Friday, November 23, 2012
FCPO closed : 2395, changed : -16 points, volume : higher.
Bollinger band reading : downside biased.
MACD Histogram : weakening, seller testing market.
Support : 2350, 2300, 2250, 2230 level.
Resistance : 2400, 2450, 2490, 2520 level.
FCPO clodsed lower for the 4th day with rising volume changed hand. Soy oil still pause for holiday while crude oil price currently trading little lower.
Price still move downward ahead of Monday exports figures and on slower demand concern.
Daily chart study continue recommending a downside biased market development.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with moderate cut loss and profit target.
Posted by MW Chong at 6:09 PM
FKLI closed : 1608.5 changed : -5 points, volume : lower.
Bollinger band reading : downside biased.
MACD Histogram : recovering, seller taking profit.
Support : 1600, 1595, 1590, 1580 level.
Resistance : 1610, 1615, 1623, 1627 level.
FKLI closed recorded loss again with quiet volume transacted doing about 6 points discount compare to cash market that closed lower despite regional market traded higher. Overnight U.S markets paused for holiday and today Asia markets ended in positive territory while European markets currently trading little lower.
Daily chart reading revised to suggesting a downside 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.
Posted by MW Chong at 5:41 PM
STOCKS: European shares were set to edge higher and on track for the best week in about 10 months on expectations that the pace of global economic recovery was picking up and Greece was closer to getting the next tranche of aid. Asian shares rose and were on course for a weekly gain of more than 2.5 percent, their best in two months. Activity generally was subdued, with Japanese financial markets closed for a holiday following the U.S. shutdown for Thanksgiving on Thursday. (Reuters)
FOREX-Euro rises to three-week high versus dollar
LONDON, Nov 23 (Reuters) - The euro rose to hit a three-week high versus the dollar after a source told Reuters that Greece's international lenders were inching towards an agreement debt sustainabilty.
Euro rose past option barriers at $1.2900 to hit a three-week high of $1.2908 on trading platform EBS, up 0.17 percent on the day. Stop loss buy orders are cited at $1.2920.
EU budget talks dim after gesture to French, Poles (Reuters)
Prospects of a deal on the European Union's long-term budget dimmed after a fresh compromise proposal offered concessions to France and Poland but ignored British and German demands for deeper overall spending cuts.
POLL-China's 2012/13 soybean import growth seen at 6-yr low (Reuters)
China's soybean imports will grow at their slowest pace in six years this marketing year as sluggish demand and poor crushing margins dent purchases by the world's top buyer, a Reuters poll showed.
BP, Rosneft formalise terms for tie-up (Reuters)
Oil companies BP and Rosneft came closer to sealing their tie-up deal on Thursday, winning Russian government approval for a key part of it and signing a sale and purchase agreement for scrutiny by regulators around the world.
OIL: Brent crude slipped towards $110 a barrel as weak data from Europe raised concerns about global demand and a ceasefire in the Gaza Strip eased supply concerns, overshadowing positive manufacturing data out of China. (Reuters)
EU steelmakers unhappy with EU conditions on Glenstrata deal (Reuters)
EU steelmakers said Europe's antitrust conditions for Glencore to go ahead with its $33 billion takeover of Xstrata XTA.L are not sufficient to prevent the dominant influence of one zinc supplier.
BASE METALS: London copper was steady and set to log a second week of gains after recent data fuelled hope that Chinese and U.S. economies have finally turned a corner, but the Thanksgiving holiday in the United States drained liquidity. (Reuters)
PRECIOUS METALS: Gold traded little changed but was headed for the second weekly rise in three, supported by concerns over U.S. fiscal problems and a weaker dollar. (Reuters)
METALS-LME copper steady, eyes second week of gains on China
SINGAPORE, Nov 23 (Reuters) - London copper was steady and set to log a second week of gains after recent data fuelled hope that the Chinese and U.S. economies have finally turned a corner, but the Thanksgiving holiday in the United States drained liquidity.
"We got a positive PMI number and we'll see a slight rebound from here but I don't think copper prices can explode, as they are not fundamentally supported," said Judy Zhu, an analyst with Standard Chartered in Shanghai.
