are seeing what is shaping up to be the worst drought in nearly two decades hitting the corn belt, which is spurring speculation as to what is going to happen to yields and the overall production outlook," Michael Creed, agribusiness economist at National Australia Bank said.

No hit to harvest from Russia floods-trade, analyst
MOSCOW, July 9 (Reuters) - Deadly floods that hit Russia's Black Sea coast on Saturday have wrought chaos on key road and rail links to Russia's main grain export outlet, but the impact on exports may be delayed as port stocks are high, trade and analyst sources said on Monday.
Russian Railways said it had halted rail traffic to Novorossiisk to repair a bridge southwest of Krymsk, by far the hardest hit of the towns hit when floodwaters came crashing down suddenly in the early hours of Saturday, killing at 171 people.

Dry skies threaten US corn crop as heat wave breaks
NEW YORK, July 9 (Reuters) - The withering U.S. corn crop is gaining some respite from a record heat wave this week but new weather forecasts offered scant signs of the rainfall it urgently needs to avoid the worst drought damage in nearly a quarter century.
As the majority of a near-record-size U.S. corn area is now set to enter the key phase of pollination, a period when hot and dry conditions can cause irrevocable damage, the lack of moisture threatens to extend a rally that has already propelled corn prices more than a third higher since mid-June.

Water quest should make EU look beyond thirsty wheat
NICOSIA, July 8 (Reuters) - European Union agriculture reforms have a role to play in making farmers use water wisely and eventually changing the crops they grow to less thirsty plants that can improve public health, the head of the European Environment Agency said.
Cyprus, one of the most water-stressed nations in the EU, is making water a priority during its six months as EU president. Debate will focus on a blueprint to safeguard supplies and linking water with other policy debates, such as Common Agricultural Policy (CAP) reform.

Novorossiisk halts grain exports due to rain
MOSCOW, July 7 (Reuters) - Russia's Black Sea port of Novorossiisk suspended grain exports on Saturday due to heavy rains, which resulted in floods that killed scores of people, a port spokesman told Reuters.
"We stopped the grain loadings. There are certain limitations for it due to rain," Mikhail Sidorov said.

Japanese corn buyers yet to cover Q4 supply-traders
SINGAPORE, July 9 (Reuters) - Millers in the world's top corn importer Japan need to buy 4 to 5 million tonnes, mostly for October-December shipment, to cover their needs to the end of the year after a rally in U.S. futures slowed purchases, traders said on Monday.
Importers have yet to cover most of their requirements for the last quarter of the year, the traders added.

Egypt's GASC in no rush to enter overseas markets
ABU DHABI, July 8 (Reuters) - Egypt, the world's largest wheat importer, said on Sunday it was in no rush to tap international grain markets due to its large stockpile of local wheat and the surge in prices following the worst U.S. Midwest drought in nearly a quarter of a century.
Another Middle Eastern wheat importer, Jordan, also said earlier on Sunday it had postponed a tender to buy 100,000 tonnes of wheat to July 17 as it awaits more reports on the U.S. crop situation.

SOFTS-Sugar firms, eyes on Russia floods, coffee slips
LONDON, July 9 (Reuters) - Raw sugar futures on ICE rose underpinned by adverse weather in top producers Brazil and India, while coffee edged down and cocoa inched higher in light volumes. Sugar futures rose as dealers eyed weather concerns in top producers including Brazil, where unseasonably wet weather has hampered the harvest, and India, where poor monsoon rains have caused worry.

Ivorian cocoa arrivals seen at 1,259,000 T by July 8
ABIDJAN, July 9 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast reached around 1,259,000 tonnes by July 8, exporters estimated on Monday, compared with 1,310,614  tonnes in the same period of the previous season.
Exporters estimated around 21,000 tonnes of beans were delivered to the West African state's two ports of Abidjan and San Pedro between July 2 to July 8, down from 24,897 tonnes in the same week a year ago.

India's 2012/13 cotton area seen down from last year-govt official
MUMBAI, July 9 (Reuters) - Area under cotton in India, the world's second-biggest producer, is likely to fall in 2012/13 from last year, Textile Commissioner A.B. Joshi told reporters on Monday, as other competing crops like soybeans gave farmers better returns.
The sowing of the fibre crop has started and in some areas poor rainfall affected the pace of sowing, Joshi said.

OIL-Brent rises towards $99 on Norway strike, China data
LONDON, July 9 (Reuters) - Brent crude oil climbed to around $99 a barrel as failed labour talks stoked worries of a full shutdown of Norwegian oil production, while hopes China would ease monetary policy also supported prices.
"The price-supporting effect of the oil strike in Norway will probably be only temporary in nature," said Carsten Fritsch, analyst at Commerzbank in Frankfurt.

Oil Declines From Two-Day High as Norway Orders End to Strike (Source: Bloomberg)
Oil dropped from the highest close in two days after Norway ended a strike by energy workers that had threatened to halt production by western Europe’s largest crude exporter. Futures slipped as much as 1.1 percent in New York after the Norwegian government ordered compulsory arbitration in the dispute, preventing a lockout of platform workers that was scheduled to start at midnight yesterday. Norway pumped 1.63 million barrels of oil a day in May, or about 1.8 percent of global consumption, data from the Norwegian Petroleum Directorate show. “Traders are probably taking the premium out of oil now that they think the strike will be settled,” said David Lennox, an analyst at Fat Prophets in Sydney. “It was looking like the strike was going to deteriorate further. That risk premium is certainly coming out of crude.”
Oil for August delivery fell as much as 98 cents to $85.01 a barrel in electronic trading on the New York Mercantile Exchange and was at $85.15 at 11:05 a.m. Sydney time. The contract climbed 1.8 percent yesterday to $85.99, the highest close since July 5. Prices are 14 percent lower this year.

