Tuesday, August 7, 2012

20120807 1813 FCPO EOD Daily Chart Study.

FCPO closed : 2907, changed : -11 points, volume : higher.
Bollinger band reading : downside biased.
MACD Histogram : resume falling, seller testing market again.
Support : 2900, 2850, 2800, 2770 level.
Resistance : 2920, 2950, 2970, 3020 level.
Comment :
FCPO closed weaker with better volume exchanged. Soy oil currently rebounding recovering big portion of yesterday more than 1% loss while crude oil price currently registering small gain after overnight climb.
Price traded lower on news of partial rains in America soybean planting area and trader stay cautions ahead of July Reuters polls and official data with the anticipation of slower exports and higher production and inventory levels.
Daily chart wise, technical reading revised to calling a downside biased market development possibly testing previous low support level near 2880.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with moderate cut loss and profit target.

20120807 1735 FKLI EOD Daily Chart Study.

FKLI closed : 1640.5 changed : unchanged, volume : higher.
Bollinger band reading : correction range bound little upside biased.
MACD Histogram : recovering, buyer still in.
Support : 1640, 1630, 1623, 1615 level.
Resistance : 1650, 1660, 1670, 1680 level.
Comment :
FKLI closed unchanged with little improved volume transacted doing 9 points premium compare to cash market that fall lower. Overnight U.S. markets closed firmer and today Asia markets ended mostly higher while European markets currently trading little higher.
Most regional markets reacted positively to Germany supported European Central Bank Bond buying program that ease the current Europe's debt crisis.
Daily chart reading still suggesting a correction range bound little upside biased market development.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20120807 1717 Regional Markets EOD Daily Chart Study.

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

20120807 1609 Global Markets & Commodities Related News.

GLOBAL MARKETS: Asian shares gained as investors maintained the hope that Europe will take further action to tackle its debt crisis and the United States and China will adopt stimulus measures to support recovery.  European shares were expected to edge lower. U.S. stocks closed at three-month highs for the second day in a row on Monday, extending last week's rally on the hope for more assistance for the troubled euro zone.  

FOREX: The euro held steady near a recent one-month high, supported by hopes that the European Central Bank will take action soon to lower borrowing costs for Spain and Italy.

FOREX-Euro pulls back from 1-mth high; Aussie edges higher
SINGAPORE, Aug 7 (Reuters) - The euro dipped versus the dollar and pulled back from a one-month high, but remained supported by expectations that the European Central Bank will take action soon to lower borrowing costs for Spain and Italy.
"I think the risk or the bias here is perhaps a bit more short squeeze in the euro to the upside," said Sim Moh Siong, FX strategist for Bank of Singapore, referring to the possibility of the euro getting a lift if traders with short positions in the single currency unwind their bearish bets.

ECB bond buys on hold as it prepares new programme
The European Central Bank kept a lid on its bond purchase programme last week as it presented plans to launch a new and more transparent scheme that will be tied to intervention by the European rescue funds and political action.

Australia central bank holds rates, sees stimulus working
Australia's central bank kept its main cash rate at 3.5 percent for a second month, saying it was too soon to gauge the full impact of past cuts while noting early signs the stimulus was working.

Shrinking U.S. crops pose inflation challenge for countries
For nations like China and India fighting to tamp down inflation while spurring growth, even as the global economy faces headwinds from Europe's debt crisis, shrinking U.S. crops could be an additional headache as food prices creep higher.

GRAINS: U.S. soybeans edged higher after losing almost 3 percent in the previous session as rain over some key growing regions of the U.S. Midwest eased concerns of further damage to new-crop supplies.

OIL: Brent crude held steady above $109 a barrel, on hopes that Europe would take further action to tackle its intractable debt crisis, while supply worries stemming from North Sea maintenance and Middle East tensions also supported prices.

Fire blazes at California refinery; residents ordered indoors
A massive fire struck at the core of Chevron Corp's large Richmond, California, refinery on Monday, spewing flames and a column of smoke into the air, threatening a prolonged outage that may increase prices of the costliest U.S. gasoline.

Peru's Antamina mine faces fallout from spill
Antamina, one of the world's biggest copper-zinc mines, is facing community opposition and government inquiries after its pipeline burst nearly two weeks ago exposing more than 200 people to a mineral slurry.

Bids scarce, China steel demand outlook stays weak
SINGAPORE, Aug 7 (Reuters) - Buying interest for iron ore cargoes from top consumer China remained thin on Tuesday as uncertainty over when steel demand will pick up depressed appetite for the raw material.
Benchmark iron ore prices, which hit their lowest in 31 months last week, could fall further amid ample spot supplies as miners continue to offer material, hoping some Chinese mills will return to the market to replenish inventories.

China daily steel output falls 2.2 pct in late July -CISA
SHANGHAI, Aug 7 (Reuters) - China's daily crude steel output fell 2.2 percent to 1.949 million tonnes on average over July 21-31 from July 11-20, data from the China Iron & Steel Association (CISA) showed on Tuesday.
China's steelmakers are stepping up maintenance in an effort to cut production and stem losses from a slump in steel prices and a surge in inventories.

BASE METALS: London copper edged down after two sessions of gains, though prices were underpinned by hopes the euro zone would adopt fresh measures to shore up its faltering economy, while traders looked ahead to a slew of data from top metals consumer China.

PRECIOUS METALS: Gold traded flat, retaining gains from the past two sessions as investors waited for action from the European Central Bank in hopes that it would do more to tackle the region's debt crisis.

METALS-Copper slips, but Europe hopes support
London copper edged down after two sessions of gains, though prices were underpinned by hopes the euro zone would adopt fresh measures to shore up its faltering economy, while traders looked ahead to a slew of data from top metals consumer China.
"Yesterday was mostly digesting last week's decent non-farm payrolls and the ECB (European Central Bank) comments. Today everyone is just waiting to see what is next," said commodities analyst Ivan Szpakowski at Credit Suisse in Singapore.

PRECIOUS-Gold steady as investors expect ECB action
Gold traded flat, retaining gains from the past two sessions as investors waited for action from the European Central Bank in hopes that it would do more to tackle the region's debt crisis.
"On the macroeconomic front, things haven't changed dramatically -- the U.S. economy is not doing too bad, and the European economy is a mess. The Fed is waiting for a perfect time to make a final strike with a third round of quantitative easing," said a Shanghai-based trader.

20120807 1528 Global Markets & Commodities Related News.

GLOBAL MARKETS-Shares steady on sustained policy hopes, eyes on RBA
TOKYO, Aug 7 (Reuters) - Asian shares steadied on Tuesday as investors maintained hope that Europe will take further action to tackle its debt crisis and the United States and China will adopt stimulus measures to boost growth.
"The bid to risk is likely to be sustained in coming weeks on the back of attractive valuations and market anticipation of policy action out of Europe, China and even the U.S.," Morgan Stanley said in a research note.

COMMODITIES-Markets up broadly, counting on ECB action; soy down
NEW YORK, Aug 6 (Reuters) - Oil prices climbed a second straight day on Monday and most other commodities rose too on investor hopes the European Central Bank would act on its pledge to help the euro zone.
Stocks on Wall Street hit three-month highs and the euro gained against the dollar as borrowing costs in Spain and Italy fell on hopes the ECB would buy short-dated bonds in Europe's most battered economies.

OIL-Oil hits 11-week high on strong equities, weak dollar
NEW YORK, Aug 6 (Reuters) - Oil prices rose for a second straight session on Monday, closing at the highest level in 11 weeks, as U.S stock markets rallied to a three-month high and as traders eyed ongoing turmoil in the Middle East.
"Equities moved higher and the dollar is a little lower and that may have been enough to stop the early profit taking after Friday's big jump," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.