PRECIOUS-Gold headed for weekly gain, US fiscal worry supports
SINGAPORE, Nov 23 (Reuters) - Gold traded little changed but was headed for the second weekly rise in three, supported by concerns over U.S. fiscal problems and a weaker dollar.
"We are stuck between $1,715 and $1,740 area for now, but speculators are still bullish on gold, as uncertainties about the 'fiscal cliff' hang around and they believe that central banks around the world will stay loose on monetary policy," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
Posted by MW Chong at 4:17 PM
VEGOILS-Palm oil edges down as demand slows, set for weekly loss
Fri Nov 23, 2012 12:33am EST
* Futures set for 1.7 pct weekly decline
* Sentiment cautious ahead of meeting to discuss Greece
* Palm oil still targets 2,321 ringgit -technicals
(Updates prices, adds detail)
By Chew Yee Kiat
SINGAPORE, Nov 23 (Reuters) - Malaysian palm oil futures
fell for a fourth straight session on Friday and were on track
for a third weekly loss in four, as investors remained concerned
over slowing demand for the edible oil as prospects for global
economic growth remained dim.
Investors were also cautious ahead of a European meeting on
Monday, when international lenders would gather for a second
time to reach a deal to release emergency aid for Greece.
Malaysia, the world's second largest palm oil producer,
exported less of the edible oil for the first 20 days of the
month compared to October, fuelling concerns over its inventory
that has hovered near record high levels.
"The market is still worried about exports, which slowed
down due to the slew of holidays last week," said a trader with
a foreign commodities brokerage in Malaysia.
"The question everybody is asking now is whether end stocks
will be lower or slightly higher. I think it should be going
down with lower production."
By the midday break, the benchmark February contract
on the Bursa Malaysia Derivatives Exchange had lost 1
percent to 2,387 ringgit ($780) per tonne.
Total traded volumes stood at 15,280 lots of 25 tonnes each,
higher than the usual 12,500 lots.
Technicals showed a bearish target at 2,321 ringgit remains
intact for palm oil based on a Fibonacci retracement analysis,
said Reuters market analyst Wang Tao.
For the week, futures were set to post a 1.7 percent decline
on worries that the U.S. budget crisis, and the euro zone's
ongoing financial woes, could weigh on demand.
Malaysian shipments of the tropical oil fell 3.3 percent and
3.8 percent for the Nov. 1-20 period from a month ago, cargo
surveyors Intertek Testing Services and Societe Generale de
Surveillance said respectively.
Traders are hoping the annual price outlook conference,
organised by the Indonesia Palm Oil Association on next Thursday
and Friday, would provide more clues about palm oil's outlook.
In related markets, Brent crude slipped towards $110 a
barrel as weak data from Europe raised concerns about global
demand and a ceasefire in the Gaza Strip eased supply concerns,
overshadowing positive manufacturing data out of China.
In other vegetable oil markets, the most active May 2013
soybean oil contract on the Dalian Commodity Exchange
edged down 0.4 percent by the midday break. The U.S. financial
markets were closed for the Thanksgiving holiday.
Posted by MW Chong at 2:27 PM
Bursa sees value of IPOs in 2013 to match 2012’s RM23bn
Bursa Malaysia is expected to match this year’s IPO value of RM22.9bn in 2013, Bursa CEO Datuk Tajuddin Atan said, although the listings may not be as impressive as this year’s mega IPOs. “Total capital expected to be raised next year is coming close to what we’re seeing this year, if economic conditions remain, although individual amounts may not be as big as the individual IPOs this year,” he said. Among companies slated to list next year include Wesport Holdings and Malakoff. (StarBiz)
Khazanah divests stake in MAHB
Khazanah sold another 8.7% stake in Malaysia Airports (MAHB) through a placement, a person familiar with the share sale said. Khazanah divested 107m shares in the airports operator at RM5.50 each for about RM589m after exercising an upsize option. Khazanah has progressively lowered its stake in MAHB to 40.4% from 67.7% in 2010 as part of the Government’s plans to reduce its local business holdings. It has also pared its holding in Telekom Malaysia and Tenaga Nasional. (StarBiz)
PKA seeks haircut on PKFZ loan