Alcoa Beats Estimates as Carmakers Buy More Aluminum (Source: Bloomberg)
Alcoa Inc. (AA), the largest U.S. aluminum producer, reported second-quarter earnings and revenue that beat analysts’ estimates after an increase in orders from the auto and aerospace industries. The company had a net loss of $2 million, or break even on a per share basis, compared with net income of $322 million, or 28 cents, a year earlier, New York-based Alcoa said today in a statement. Profit excluding a charge related a proposed settlement of Aluminium Bahrain BSC (ALBH)’s lawsuit and other items was 6 cents a share, compared with the 5-cent average of 19 estimates compiled by Bloomberg. Sales fell 9.4 percent to $5.96 billion from $6.59 billion, exceeding the $5.81 billion average of 11 estimates.
Alcoa, whose customers include Ford Motor Co. and Toyota Motor Corp., is benefiting as car and truck makers are being compelled by regulations to produce lighter vehicles. The U.S. aluminum industry will ship 16 percent more aluminum to automakers in 2012 as car output climbs 11 percent, according to Lloyd O’Carroll, an analyst at Davenport & Co. in Richmond, Virginia. Aircraft manufacturers also face record backlogs as airlines hurry to refurbish aging fleets. “In their downstream business and midstream business, those two pieces we are seeing margin expansion,” Brian Yu, a San Francisco-based analyst at Citigroup Inc. who recommends holding Alcoa’s shares, said in a July 6 interview. “It’s a sign that, yes, the company is doing some things right.”

Copper Climbs on Bets More China Stimulus to Boost Demand (Source: Bloomberg)
Copper rose for the first time in three sessions on speculation that China will take more steps to spur its economy, bolstering the outlook for metals demand. Chinese officials will intensify their response to a slowdown in the country’s economy, Premier Wen Jiabao said. He spoke as government figures showed inflation reached a 29-month low. Goldman Sachs Group Inc. said copper usage probably will keep climbing in the Asian nation, the world’s top metals consumer. “Any indication that China may ease is encouraging,” William O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “Chinese inflation numbers were a bit on the low side, and that’s a plus for the market because it allows for accommodation” in monetary policy, he said.
Copper futures for September delivery gained 0.6 percent to settle at $3.4315 a pound at 1:17 p.m. on the Comex in New York. On July 6, the metal slumped 2.4 percent, the most in two weeks, after a report showed the U.S. added fewer jobs last month than economists had forecast. A 50 percent jump in June property sales in eastern provinces of China compared with a year earlier will support metals demand, according to Goldman Sachs. The Copper Development Association says construction accounts for about 40 percent of demand.

20120710 0940 Soy Oil & Palm Oil Related News.

ITS CPO export down 13.5% to 363,975 tonnes for the period of 1~10 Jul 2012.

MPOB Official Data for the month of Jul 2012 vs Jun 2012
Exports up 8.7% to 1.53 million tonnes
Stocks down 4.9% to 1.7 million tonnes
Output up 6.3% to 1.47 million tonnes

Pro Farmer: After the Bell Soybean Recap (Source: CME)
Soybean futures were higher throughout the day to post another round of fresh contract highs. While beans ended off session highs, most contracts still ended around 40 cents higher. Soymeal and soyoil saw strong spillover support.Weather continues to dominate price action. While temps have moderated across the Corn Belt, there's very little rain in the near-term forecast to provide relief from the widespread drought.

Soybean Complex Market Recap (Source: CME)
August Soybeans finished up 39 1/2 at 1606 3/4, 18 3/4 off the high and 23 1/4 up from the low. November Soybeans closed up 42 at 1547 3/4. This was 25 1/4 up from the low and 23 1/2 off the high. August Soymeal closed up 12.5 at 474.0. This was 6.7 up from the low and 5.3 off the high. August Soybean Oil finished up 1.12 at 54.56, 0.63 off the high and 0.92 up from the low. The soybean market traded sharply higher on the day with July soybeans setting a new all-time high of 16.79 1/2. August soybean oil rose $1.12 while soybean meal traded $12 higher. The lack of rain for the heart of the Midwest for the next week after the extreme heat of last week has traders expecting sharply lower yield potential for the soybean crop and this has sparked the aggressive buying in soybeans and corn. Weather maps are showing a break from the record heat this week, but mostly dry conditions. The southeast and delta are expected to see showers this week but coverage and accumulation is expected to be low. None-the-less, the rainfall should be beneficial to soybeans in these regions. Traders look for crop conditions for tonight's update to show good to excellent ratings drop to just 40% from 45% last week for the soybean crop and this compares with 66% last year and 64% as the 10-year average. Weekly export inspections came in at 18.9 million bushels as compared with 13.89 million last week and 12 million necessary each week to reach the USDA projection for the year. Outside markets provided a mixed tone with the U.S. Dollar trading lower, stocks were lower, and energies higher on the day.

VEGOILS-Global weather concerns lift palm oil futures
KUALA LUMPUR, July 9 (Reuters) - Malaysian crude palm oil futures rose on worries that unfavourable weather, from the United States to India, could crimp oilseed production and tighten global supply of cooking oil during a peak season for Asian demand.
"Palm oil is taking a free ride. It will take more of the market from soybean oil, especially during the festival season on  the Asian side," said a trader with a foreign commodities brokerage.