POLL-US crude stocks forecast down on lower refinery activity
Aug 6 (Reuters) - U.S. crude oil stockpiles were forecast down last week for a second straight time on lower refinery activity, a preliminary Reuters poll showed on Monday ahead of industry and government data due this week.
Crude inventories were projected to have fallen by 500,000 barrels in the week to Aug. 3, according to the survey of seven analysts.

NATURAL GAS-US natural gas futures end up, first gain in 5 sessions
NEW YORK, Aug 6 (Reuters) - U.S. natural gas futures reversed course and ended higher on Monday, their first gain in five sessions, as technical buying after last week's steep slide offset early selling on milder weather forecasts and fading concerns about a Caribbean storm.
"We came down pretty hard after the recent high. Weather forecasts have turned bearish and there are no immediate storm threats, but it looked like some technical support today," said Steve Mosley at SMC Advisory Services in Arkansas.

EURO COAL-Prices rise by $1/T with oil, weak dollar
LONDON, Aug 6 (Reuters) - Physical prompt coal prices rose by around $1.00 a tonne on Monday in line with oil's gains and supported by expectations that strikes in Colombia would tighten supply into Europe, further boosting prices.
"A price of $91 a tonne is not a great number for a lot of producers still," one trader said.

20120807 1527 Local & Global Economy Related News.

The  inflow of foreign funds into Bursa Malaysia last week remained sizeable as foreign investors bought, on a net basis, RM308m (US$99.1m) worth of Malaysian stocks for the seventh consecutive week. For the year until 3 Aug the cumulative net inflow of foreign funds into Malaysian equities amounted to RM9.5bn (US$3.06bn). It was much higher compared with only RM1.9bn (US$611.46m) registered for the entire 2011, Malaysian Industrial Development Finance (MIDF) Research said. Meanwhile,  local retailers continued to be net sellers for the tenth consecutive week with sales declining to RM62m (US$19.95m), the lowest in seven weeks. The report revealed that the  participation rate also dropped significantly to RM747m (US$240.39m). (Bernama)

Malaysia’s participation at the recent  SEMICON West 2012 in San Francisco, California, generated sales of RM333.78m against sales of RM22m chalked up at the same event last year. The Malaysia External Trade Development Corp (Matrade) said the event, held between 10 July and 12 July, was the flagship event for microelectronic manufacturing and semiconductor industries. Matrade said worldwide spending on semiconductor fabrication equipment this year was expected to amount to RM124.12bn and RM145.42bn next year, an all-time record high for fabrication equipment spending. (Bernama)

US Federal Reserve Chairman Ben Bernanke  said that although broad measurements of the economy like consumer spending, disposable income, ousehold net worth and debt service payments point to recovery, many people and businesses are facing tough times. (Reuters)

The  US Federal Reserve  said  banks continued to ease lending standards for larger firms in the last three months but small businesses are still having a hard time accessing credit. (Reuters)

The IMF, facing discontent among its members about the huge sums it has lent to the euro zone, is pushing the currency bloc's governments to take steps to lighten the burden of the  bailout loans they made to  Athens, officials familiar with continuing discussions said. (WSJ)

Eurozone’s sentix investor confidence fell by 0.7pt to -30.3 in Aug (-29.6 in Jul), the fifth consecutive month of decline and the lowest in more than three years. Economists had forecast the index to fall to  -31. The  expectations index rose to -23.3 from -24 in July, whilst current conditions fell to -37 from -35. (RTTNews)

Japan’s coincident index fell a preliminary 2.0pts mom in Jun (-1.2pt in May), the third straight month of decline, whilst the leading index fell 2.6pts mom (-0.4pt in May). The  Cabinet Office thus downgraded its view on the coincident index, saying it is stalling. That compared with its previous view that the index was showing an improvement. (Reuters)

India's new pro-market  finance minister P. Chidambaram pledged to take steps to restore foreign investors' faith in Asia's third-largest economy and "restart the growth engine". (AFP)

Indonesia’s GDP growth last quarter was 6.4% yoy against 6.3% in the first quarter, helped by domestic consumption and investment. GDP grew by 2.8% qoq (1.4% in 1Q12). (Reuters, Bloomberg)

Indonesia’s consumer confidence index inched lower to 113.5 in Jul from 114.4 in Jun. (Bloomberg)

20120807 1526 Malaysia Corporate Related News.

Felda Global Ventures Holdings Bhd (FGV) is reorganising the 88 subsidiaries in its stable into four clusters to make it leaner and more efficient. FGV president and chief executive officer  Datuk Sabri Ahmad said the restructuring was part of the group’s 40-point initiatives to be implemented 100 days after its listing two months ago. The clusters are plantations, downstream, sugar and Felda Holdings Bhd. The latter is FGV’s associate company. “The clusters, however, will not be listed on their own in the future,” Sabri said, adding that only FGV and MSM would remain as the listed entity. (BT)

Bloomberg survey shows that  palm oil stockpiles in Malaysia probably climbed the most in 10 months in July to 1.87m tonnes from 1.7m tonnes in June as output increased and exports fell, easing supply concerns as a drought cuts US soybean yields. The Malaysian Palm Oil Board is set to release the official data this Friday. (Malaysian Reserve)

The condition of U.S. soybean crops deteriorated as the worst drought in 56 years caused damage across the Midwest.  US Department of Agriculture   reported about 39% of soybeans were rated poor to very poor as of yesterday, more than the 37% of a week earlier. “There were some areas that got rain, but it was later in the weekend, so I don’t think it was picked up on this report,” said an industry source. (Bloomberg)

From 2006 to 30 Jun 2012,  Iskandar Malaysia had received RM95.5bn cumulative  committed investments in various sectors with RM41.35bn or 43% already realised. Of the total, RM58.95bn or 62% were from domestic investors. Since 2006, the manufacturing sector took the top spot with RM32.71bn, with the property sector came in second at RM29.80bn. Investment in other sectors include utilities (RM9.52bn), government (RM7.31bn), petrochemicals (RM5.10bn), ports and logistics (RM3.74bn), tourism (RM2.03bn), education (RM1.55bn), healthcare (RM1.60bn), creative (RM0.40bn) and others (RM1.69bn). Last year, Iskandar Malaysia managed to record RM15.3bn investments of its projected RM15bn target. This year, it is looking at a RM20bn target. In the first six months of 2012, Iskandar Malaysia had secured RM10.67bn new investments. Therefore, it would not be impossible to achieve this year's target, Iskandar Regional Development Authority (Irda) CEO Datuk Ismail Ibrahim said. (Starbiz)

The aggressive expansion of  Singapore Airlines’ (SIA) short-haul premium unit  SilkAir  is expected to heighten competition for  Malaysian Airline(MAS). SilkAir’s recent orders for 68 new aircraft, to be delivered between 2014 and 2021, will eventually boost its current fleet of 21 planes to 89. There is a possibility of SilkAir dominating SIA’s route network of less than four hours flight radius in Asia. (Financial Daily)

After gaining approval from shareholders to proceed with the merger exercise, K&N Kenanga Holdings expects a 30-40% in cost synergies post-merging with ECM Libra. The integration cost for the two entities was about RM260m. The company had engaged with Boston Consulting Group in the integration. (Star Biz)