The Port Klang Authority (PKA) has approached the government with proposals to restructure its RM4.6bn Treasury loan incurred to develop the Port Klang Free Zone (PKFZ). PKA proposed to repay only RM2.76bn (or 60%) of the RM4.6bn loan that went towards the development expenses for PKFZ. The port authority argues that it does not have to pay for the cost of acquiring the land and assets as these assets ultimately belong to the government. “We borrowed money from the government but the government still owns the 1,000 acre land and all the properties, so the government doesn’t lose out,” says PKA chairman Datuk Teh Kim Poo. (Financial Daily)
A plantation workers' union has decided to file an industrial court case on alleged bonus payout discrepancies against Sime Darby Bhd's plantation division, arguing that the conglomerate had been unfair to its lower management and operation staff when it had just dished out handsome bonuses to its management staff. It was reported in early November that a good number of plantation managers and senior staff at Sime Darby took home bonus payout ranging from 12- 14 months. (Malaysian Reserve)
Guinness Anchor Bhd may see its prices for its product range increase between 2% to 4% in the next 12 months depending on the increase in cost of production and consumer market sentiment. Managing director Charles Ireland said a moderate price increase was "more likely than not" and would rather increase price gradually over a period of time than drastically in lower frequency. He said the increment would also be based on consumers' sentiment. Speaking to reporters, he said GAB has no immediate plans of introducing new labels but would "always look at the market from consumers' perspective". The company also appointed Datuk Saw Choo Boon as its chairman as he brings with him a wealth of experience to the brewery. Saw Choo Boon, 65, takes over from Tan Sri Saw Huat Lye who retires after having been on GAB's board for more than 25 years. (Starbiz)
Malaysia Airports (MAHB) has inked a deal with Mitsui Fudosan of Japan to jointly develop an upscale factory outlet centre and its complementary facilities in KLIA at an estimated cost of RM335m. Mitsui Fudosan is a real estate company listed on the Tokyo Stock Exchange. It is mainly engaged in the development of office buildings, shopping centres and factory outlets, hotels, sports and leisure, and resort facilities. The project is to be developed on a 50-acre site in KLIA over three phases. Upon completion, expected around end-2014, the project is expected to have a total lettable area of 47,000 sq m. (Financial Daily, StarBiz)
Petronas has announced successful gas production from the Berantai field, and the drilling and testing of the first well at the Balai cluster in the first and second risk service contract (RSC) areas. Natural gas production from Berantai was brought onstream on 20 Oct. The RSC was awarded to Petrofac and SapuraKencana in Jan 2011. The national oil company also announced the discovery of gas in Block PM307. (Bernama)
The city of Kuala Lumpur has been ranked fourth best for shopping in global news network CNN's survey. Tourism Minister Datuk Seri Dr Ng Yen Yen, who announced this last night, said the Government's continued effort to boost KL as a shopping haven was bearing fruit. She commended shopping malls and stores on the cooperation extended to the ministry to help make its campaigns a success. (Star)
Tan Chong aims to sell 3,000 units of its new Nissan Almera a month. This was driven by over 7,000 bookings for Almera within two weeks of the launch in October. By January 2013, it expects the bookings to reach 10,000 units. (Financial Daily)
Ireka Corp Bhd has obtained an investment certificate to import and distribute computer hardware, programming, consultancy and computer system management in Ho Chi Minh City, Vietnam. The certificate was from the city’s People’s Committee, a 13-member executive council. The company will operate the business under the name i-Tech Network Solutions (Vietnam) Co Ltd. (BT)
Iris Corp Bhd has been awarded a RM39.5m contract by the Federal Land Development Authority (Felda) to build and develop an integrated community centre in Felda Tenggaroh, Mersing. The new modern rural project is to further assist the government in uplifting the social and economic standing of the Felda settlers and to create an agriculturally progressive community and environment. The company said the project, called "Sentuhan Kaseh", will be financed through internally generated funds and bank borrowings. The contract period is from Nov-2012, to Feb-2013. (BT)
Zelan Bhd's Meena Plaza in Abu Dhabi has run into trouble following project owner Meena Holdings LLC's decision to terminate the contract. The group said its legal counsels are instructed to initiate legal actions to challenge the purported termination of contract and to liquidate the performance bond. In March 2008, Zelan had announced that the contract value was RM771m. (StarBiz)