KYM Holdings Bhd may axe its plan to venture into iron ore mining in Aceh, Sumatra, after the government there imposed an export ban on the product, a key official said. KYM COO Allan Chin Kong Yaw said the plan would also now require a bigger investment than estimated after the government wanted the venture to process the raw materials in Aceh instead. “The government says we can’t export the iron ore. It wants us to process the raw materials there and that will require huge investments from us,” he said. Chin told BT recently that KYM would seek legal advice on the matter. “We hope to find a solution. There is a huge potential in Aceh. But if we think the venture is not viable because of the huge investments needed, we will not proceed,” Chin said.(BT)

Willoglen MSC’s unit Willoglen Services Pte Ltd has won a contract worth RM9.7m to upgrade an integrated security and operation surveillance system infrastructure for substations and security command centre. (BT)

Uzma Bhd's  subsidiary has secured a RM62m contract from Talisman Malaysia Ltd to supply of chemical and related services over five years.Its subsidiary Malaysian Energy Chemical & Services Sdn. Bhd had  received the letter of award for the contract, which was retroactive from July 6 this year and until July 5, 2017. The contract has four extension options of one year each. (Starbiz)

TH Heavy Engineering Bhd's issuance of 265.m rights shares under its regularisation plan, recorded a subscription rate of 99.5%. As of July 27, the total valid acceptance was 263.7m shares. "In view that the rights shares have been undersubscribed, all applications for the excess rights shares are successful," it said. TH Heavy Engineering said that 89.7m unsubscribed rights shares would be allotted to applicants who applied for 88.4m excess rights shares. (Starbiz)

20120807 1520 Global Market Related News.

Asia FX By Cornelius Luca - Mon 06 Aug 2012 16:19:15 CT (Source:CME/www.lucafxta.com)
The appetite for risk was limited on Monday following relief buying on Friday triggered by a stronger-than-expected NFP report. The foreign currencies made little progress after the European and commodity currencies soared on Friday. The US stock indexes accumulated small gains. The short-term outlook for the foreign currencies is sideways. The medium-term outlook for most of the foreign currencies is sideways. The LGR short-term model is short only the yen.  Good luck!

Asian Stocks Gain on Europe Central Bank Bond-Buying Plan (Source:Bloomberg)
Asian stocks rose, with the regional benchmark index headed for its highest close in three months, after Germany backed the European Central Bank’s bond-buying plan, boosting the outlook for Asia-Pacific exporters. Esprit Holdings Ltd. (330), a clothier that counts Europe as its largest market, gained 25 percent in Hong Kong after it named a new chief executive officer. BHP Billiton Ltd., the world’s biggest miner, rose 0.5 percent in Sydney after metal prices increased. Toshiba Corp., which makes semi-conductors and parts for nuclear reactors, advanced 3.5 percent in Tokyo as it was raised to outperform at CLSA Asia Pacific Markets. Japanese utilities gained as they rebounded from last month’s plunge. The MSCI Asia Pacific Index (MXAP) rose 0.6 percent to 119.78 as of 3:30 p.m. in Tokyo, with about five stocks rising for every two that that fell in the measure, which is headed for its highest close since May 9.
“Investors are hoping that Spain won’t request a full bailout,” said Stan Shamu, a market strategist at IG Markets Ltd. in Melbourne, a provider of trading services in stocks, bonds and commodities. “That would clear the way for the ECB to buy bonds in the secondary market. That’s still the main issue.” Japan’s Nikkei 225 Stock Average (NKY) rose 0.9 percent, while South Korea’s Kospi Index added 0.1 percent. Australia’s S&P/ASX 200 Index advanced 0.5 percent as the nation’s central bank kept interest rates unchanged today. New Zealand’s NZX 50 Index gained 0.6 percent.

Japan’s Nikkei 225 Reaches Month High on ECB Bond Plan (Source:Bloomberg)
Japanese stocks gained for a second day, with the Nikkei 225 Stock Average (NKY) closing at a four-week high, amid optimism Germany will support the European Central Bank’s bond-buying plan to ease the region’s debt crisis. Brother Industries Ltd. (6448), a maker of office equipment that relies on Europe for almost 30 percent of its sales, jumped 4.3 percent. Nippon Paint Co. soared 4.9 percent after boosting its earnings forecast. Sharp Corp. rebounded from a 37-year low yesterday on speculation Foxconn Technology Group would follow through with its investment in the electronics maker. Kansai Electric Power Co., which has plunged 29 percent in the past 30 days, gained 10 percent. The Nikkei 225 Stock Average rose 0.9 percent to 8,803.31 at 3 p.m. in Tokyo, the highest close since July 11, with volume 7.6 percent below the 30-day average ahead of the Bank of Japan’s meeting tomorrow. The broader Topix Index gained 1.1 percent to 743.70. More than two shares rose for each that fell.
“There are expectations that the ECB’s bond-purchasing plan will ease debt crisis tensions, bolstering markets,” said Kiyoshi Ishigane, a Tokyo-based strategist at Mitsubishi UFJ Asset Management Co., which oversees about $70 billion. “Earnings are just so-so on the whole. Some technology companies have been hurt by the stronger yen but I don’t have an impression that their earnings are very bad.”

China’s Stocks Swing Between Gains, Losses on Profit Concern (Source:Bloomberg)
China’s stocks swung between gains and losses as concern the slowing economy will hurt profit growth overshadowed support by German Chancellor Angela Merkel’s government for the European Central Bank’s bond-buying plan. China Life Insurance Co. slid to a one-week low after estimating first-half net income fell by a “relatively large degree.” Southwest Securities Co. declined 2.6 percent after ending a plan to acquire a rival brokerage because of falling stock prices and lower earnings. Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co. led gains among rare earth stocks after China National Radio reported the country plans to shut down about a fifth of existing industry production capacity.
The Shanghai Composite Index slid less than 0.1 percent to 2,154.39 at 1:02 p.m. local time. The CSI 300 Index (SHSZ300) was little changed at 2,385.31. The Hang Seng China Enterprises Index of Chinese companies traded in Hong Kong advanced 0.4 percent. The Bloomberg China-US 55 Index (CH55BN), the measure of the most-traded U.S.-listed Chinese companies, added 3.1 percent. “There are still expectations company earnings will fall,” said Wu Kan, a Shanghai-based fund manager at Dazhong Insurance Co., which oversees $285 million. “However, sentiment towards Europe has improved. Previously, investors expected the worst for Europe. With a little progress now, people are getting a tad more optimistic.”

U.S. Stocks Rise on Europe as Earnings Beat Estimates (Source:Bloomberg)
U.S. stocks rose, sending the Standard & Poor’s 500 Index to a three-month high, as German Chancellor Angela Merkel’s government backed the European Central Bank’s bond-buying plan and earnings beat forecasts. Bank of America Corp. (BAC), Caterpillar Inc. (CAT) and Alcoa Inc. (AA) jumped at least 1.8 percent to pace advances among the largest U.S. companies. Best Buy Co. (BBY) surged 12 percent as founder Richard Schulze offered to take the electronics retailer private. Regions Financial Corp. (RF) added 1.9 percent after Bank of America Corp. raised its recommendation on the shares. Knight Capital Group Inc. (KCG), the firm driven to the brink of bankruptcy by trading losses last week, tumbled 21 percent.
About five stocks advanced for every two falling on U.S. exchanges at 12:41 p.m. New York time. The S&P 500 (SPX) rose 0.5 percent to 1,398.38. The Dow Jones Industrial Average added 76.48 points, or 0.6 percent, to 13,172.65. Trading in S&P 500 companies was down 15 percent from the 30-day average at this time of day. “There’s better general feeling,” Richard Sichel, who oversees $1.6 billion as chief investment officer at Philadelphia Trust Co., said in a phone interview. “We’ve had a good earnings season and better than estimated data last week. The weekend didn’t bring any painful news out of Europe and there are expectations the ECB will buy bonds.”

European Stock Futures Little Changed; Asian Stocks Rise (Source:Bloomberg)
European (SXXP) stock-index futures were little changed before reports on factory orders in Germany and Italian economic growth. U.S. index futures were also little changed, while Asian stocks advanced. Standard Chartered (STAN) Plc may drop in London, following losses in Asia, after a U.S. regulator said the lender faces suspension of business activities because of transactions with Iranian banks. Deutsche Telekom AG (DTE) may be active after people familiar with the matter said it may bid for PrimaCom Berlin GmbH. Xstrata Plc (XTA), target of a $27 billion takeover bid by Glencore International Plc, may be active after reporting first-half profit that beat analyst estimates. Futures on the Euro Stoxx 50 Index, a benchmark for the euro region, fell 0.2 percent to 2,393 at 7:05 a.m. in London. Futures on the U.K.’s FTSE 100 Index (UKX) also lost 0.2 percent to 5,760. Futures on the Standard & Poor’s 500 Index dropped less than 0.1 percent, while the MSCI Asia Pacific Index increased 0.6 percent.
The Stoxx 600 Index climbed yesterday, extending a four- month high, as Greece and its creditors agreed on the need to strengthen policy efforts to meet bailout conditions and support economic growth. The benchmark measure has climbed 13 percent over the past nine weeks as policy makers eased repayment terms for Spanish banks and optimism grew that central banks will announce stimulus measures.

Most Emerging Stocks Rise After Germany Backs ECB Plan (Source:Bloomberg)
Most emerging-market stocks advanced as Germany’s support for the European Central Bank’s bond-buying plan overshadowed concerns slowing economies will hurt company earnings. China Rongsheng Heavy Industries Group Holdings Ltd. (1101), the country’s biggest shipbuilder outside state control, surged 12 percent in Hong Kong on speculation orders will increase as concerns ease about Europe’s debt crisis, according to UOB-Kay Hian Holdings Ltd. China ZhengTong Auto Services Holdings Ltd. (1728) rose the most in almost two months after Value Partners Group Ltd. raised its stake in the auto retailer. HTC Corp. (2498) tumbled 7 percent in Taipei, extending yesterday’s 6.9 percent slump, after forecasting revenue that missed analysts’ estimates.
The MSCI Emerging Markets Index rose less than 0.1 percent to 967.54 at 1:07 p.m. in Hong Kong with 297 stocks gaining and 188 falling. German Chancellor Angela Merkel backed a bond- buying plan announced last week by the ECB, a spokesman said yesterday, fanning speculation the monetary authority will act to cut borrowing costs for Spain and Italy. The 21 nations in the MSCI emerging market gauge send about 30 percent of their exports to the European Union on average, data compiled by the World Trade Organization show. “Germany’s support is very crucial as it’s the biggest economy in Europe,” said Akbar Syarief, a fund manager overseeing about $359 million at PT MNC Asset Management in Jakarta. Meanwhile, “a lot of companies have earnings that don’t meet expectations. Overseas demand is low.”

Treasuries Snap Loss After Bernanke Notes ‘Struggle’ (Source:Bloomberg)
Treasuries snapped a two-day decline after Federal Reserve Chairman Ben S. Bernanke said people are struggling economically, fueling speculation he is open to increasing bond purchases to spur growth. Treasuries returned 6.8 percent in the 12 months to yesterday, based on Bank of America Merrill Lynch data, reflecting demand for U.S. debt as a haven from slowing economic growth and Europe’s debt crisis. The rally was interrupted this month after a U.S. report Aug. 3 showed the nation added more jobs than economists projected. The government is scheduled to sell $32 billion of three-year notes today, $24 billion of 10- year debt tomorrow and $16 billion of 30-year bonds on Aug. 9. “If Bernanke thinks they should do something to support the economy, it will put downward pressure on yields,” said Kei Katayama, who buys U.S. government debt in Tokyo for Daiwa SB Investments Ltd., which manages the equivalent of $63.6 billion. “That makes it very difficult to sell.”
Benchmark 10-year yields were little changed at 1.57 percent as of 6:50 a.m. in London, according to Bloomberg Bond Trader prices. The record low was 1.38 percent July 25. The price of the 1.75 percent security due in May 2022 was 101 21/32 today.

Treasury Bears Submit to Fed as Bond Optimism at High (Source:Bloomberg)
Jay Mueller, who manages $3 billion of bonds for Wells Capital Management in Milwaukee, resisted buying Treasuries for four months, anticipating the Federal Reserve would drop its pledge to keep interest rates at a record low through late 2014. No more. With the economy growing at a 1.5 percent annual pace, the odds of a recession have risen to 60 percent, making 1 percent yields on 10-year notes a possibility, he said. Wells Capital’s parent, Wells Fargo & Co., boosted its Treasury holdings 32 percent to $11.5 billion in May alone, according to the latest data compiled by Bloomberg. “We’re in a low-rate environment for a long time, longer than I had thought,” Mueller said in a July 26 interview at Bloomberg headquarters in New York. “I’m finally throwing in the towel.”
So are Pioneer Investment Management Inc., Pacific Investment Management Co., Federated Investors Inc., Northern Trust Global Investments and Columbia Management Investment Advisers LLC. They are adding to holdings of Treasuries as economic growth cools. Of the 20 firms that own the most Treasuries, 16 bought more U.S. government debt during their most-recent reporting periods, Bloomberg data show.

FOREX-Euro dips on caution over debt crisis response
LONDON, Aug 6 (Reuters) - The euro fell  as investors remained cautious about how effective European policymakers latest pledges of action to resolve the euro zone debt crisis would be.
"There hasn't been anything that has improved the situation in Europe ... we haven't had any concrete improvement in the situation in the euro zone," said Niels Christensen, currency strategist at Nordea in Copenhagen.

FOREX-Euro touches 1-month high on stop-loss buying
The euro hit a one-month high against the dollar as traders unwound bearish bets on the single currency after stronger-than-expected U.S. jobs data last week improved investors' appetite for risk.
"When you think about the fact that something positive will probably materialise even if it takes some time, the euro could  see a bit of a rebound," said Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo, referring to possible ECB measures.

Yen Stays Stronger Before BOJ Meeting; Aussie Near 4-Mont (Source:Bloomberg)
The yen remained stronger versus the dollar as a rally in equities worldwide spurred speculation the Bank of Japan (8301) will refrain from additional monetary easing at a policy meeting that starts tomorrow. Demand for the euro was supported after German Chancellor Angela Merkel’s government backed the European Central Bank’s bond-buying plan as Italian Prime Minister Mario Monti called for more urgency in efforts to lower borrowing costs. The Australian dollar rose to the highest in more than four months after the nation’s Reserve Bank kept interest rates unchanged at 3.5 percent at a policy meeting today. “The Bank of Japan looks set to keep policy unchanged,” said Mike Jones, a currency strategist at Bank of New Zealand in Wellington. “Without any impediment from the Bank of Japan, we’ll see more of the same, that gradual grind lower in the next few sessions and coming months for dollar-yen.”
The yen was little changed at 78.28 per dollar at 6:45 a.m. in London from yesterday, when it rose 0.3 percent. The Japanese currency was at 96.99 per euro from 97.03. The 17-nation euro bought $1.2390 from $1.2401 yesterday, when it touched $1.2444, the most since July 5. Australia’s dollar reached $1.0603, the highest since March 20, before trading at $1.0581, 0.1 percent above yesterday’s close.