AirAsia may add only 1 more hub
AirAsia said it may add only one more major hub for expansion as it focuses on boosting profits from Malaysia, Thailand and Indonesia in the next three years. Taiwan, South Korea, Vietnam and India are among the potential markets for a new base. Meanwhile, the discount carrier aims to increase annual profit from its three main markets to RM1bn each. (Malaysian Reserve)
AirAsia Bhd has been granted an air operator's certificate (AOC) to fly for another five months instead of a two year period for not meeting regulatory standards. The current AOC is valued until Apr 2013. Sources say this occurred after periodical audit findings by the Department of Civil Aviation showed shortcomings in AirAsia's flight operations procedures and practices. This included failed communications between flight operations and pilots, an outdated manual and flight operations not keeping with the manual. It is also understood that AirAsia's head for flight operations has been charged due to the action. One source said, "The fact that they have not grounded AirAsia aircraft shows that it's not a serious safety issue, but this action still serves as a warning". (Sun Biz)
YTL Corp net profit soars 56% y-o-y in 1Q
YTL Corp's net profit rose 55.6% y-o-y to RM391.9m in 1QFY13. This was mainly due to the better performance of its cement operations, unrealised foreign exchange gains and derivative gains recorded by an offshore subsidiary. The cement and utilities divisions continued drive the group's growth while the reorganisation of its property development and real estate investment trust businesses, completed over the past year, had successfully streamlined and improved the divisions' operational efficiency. (BT)
Gadang Holdings Bhd is expected to replenish its construction orderbook by RM500m in six months' time from its current tendering of projects worth RM3bn. According to MD Tan Sri Kok Onn, Gadang has an orderbook of RM1.6bn at present. “We are also interested to further participate in the Klang Valley Mass Rapid Transit (KVMRT) project for Line 2,” he told StarBiz after the company's AGM recently. Currently, Gadang, mainly involved in construction and property development, has already started work on the V2 package of KVMRT valued at RM863m, which is the biggest project in its orderbook.Other works include Shah Alam Hospital project valued at RM410mil and newly secured phase 1 of site preparation work for the proposed Refinery and Petrochemical Intergrated Development (Rapid) project valued at RM312.8m. (Starbiz)
Fajarbaru Builder Group Bhd has emerged as a substantial shareholder in PA Resources Bhd with a 9.16% stake or 78.8m shares.A filing with Bursa Malaysia on Thursday showed Fajabaru bought 74.15 million shares by subscribing for the rights issue.The subscription was carried out on Tuesday. (Starbiz)
Bina Goodyear Bhd has suspended its senior general manager (finance) pending investigation into the accounting records of the company, according to a filing with Bursa Malaysia. The company had recently been classified as a Practice Note 17 company due to a provision of RM29.6m for its work-in-progress.It has appointed PKF Advisory Sdn Bhd to conduct a special audit to look into the provision and the related matters. (Starbiz)
UEM Group may soon know the outcome of its bid for the privatisation of bridges and highways in Turkey. The Privatisation Administration of Turkey (OIB) is expected to decide on the privatisation by year end, the group said. Grp MD/CEO Datuk Izzaddin Idris said UEM and its JV partners are in discussions with OIB on the bid they had submitted. UEM's partners are Turkish industrial conglomerate KOC Holding and financial services firm Gozde Girisim Sermaesi Yatirim Ortakligi. UEM and KOC Holdings each own 40% stake in the JV while Gozde holds the balance. The three joint venture partners last month submitted a bid for the privatisation of two bridges over the Bosphorus Straits in Istanbul and seven motorways across Turkey. (BT)
Bank Negara Malaysia’s (BNM) international reserves amounted to RM424.9bn (US$138.6bn) as of 14 Nov, up from RM423.9bn (US$138.3bn) as of 31 Oct. The reserves position was sufficient to finance 9.2 months of retained imports and is 4.2 times the short-term external debt. (BNM)
South Korea's currency authorities bought at least US$1bn worth of dollars to weaken the Korean won, according to traders, and warned of further action to put a brake on the surging currency. (WSJ)
China: Manufacturing expands in Nov