Aussie Dollar Touches 4-Month High as RBA Holds Rates (Source:Bloomberg)
Australia’s dollar touched its highest level in more than four months after the Reserve Bank kept interest rates unchanged and said current policy settings are “appropriate.” The so-called Aussie rose against most major peers after RBA Governor Glenn Stevens and his board said in a statement from Sydney the nation’s growth is close to trend. New Zealand’s currency maintained a three-day gain as Asian stocks extended a global rally, supporting demand for riskier assets. “I think the RBA hasn’t really set out a case for lowering interest rates, so I suspect that’s probably maybe a surprise to the markets,” said Annette Beacher, head of Asia-Pacific research at TD Securities in Singapore. The overall statement “seemed to be quite bullish for the Aussie dollar.” Australia’s dollar touched $1.0603, the strongest level since March 20, before trading little changed at $1.0570 as of 4:09 p.m. in Sydney. It traded at 82.73 yen from 82.70 yesterday.
New Zealand’s dollar, nicknamed the kiwi, was also little changed at 81.97 U.S. cents, after rising 1.5 percent over the previous three trading sessions. It bought 64.17 yen from 64.16. The MSCI Asia Pacific Index of shares rose 0.6 percent, after climbing 1.8 percent yesterday.

Bank Loans at Post-Recession Peak Support U.S. Growth (Source:Bloomberg)
Banks in the U.S. are lending the most since the recession ended in June 2009, supporting an economy weighed down by 8.3 percent unemployment. Borrowing by consumers and businesses rose in the week ended July 25 to $7.1 trillion, within 2.9 percent of its October 2008 peak, according to Federal Reserve data. New lending for autos jumped to $134.3 billion in the first four months of the year, up 56 percent from the same period in 2009, according to credit bureau Equifax Inc. (EFX) The increase in lending may prevent the economy from slowing further after growth cooled to a 1.5 percent annual pace of growth in the second quarter. While the Fed last week moved closer to expanding its record stimulus, the figures on credit indicate that 43 months of near-zero interest rates may finally be giving the economy the jolt it needs, said Jim Paulsen, who helps oversee $320 billion as chief investment strategist at Wells Capital Management in Minneapolis.
“Many pieces of the credit-creation process are starting to work again,” Paulsen said. “Banks are lending, people are borrowing, housing prices are going up and a sense of normality is returning.”

Bernanke Says Economic Data May Mask Individual Suffering (Source:Bloomberg)
Federal Reserve Chairman Ben S. Bernanke said gauges of the U.S. economy’s strength may fail to measure the suffering of individual citizens. “Even though some key aggregate metrics -- including consumer spending, disposable income, household net worth, and debt service payments -- have moved in the direction of recovery, it is clear that many individuals and households continue to struggle with difficult economic and financial conditions,” Bernanke said today in remarks prepared for a conference in Cambridge, Massachusetts. The Federal Open Market Committee said on Aug. 1 it will pump fresh stimulus if necessary into the weakening economic expansion to boost growth and reduce an unemployment rate that’s been stuck at 8 percent or higher for more than three years. Bernanke didn’t address the outlook for monetary policy or the economy, or expand on the Fed’s Aug. 1 statement. His remarks, focused on economic measurement, will be delivered via prerecorded video.
The 58-year-old Fed chief, a former Princeton professor, said economists should “increase the attention paid to microeconomic data, which better capture the diversity of experience across households and firms.” Also, researchers should “seek better and more-direct measurements of economic well-being, the ultimate objective of our policy decisions.”

Fed Says Banks Ease Standards on Business, Consumer Loans (Source:Bloomberg)
U.S. banks are relaxing their terms on credit cards and lending for autos and commercial real estate, according to a Federal Reserve survey. “Domestic banks, on balance, continued to report having eased their lending standards across most loan types over the past three months,” the Fed said today in Washington in its quarterly survey of senior loan officers. While lending standards are tightening at branches of foreign banks, “domestic banks reported that their business had increased due to decreased competition from European banks and that they remain willing to accommodate additional such business,” the Fed said. Banks in the U.S. are lending the most since the recession ended in June 2009, supporting an economy burdened by 8.3 percent unemployment. Fed policy makers including Chairman Ben S. Bernanke weighed the results of the survey at their July 31- Aug. 1 meeting at which they said they “will provide additional accommodation as needed” to support the economy.

Monti Calls for More Crisis Urgency in ECB Crisis Standoff (Source:Bloomberg)
Italy’s Prime Minister Mario Monti warned of a potential breakup of Europe without greater urgency in efforts to lower government borrowing costs, as a standoff over European Central Bank help for Italy and Spain hardened. Monti, in an interview with Germany’s Der Spiegel magazine published yesterday, said that disagreements within the 17- nation euro area are detracting from the policy response to the debt crisis and undermining the future of the European Union. “The tensions that have accompanied the euro zone in the past years are already showing signs of a psychological dissolution of Europe,” Monti told Der Spiegel. While he backed the ECB’s willingness to address “severe malfunctioning” in the government bond market, Monti said the problems “have to be solved quickly now so that there’s no further uncertainty about the euro zone’s ability to overcome the crisis.”
Spain and Italy, whose surging borrowing costs have shunted them to the heart of the turmoil in the euro area, are resisting pressure from ECB President Mario Draghi to formally request aid in return for strict conditions before the central bank will buy their bonds. Monti and Spanish Prime Minister Mariano Rajoy have both said they will await further details as the ECB works up its plan. The German government said for the first time today that Chancellor Angela Merkel supports Draghi’s proposals. French President Francois Hollande is pushing Monti and Rajoy to request aid from Europe’s bailout fund to help ease markets and protect France from speculation, Italian newspaper la Corriere della Sera reported, without citing anyone. Monti may speak with Draghi today, the newspaper said.

Rice Hoard Offers World Respite as Food Costs Surge: Commodities (Source:Bloomberg)
At a time when droughts are driving corn and soybeans to all-time highs, farmers are set to reap a record rice crop and Thailand is building the biggest stockpile in at least five decades, helping avoid a global food crisis. The largest exporting nation bought 11 million metric tons as of July, enough to supply the six biggest importers, Commerce Ministry data show. As corn farmers from the U.S. to Ukraine endure drought, paddy fields will yield 1.1 million tons more milled grain, the U.S. Department of Agriculture predicts. Benchmark 5-percent Thai white rice will drop 14 percent to $480 a ton by Dec. 31, according to the median of 10 estimates from traders and analysts surveyed by Bloomberg.
Shipments of the staple for half the world will expand 2.6 percent to a record in 2012-2013, the USDA predicts. Those exports combined with Thailand’s stockpiles, which may be cut to clear space for the next harvest, are a buffer against grain reserves seen at the lowest in at least five years. Cheaper rice may contain global food costs the United Nations predicts will rebound, ending a retreat to a 21-month low in June. “Rice is the only bright spot which is keeping us away from a global food crisis,” said Abdolreza Abbassian, a senior economist at the UN’s Food & Agriculture Organization in Rome. “The corn situation is very worrisome, while with wheat, the overall supply situation is still adequate.”