Chinese manufacturing activity improved for the first time in more than a year in November, the preliminary reading of a survey by HSBC showed Thursday. The so-called flash manufacturing Purchasing Managers' Index (PMI) for Nov printed at 50.4 - above the 50-point threshold that separates improvement from deterioration - for the first time in 13 months. In Oct, the final reading of the HSBC China manufacturing PMI came in at 49.5. (MarketWatch)
EU: Leaders to begin spars over budget
European Union leaders fought to protect national interests in setting the bloc’s next seven-year budget, dogged by the debt crisis in the euro zone, tensions between rich and poor countries and Britain’s insistence on keeping its money-back guarantee. Starting with UK Prime Minister David Cameron, the leaders trooped into EU President Herman Van Rompuy’s office for one-on-one consultations to weigh a proposed EUR1.03tn spending package for 2014-2020. (Bloomberg)
EU: Euro-zone Nov PMI points to further activity fall
Private-sector activity across the 17-nation euro zone continued to contract at a rapid pace in Nov, the preliminary Markit euro-zone composite Purchasing Managers' Index (PMI) for the region showed. The index edged up to 45.8 from 45.7 in Oct, but remained well below the 50 level that indicates flat activity. (MarketWatch)
Eurozone consumer confidence slipped to -26.9 this month from a revised Oct figure of -25.7. (Reuters)
US: Housing starts highest in more than four years
Construction on new homes rose in October to the highest rate in more than four years in another sign of a strengthening US housing market. Housing starts rose 3.6% last month to a seasonally adjusted annual rate of 894,000, the highest rate since July 2008. Starts are up 42% from last year, though the rate remains far below a bubble peak of almost 2.3m in 2006. (MarketWatch)
US: Initial jobless claims drop to 410,000
First-time applications for unemployment benefits declined sharply last week, government but the number of new claims filed remains at high levels due to the after-effects of Hurricane Sandy. Initial jobless claims dropped by 41,000 to a seasonally adjusted 410,000 in the week ended 17 Nov. (MarketWatch)
GLOBAL MARKETS-Shares set for weekly gain as outlook improves
SINGAPORE, Nov 23 (Reuters) - Asian shares marked time but were on course for a weekly gain of nearly 2 percent, after manufacturing surveys from China and the United States raised hopes that the global growth outlook is improving at last.
The euro was also enjoying a positive week, despite data on Thursday pointing to the euro zone sliding into its deepest recession since 2009, with the currency standing up around 1 percent on last Friday's close on optimism that a funding deal for debt-choked Greece will ultimately be agreed.
FOREX-Euro boosted by Greece aid deal hopes, yen wobbly
LONDON, Nov 22 (Reuters) - The euro hit its highest point against the yen since late April on Thursday on expectations that international lenders will soon agree an aid deal for Greece and that Japan will ease monetary policy again.
"The lack of any really bad news today has helped euro higher after the failure of lenders to agree on a Greece deal earlier in the week," said Saeed Amen, quantitative FX Strategist at Nomura.
OIL - Oil dips in holiday-thinned trade on Gaza, EU data
NEW YORK, Nov 22 (Reuters) - Oil dipped in moribund trade on Thursday, as a ceasefire in the Gaza Strip eased supply concerns and gloomy manufacturing data for Europe tempered upbeat figures from China.
"I think it will last...but it seems as if the market is pretty sceptical," said Thorbjørn Bak Jensen, an analyst at A/S Global Risk Management.
Brazil's HRT ups estimated Namibia offshore oil, gas
RIO DE JANEIRO, Nov 22 (Reuters) - Brazil's HRT Participações em Petróleo SA said on Thursday that it had raised its estimated oil and equivalent natural gas in four offshore exploration blocks in Namibia by 457 million barrels of oil and natural gas equivalent (boe).
The Rio de Janeiro-based company said in a statement that it has 7.391 billion boe of "mean potential prospective resources" in the blocks, according to an assessment made by U.S. oil consulting group DeGolyer & MacNaughton (D&M) based on three-dimensional seismic data.
Pemex to announce Chicontepec oil auction in 3 weeks
MEXICO CITY, Nov 22 (Reuters) - Mexico's state-run oil company Pemex will announce in three weeks the auction of six blocks in its massive Chicontepec basin which contain roughly 400 million barrels of crude reserves each, the company said on Thursday.
The blocks make up 15 percent of the basin's total reserves, and Pemex says it expects to award the contracts in July 2013.