Monti Calls for More Crisis Urgency in ECB Standoff (Source:Bloomberg)
Italy’s Prime Minister Mario Monti warned of a potential breakup of Europe without greater urgency in efforts to lower government borrowing costs, as a standoff over European Central Bank help for Italy and Spain hardened. Monti, in an interview with Germany’s Der Spiegel magazine published yesterday, said that disagreements within the 17- nation euro area are detracting from the policy response to the debt crisis and undermining the future of the European Union. “The tensions that have accompanied the euro zone in the past years are already showing signs of a psychological dissolution of Europe,” Monti told Der Spiegel. While he backed the ECB’s willingness to address “severe malfunctioning” in the government bond market, Monti said the problems “have to be solved quickly now so that there’s no further uncertainty about the euro zone’s ability to overcome the crisis.”
Spain and Italy, whose surging borrowing costs have shunted them to the heart of the turmoil in the euro area, are resisting pressure from ECB President Mario Draghi to formally request aid in return for strict conditions before the central bank will buy their bonds. Monti and Spanish Prime Minister Mariano Rajoy have both said they will await further details as the ECB works up its plan. The German government said for the first time today that Chancellor Angela Merkel supports Draghi’s proposals.

Draghi Echoing Merkel Has Trader Raise Bets Against Euro (Source:Bloomberg)
When European Central Bank President Mario Draghi vowed July 26 to do “whatever it takes” to defend the euro, he succeeded in stemming a slide that pushed the 17- nation currency down about 6 percent since late March against its major counterparts. Traders in the options market responded by raising bets against the currency of the developed world’s worst-performing economy by the most in 11 weeks. Options to protect against further weakness climbed in the past two weeks by the biggest amount since May. Between Jan. 12, 2011, when German Chancellor Angela Merkel vowed to do “whatever is needed to support the euro” and Draghi’s almost-identical pledge, Portugal, Spain and Cyprus sought bailouts and the region’s $13 trillion economy teetered on recession. Growth will trail its Group-of-10 peers through at least 2014, according to Bloomberg surveys, as companies from Siemens AG, Europe’s largest engineering company, to sporting- goods maker Puma SE cut their outlooks.
“Whatever the ECB does, it can’t conjure growth out of nowhere,” Frances Hudson, a global strategist at Standard Life Investments in Edinburgh, said in a telephone interview on Aug. 2. “The euro could go down further. The markets are not really willing to give them the benefit of the doubt anymore.”

20120807 1520 Global Commodities Related News.

DTN Closing Grain Comments 08/06 14:49 : Weekend Rains Pressure Soybeans(Source:CME)
Higher rain totals than expected over the weekend took soybeans sharply lower Monday, though the debate rages on how much it will help given the crop is 2 to 3 weeks ahead of schedule. Corn and wheat put up a good fight despite the weakness in beans, with the latter able to close higher.

Wheat Market Recap Report (Source:CME)
September Wheat finished up 2 at 893 1/4, 4 off the high and 16 1/2 up from the low. December Wheat closed up 2 1/2 at 906 1/4. This was 16 3/4 up from the low and 3 1/2 off the high. September Chicago wheat traded higher into the close after falling overnight on follow through from a lower corn market. KC and Minneapolis wheat traded lower on the day. The wheat market found support this morning after a private Russian consultant lowered their Russian wheat production forecast to 40.5-43 million tonnes. This was down from previous estimates of 46.5 million tonnes. Furthermore, the Russian Agriculture Ministry reportedly expects their best estimate for wheat production to be 45 million tonnes. The last USDA estimate was 49 million. Above normal heat and below normal precipitation continues to stress spring wheat areas in Russia, which is adding to the supportive trade. The United Nations' Food and Agriculture Organization said on Monday it had cut its 2012 global forecast for rice paddy production by 7.8 million tonnes to 724.5 million tonnes, due mainly to below average monsoon rains in India. This could have a positive impact on domestic usage of wheat in the coming year as major importers come to market for the cheapest available grain. Wheat export inspections for the week ending August 2nd were pegged at 20.90 million bushels vs. 18.60 million bushels last week. Current inspections stand at 14% of the current USDA estimates vs. the 5 year average of 16%. Weekly inspections continue to fall short of the 23.8 million bushels needed each week to meet the USDA estimate. September Oats closed down 4 1/2 at 373 1/2. This was 4 1/2 up from the low and 4 1/4 off the high.

Pro Farmer: After the Bell Wheat Recap(Source:CME)
Wheat futures saw two-sided trade today but a late surge of buying interest helped futures to finish high-range. Chicago wheat ended roughly 2 to 10 cents higher; Kansas City closed mixed and Minneapolis favored the downside in a choppy finish. Wheat futures saw choppy trade today, with bears having a slight advantage most of the day and into the close thanks to spillover pressure from corn and soybeans.

Corn Market Recap for 8/6/2012 (Source:CME)
September Corn finished down 7 at 803, 4 3/4 off the high and 10 up from the low. December Corn closed down 2 1/2 at 805. This was 15 3/4 up from the low and 4 3/4 off the high. December corn traded slightly lower into the close. Pressure was linked to a sharply lower soybean market after beneficial rainfall spread over 50% of the Midwest this weekend. The corn market continues to consolidate above $8.00 ahead of the USDA report on Friday where traders expect reductions to the US corn yield. Crop condition ratings for US corn are expected to decline 1-2% as temperatures have remained above normal for areas west of the Mississippi River and yields continue to fall. The US Dollar turned lower midday, offering support to the corn market. Corn export inspections for the week ending August 2nd were pegged at 19.88 million bushels vs. 21.43 million bushels last week for the 2011/12 marketing year. Current inspections stand at 89.3% of the current USDA estimates vs. the 5 year average of 89.8%. Weekly inspections continue to fall short of the 39.88 million bushels needed each week to meet the USDA estimate. September Rice finished down 0.025 at 15.95, 0.09 off the high and 0.05 up from the low.

Pro Farmer: After the Bell Corn Recap(Source:CME)
Corn futures opened lower, but trimmed losses to finish mixed. The September through May contracts ended 1 1/4 to 7 cents lower, with the rest of the market up 1/2 to 3 cents amid bull spread unwinding. Early weakness was tied to spillover from sharp losses in the soybean market, but traders trimmed losses as they realize weekend rains will do no more than stabilize the corn crop. Pressure on nearby futures was also limited by positive outside markets.

GRAINS-Soybeans drop on rain forecast; USDA report eyed
SYDNEY, Aug 6 (Reuters) - Chicago soybeans fell more than 2 percent, unwinding last week's gains, on forecasts for light rain in some regions of the drought-battered U.S. Midwest over the coming days.
"There's cooler weather and a little bit of light rain forecast, which I think is keeping the market a bit depressed," Andrew Woodhouse, a Sydney-based analyst at Advance Trading Australasia said.

FAO cuts global rice output forecast for 2012
ROME, Aug 6 (Reuters) - The United Nations' Food and Agriculture Organisation said on Monday it had cut its 2012 global forecast for rice paddy production by 7.8 million tonnes to 724.5 million tonnes, due mainly to below average monsoon rains in India.
A 22 percent lower than average monsoon rainfall in India through mid-July is likely to reduce output in the country this season, FAO said. Production forecasts have also been cut for countries including Cambodia and Nepal.

Grain yields halved in part of Russia's Volga Valley
BOLSHIE KLYUCHISHCHI, Russia, Aug 6 (Reuters) - Farmers in this drought stricken Russian province are used to shipping grain down the Volga River as far afield as Iran but this year yields have halved, sending up local prices and prompting farms to hold onto grain in hope of further gains.
The Ulyanovsk region harvested 1.3 million tonnes of grains in 2011, exporting a million tonnes of that.

Saudi Arabia buys hard wheat from U.S., Australia, EU
JEDDAH, Saudi Arabia, Aug 5 (Reuters) - Saudi Arabia's grains authority bought 290,000 tonnes of hard wheat from North and South America, the European Union and Australia for shipment in October and November, the Saudi Grain Silos and Flour Mills Organisation said in an emailed statement on Sunday.
"Saudi Arabia has bought 290,000 tonnes of hard wheat (12.5 percent protein) from the EU, Australia, North and South America (Seller options) for October and November shipments," it said.

Informa cuts forecasts for US 2012 corn, soy production
CHICAGO, Aug 3 (Reuters) - Private analytics firm Informa Economics expects the U.S. government to lower its U.S. 2012 corn yield estimate to 120.7 bushels per acre (bpa) next week, but the firm also said in a note to clients on Friday that it expected a "most likely final" corn yield of 131.0 bpa.
Similarly, Informa said it expected the U.S. Department of Agriculture next week to cut its U.S. 2012 corn production forecast to 10.338 billion bushels, but the firm pegged final U.S. corn production at 11.224 billion bushels.

Hail hammers Saskatchewan, Alberta crops
WINNIPEG, Manitoba, Aug 3 (Reuters) - Hail pounded crops in Saskatchewan and Alberta during the past two weeks, likely causing significant damage in Canada's two biggest wheat- and canola-growing provinces, a report said.
Saskatchewan has had hail nearly every night in the past two weeks, with insurance claims totaling more than 7,600, ahead of the five-year average and last year's pace, the Canadian Crop Hail Association said.

Texas feedlots buy HRW wheat from Canada
Aug 3 (Reuters) - Texas cattle feedlots purchased 45,000 tonnes of hard red winter wheat from Canada in recent days due to tight supplies of feed corn and its record-high prices, United States and Canadian trade sources said on Friday.
In the past two weeks, Canadian exporters sold as many as 500 rail cars of wheat for shipment into the No. 1 U.S. cattle state of Texas, the sources said.

SOFTS-Sugar dips, cocoa falls, eyes on weather
LONDON, Aug 6 (Reuters) - Raw sugar futures on ICE eased, weighed by harvest pressure in Brazil, while cocoa fell in a technically driven correction, pressured by a firmer dollar. Arabica coffee futures edged higher, with upside potential capped by harvesting in Brazil. A key focus of the softs markets was weather in Brazil, the world's top sugar and coffee producer, and in West Africa, the main cocoa growing region. Dry weather in West Africa could erode output prospects, dealers said.
Speculators switch to net short cotton position-CFTC
Aug 3 (Reuters) - Speculators turned net short in cotton contracts on ICE Futures U.S. for the first time since mid-June, in the week to July 31, when the futures market hit a one-month low, U.S. Commodity Futures Trading Commission data showed on Friday.
The noncommercial dealers cut 3,948 cotton futures and options, causing it to switch to a net short position of a slight 255 contracts, the data showed.

Cotton Crop in India to Tumble as Dry Weather Hurts Crops (Source:Bloomberg)
The cotton harvest in India, the world’s second-biggest grower, is poised to decline as the worst monsoon since 2009 parches fields and curbs planting, potentially cutting exports for the first time in three years. Futures surged to a six-month high in Mumbai. The crop in Gujarat, the largest producer, may plunge as much as 30 percent in the harvest starting Oct. 1 from 12 million bales of 170 kilograms each a year earlier, said Hasmukhbhai Raval, chairman of the Gujarat State Cooperative Cotton Federation. The planted area in the state will probably slump by as much as 25 percent from 3 million hectares (7.4 million acres) in 2011-2012, he said. Rainfall in some parts of Gujarat is as much as 81 percent below a 50-year average as more than 50 percent of India is threatened by drought, shriveling crops from rice to cotton and oilseeds. A smaller harvest would reduce exports, helping halt a decline in New York prices, which slumped 23 percent in the past year as demand slowed in China, the biggest consumer.
“The outlook for the 2013 crop suggests global supply might be squeezed due to competition for acreage from crops like soybeans, and the weak monsoon in India,” Abah Ofon, an analyst at Standard Chartered Plc, said by e-mail. “Output is being disincentivised at current price levels and we believe global supply will be lower next year.” Global cotton production in the year that started Aug. 1 will drop to 24.878 million metric tons from a record 26.66 million tons in the year ended July 31, Birkenhead, U.K.-based industry researcher Cotlook Inc. said July 19.

Euro Coal-Prices expected to be pushed up by Colombian strike
LONDON, Aug 3 (Reuters) - European physical prompt coal saw extremely thin trading on Friday since most market players are on holiday, but analysts said that prices would likely come under upward pressure as a strike in Colombia reduced supplies to Europe.
Two of Colombia's top coal exporters -- Drummond International and Glencore's Prodeco  unit -- have already cancelled some cargoes due to an 11-day strike that may give support to global prices despite an oversupplied market.

Oil Drops From Two-Week High as Investors Seek Profit After Gain (Source:Bloomberg)
Oil slid from the highest close in two weeks in New York as investors sought to profit from crude’s 5.8 percent advance in two days. Futures slipped as much as 0.5 percent after climbing 0.9 percent yesterday. Prices are declining in New York as they approach technical resistance at $92.75 a barrel, according to data compiled by Bloomberg. U.S. crude stockpiles probably fell by 1.6 million barrels last week, according to a Bloomberg News survey of nine analysts before an Energy Department report tomorrow. Tropical storm Ernesto was forecast to become a hurricane as it heads for Mexico’s Bay of Campeche. “If you come up to the topside then naturally you’re going to see people take profit,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin, a commodity-markets newsletter in Sydney, who predicts West Texas Intermediate oil faces technical resistance at $92.50 a barrel.
Oil for September delivery slid as much as 42 cents to $91.78 a barrel in electronic trading on the New York Mercantile Exchange and was at $91.91 at 2:28 p.m. Singapore time. It settled yesterday at $92.20, the highest level since July 19. Prices are 7 percent lower this year. Brent crude for September settlement was at $109.35 a barrel, down 20 cents, on the London-based ICE Futures Europe exchange. The European benchmark’s premium to West Texas Intermediate was at $17.45 from $17.35 yesterday.

Saudi oil price cut shows softer Asian demand
--Clyde Russell is a Reuters market analyst. The views expressed are his own--
LAUNCESTON, Australia, Aug 6 (Reuters) - Saudi Arabia's decision to cut oil prices for September loading to major customers in Asia by more than expected is probably the best sign that physical crude demand is softening.
The official selling price (OSP) of the main grade Arab Light was cut to a premium of $1.25 a barrel over the Oman-Dubai average for September, down from $2.05 for August cargoes.

OIL-Oil softens after surge; data eyed
LONDON, Aug 6 (Reuters) - Oil retreated from last week's gains, easing towards $108 a barrel  as investors took profits and awaited more clues on the health of the global economy and the outlook for oil demand.
"Prices did rise quite a lot so it's probably profit-taking going on," said Michael Creed, an economist at the National Australia Bank.

Vietnam July crude oil output jumps to 1.38 mln T-min
HANOI, Aug 6 (Reuters) - Vietnam's July crude oil production rose 16 percent from a year ago to 1.38 million tonnes, or 326,000 barrels per day, the Industry and Trade Ministry estimated on Monday, slightly above an earlier government estimate of 1.31 million tonnes.
Crude oil production in the first seven months of 2012 increased 13.2 percent from the same period last year to 9.5 million tonnes, the ministry said, citing data by state oil and gas group Petrovietnam.