BP, Rosneft formalise terms for tie-up
LONDON, Nov 22 (Reuters) - Oil companies BP and Rosneft came closer to sealing their tie-up deal on Thursday, winning Russian government approval for a key part of it and signing a sale and purchase agreement for scrutiny by regulators around the world.
The deal, announced in October, involves BP selling its 50 percent interest in Russia's third largest oil firm TNK-BP to Rosneft. In exchange, BP gets $12.3 billion of cash and an 18.5 percent stake in an enlarged state-backed Rosneft which exerts increasing control over production in the world's biggest producing country.
OPEC seaborne exports to rise in 4 weeks to Dec 8-analyst
LONDON, Nov 22 (Reuters) - Seaborne oil exports from OPEC, excluding Angola and Ecuador, will rise by 640,000 barrels per day (bpd) in the four weeks to Dec. 8, an analyst who estimates future shipments said on Thursday.
Exports will reach 24.72 million bpd on average, compared with 24.08 million bpd in the four weeks to Nov. 10, UK consultancy Oil Movements said in its weekly estimate.
UAE's ADNOC to store crude in S.Korean facility for 3 yrs -KNOC
SEOUL, Nov 22 (Reuters) - The UAE's state-run energy giant Abu Dhabi National Oil Co (ADNOC) will lease oil storage facilities in South Korea capable of storing six million barrels of crude for three years, state-run Korea National Oil Corp (KNOC) said on Thursday.
This is the first time the United Arab Emirates' ADNOC has leased storage in South Korea, a KNOC spokesman said. It becomes the twelfth international company to hold storage facilities located in the world's fifth-largest crude importer, joining other producers, oil majors and investment banks.
IEA sees Asia paying less for LNG as prices converge
TOKYO, Nov 22 (Reuters) - Asia should benefit from the convergence of global liquefied natural gas markets amid signs of change for its pricing structure linked to oil, the head of the West's energy watchdog told Reuters on Thursday.
Gas has historically been pegged to the oil market through long-term contracts, because both fuels used to be produced by the same exporters and were often used in the same industries.
Small fire hits Venezuela's Cardon refinery naphtha unit
PARAGUANA, Venezuela, Nov 22 (Reuters) - A small fire hit the naphtha unit of Venezuela's 310,000 barrel per day Cardon refinery, workers said on Thursday, though the unit was already halted for maintenance.
"The fire was extinguished within 10 minutes," a worker told Reuters. State oil company PDVSA was not immediately available to comment.
Russia's Sberbank in talks over TNK-BP takeover finance
FRANKFURT, Nov 22 (Reuters) - Sberbank , Russia's biggest bank, is in discussions over financing a takeover of oil company TNK-BP by state-controlled Rosneft , the lender's Chief Executive German Gref said.
Banking sources last week said that Rosneft was receiving banks' initial commitments to a $32.5 billion loan to back its $55 billion acquisition of TNK-BP.
Posted by MW Chong at 11:38 AM
Asian Stocks Outside Japan Swing From Loss to Gain
Asian stocks outside Japan swung between gains and losses as Lynas Corp. advanced and LG Electronics Inc. fell. Lynas, builder of the largest rare-earth refinery in Malaysia, climbed 5.2 percent in Sydney as it prepares to start production in the Southeast Asian country. Ivanhoe Australia Ltd. dropped 9.7 percent after the mining company controlled by Rio Tinto Group sold shares at a discount. LG Electronics Inc., a South Korean electronics maker that gets about 16 percent of its sales in Europe, slipped 2.5 percent in Seoul before talks on a Greek bailout package continue next week. The MSCI Asia Pacific Excluding Japan Index (MXAPJ) rose 0.1 percent to 440.53 as of 9:20 a.m. in Hong Kong, erasing losses of 0.1 percent. The gauge is heading for its first weekly advance in three weeks as data on China manufacturing, U.S. jobs and housing added to signs the world’s two largest economies are on the mend.
“It is looking like a fairly subdued day,” said Cameron Peacock, Melbourne-based analyst at IG Markets Ltd., a provider of trading services for equities, bonds and currencies. “European leaders will be tied up with Greece and European budget discussions for the next few days.” Taiwan’s Taiex Index (TWSE) advanced 1.6 percent, while Singapore’s Straits Times Index added 0.1 percent. South Korea’s Kospi Index lost 0.1 percent and Australia’s S&P/ASX 200 Index dropped 0.2 percent. Japanese markets are shut today, while those in the U.S. were closed yesterday for holidays. Markets in China and Hong Kong have yet to open.