Many U.S. coal power plants headed for retirement(Source:CME)
Cheap, abundant natural gas, stricter air-quality rules hastening shift. About one-sixth of U.S. coal-fired power capacity is on track to be phased out by 2020 as older plants are shut down and more electricity is generated through cheaper natural gas, according to the Energy Information Administration. In a recent forecast, the EIA said an estimated 49 gigawatts of coal-burning capacity, or less than 5% of nationwide electrical capacity, will be retired over the next eight years. “Most of the generators projected to retire are older, inefficient units primarily concentrated in the Mid-Atlantic, Ohio River Valley, and Southeastern U.S. where excess electricity generation capacity currently exists,” the EIA said in the report. “Lower natural gas prices, higher coal prices, slower economic growth, and the implementation of environmental rules all play a role in the retirements,” according to the EIA, the Energy Department’s statistical arm.

Iron-Ore Rout Seen Curbing Commodity-Ship Losses: Freight (Source:Bloomberg)
The cheapest iron ore in 31 months and the lowest shipping costs on record are poised to increase the number of cargoes going to China, curbing losses for vessel owners enduring a seven-month run of unprofitable rates. Capesizes, each hauling about 160,000 metric tons of cargo, will earn an average of $14,000 a day in the fourth quarter, the most in a year, the median of six analyst estimates compiled by Bloomberg shows. While that’s more than the $10,500 anticipated by forward freight agreements, handled by brokers and used to bet on future transport costs, it’s still less than the $16,700 owners need to break even. The 34 percent slump in iron-ore prices in the past year means some Chinese mines will start curbing output, according to Morgan Stanley, the U.S. bank that ships the most commodities. Declining domestic supply will spur the nation’s mills, making about 46 percent of the world’s steel, to import more of the raw material, the biggest source of cargoes for Capesizes. (GNK)
“There will be a time when Chinese traders will come back to buy iron ore,” said Philippe Van Den Abeele, the London- based managing director of Castalia Fund Management (U.K.) Ltd., an adviser to a hedge fund trading freight derivatives. “The market is bad and there are too many ships, but we should have support in commodity demand and a pick-up in rates. We believe the fourth quarter will be busy.”

Iron Ore-More downside pressure for spot prices, support seen at $110
SINGAPORE, Aug 6 (Reuters) - Sellers of iron ore cargoes to top importer China cut prices further on Monday, pointing to more downside pressure for the commodity that slid nearly 13 percent last month as Chinese steel demand soured.
But iron ore, which hit a 2-1/2 year trough of $115.20 per tonne last week, is unlikely to fall below $110, traders say, as some Chinese mills could pick up cargoes to replenish run-down stocks.

Indonesia issues more mining export permits after June slump
JAKARTA, Aug 3 (Reuters) - Indonesia has awarded mineral export permits to 55 companies since it introduced curbs on such shipments this year, a trade ministry official said on Friday, after the limits triggered a slump in June exports to key customers Japan and China.
Indonesia, a major exporter of metal ores, in May imposed new rules on mining exports, including a 20 percent export tax. To obtain export permits under the new rules miners must now be certified "clear and clean" and provide plans to process ores they dig up, ahead of a 2014 ban on unprocessed ore exports.

COLUMN-Gold trapped between soft physical demand and economic fear
LAUNCESTON, Australia, Aug 3 (Reuters) - Gold remains trapped in no man's land between hopes it will rally if Western central banks are forced to further ease monetary conditions and the reality that physical demand in Asia remains tepid.

Managed money raises gold longs, trims copper shorts
Aug 3 (Reuters) - Hedge funds and money managers sharply raised their net long position in U.S. gold and silver futures and options in the week to July 31, as price gains based on speculation of more Federal Reserve stimulus prompted speculators to boost their bullish bets.
They raised their net longs in gold by 25,071, or 35 percent, to 96,200 lots in the period, data from the Commodity Futures Trading Commission (CFTC)'s Commitments of Traders showed. The net longs marked the highest since the week of June 19.

METALS-Copper treads water underpinned by U.S. jobs data
London copper was little changed after a better-than-expected U.S. jobs report eased concern over growth in the world's biggest economy, and a fresh pledge by top metals consumer China to support growth also helped to support prices.
"Friday's lift came in part from the very positive payroll number, but the market also seems to be reassessing its slightly negative take on ECB (European Central Bank) policy," said senior commodities strategist Nick Trevethan of ANZ in Singapore.

PRECIOUS-Gold ekes out gains as U.S. data weighs on dollar
Gold inched higher, extending gains from the previous session after better-than-expected U.S. employment data lent support to risk appetite, weighing on the dollar.
"Market participants are now betting on Fed action at next month's FOMC (Federal Open Market Committee) meeting as the unemployment rate ticked up, even though the payrolls figure beat expectations," said Chen Min, an analyst at Jinrui Futures in the southern Chinese city of Shenzhen.

Weak panamax rates drag down Baltic index
Aug 3 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry commodities, fell further on Friday as a rise in capesize rates was offset by weakness in the panamax segment.
The overall index, which reflects daily freight market prices for capesize, panamax, supramax and handysize dry bulk transport vessels, fell 1.05 percent to 852 points. The index has fallen about 9 percent this week.

20120807 1519 Soy Oil & Palm Oil Related News.

Soybean Complex Market Recap (Source:CME)
August Soybeans finished down 48 3/4 at 1607 1/2, 22 1/2 off the high and 3/4 up from the low. November Soybeans closed down 44 1/2 at 1584 1/4. This was 8 1/2 up from the low and 17 1/2 off the high. August Soymeal closed down 13.3 at 518.2. This was 1.2 up from the low and 11.2 off the high. August Soybean Oil finished down 0.56 at 51.48, 0.33 off the high and 0.36 up from the low. November soybeans traded sharply lower into the close on profit taking after beneficial rainfall moved across 50% of the US Midwest over the weekend. The rainfall should relieve stress for soybeans in the northern and eastern Midwest. Conditions should remain dry in the west and southwestern Corn Belt. Yield projections continue to be mixed with areas in the east offsetting some of the yield loss in the west. Crop condition ratings are expected to decline 1-2% for good/excellent conditions this afternoon. The USDA announced this morning that private exporters sold 106,000 tonnes of soybeans to China for the 2012/13 marketing year. The bullish news was set aside after a Brazilian analyst projected 2012/13 Brazil soybean production at 78.1 million tonnes, up 17.8% from the 2011/12. Soybean export inspections for the week ending August 2nd were pegged at 12.72 million bushels vs. 15.49 million bushels last week. Current inspections stand at 96.6% of the current USDA estimates vs. the 5 year average of 95.3%. Weekly inspections continue to exceed the pace needed to reach the USDA estimate. Inspections of only 10.47 million bushels are needed each week to meet the USDA goal for the 2011/12 marketing year.

Pro Farmer: After the Bell Soybean Recap(Source:CME)
Soybean futures faced pressure throughout the session and ended low-range with losses of 40-plus cents through the January contract; farther deferred months saw lighter losses. Soymeal and soyoil ended with moderate losses due to spillover pressure. Weekend rains were heavier and more widespread than expected, benefiting filling soybeans. This encouraged traders to book profits to start the week.

VEGOILS-Palm oil ends flat, Malaysia stocks data eyed
SINGAPORE, Aug 6 (Reuters) - Malaysian crude palm oil ended flat as expectations of higher stocks in No.2 producer Malaysia erased higher risk appetite on better-than-expected U.S. jobs data.
"In the near term, the upcoming MPOB's July inventory data could swell above the psychological range of 2 million tonnes," said Alan Lim Seong Chun, research analyst with Malaysia's
Kenanga Investment Bank, in a note.