Hong Kong’s Hang Seng Index Headed for Best Week Since September
Hong Kong stocks rose, with the Hang Seng Index (HSI) heading for its biggest weekly gain since September. China Rare Earth Holdings Ltd. jumped after a report that the nation will extend subsidies to the industry. China Rare Earth rose 4.7 percent. China Resources Enterprise Ltd., the government-backed partner of SABMiller Plc., gained 1.8 percent after reporting an increase in sales. Citic Pacific Ltd. (267), building the world’s largest magnetite iron- ore mine, advanced 1.3 percent after it was granted an injunction to stop Mineralogy Pty Ltd. from terminating mining rights and site lease agreements in Australia. China “will be able to avoid a hard landing; we’ve seen a much further-than-expected rebound in manufacturing and exports,” Norman Chan, head of investment at Calibre Asset Management Ltd., a unit of National Australia Bank Ltd., said in a Bloomberg television interview in Hong Kong. “China is a very momentum-driven market and sometimes it takes a lot of government policies to drive a situation.” The Hang Seng Index rose 0.3 percent to 21,818.10 as of 10:25 a.m. local time, with almost six stocks gaining for each that fell in the 49-member gauge. It is headed for a 3 percent increase this week. The Hang Seng China Enterprises Index (HSCEI) of mainland companies listed in the city increased 0.7 percent to 10,569.58. Trading volume on the Hang Seng Index was about 38 percent below the 30-day intraday average for the time of the day, according to data compiled by Bloomberg. The gauge advanced 20 percent through yesterday from this year’s low on June 4 as economic data showed China’s slowdown may be bottoming and central banks around the globe added stimulus to spur growth.
China’s Stocks Gain as Shanghai Index Heads for Weekly Advance
China stocks gained, with the benchmark index poised for its first weekly gain in three weeks, as material and consumer-staple companies advanced. Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co. climbed 2.5 percent after the Financial Times reported China will offer rare-earth producers subsidies. Baoshan Iron & Steel Co. advanced 1.1 percent after buying back shares. Wuliangye Yibin Co. rallied following a six-day slump amid concerns over the quality of Chinese liquor products. JiuGuiJiu Co. (000799) slumped 10 percent after a four-day trading halt as it apologized for excessive levels of plasticizer in its drinks. The Shanghai Composite Index gained 0.7 percent to 2,029.09 as of 10:13 a.m. local time, taking its increase this week to 0.7 percent. The CSI 300 Index (SHSZ300) climbed 0.9 percent to 2,196.53. The Hang Seng China Enterprises Index (HSCEI) of Chinese companies traded in Hong Kong added 0.8 percent.
Shanghai Composite trading volumes were 15 percent lower than the 30-day average for this time of day, according to data compiled by Bloomberg. Thirty-day volatility on the index was at 13.3, compared with this year’s average of 17.4. Vice Premier Li Keqiang, who will become premier in March, vowed to deepen reforms to promote scientific development and transform the pattern of economic development, the official Xinhua News Agency reported. The nation needs to break all “systematic” obstacles that hinder scientific development, the report cited Li as saying. The provincial government of eastern Zhejiang introduced 12 detailed policies for financial reform in Wenzhou city, Xinhua reported, citing the city’s government. It’s possible the nation may widen the yuan’s trading band in the first quarter, Xinhua reported separately, without citing anyone. The Bloomberg China-US 55 Index (CH55BN), the measure of the most- traded U.S.-listed Chinese companies, did not trade as U.S. markets were closed for a holiday.
European Stocks Advance on China Manufacturing Expansion
European (SXXP) stocks advanced for a fourth day, posting the longest winning streak in five weeks, after a report signaled Chinese manufacturing expanded for the first time in 13 months. SABMiller Plc (SAB), the world’s second-largest brewer, jumped the most in 13 months after reporting first-half profit that beat estimates. Daily Mail & General Trust Plc (DMGO), publisher of Britain’s Daily Mail newspaper, surged the most in 3 1/2 years after announcing a share buyback. Alcatel-Lucent SA soared 16 percent after the company was said be in financing talks with Goldman Sachs Group Inc. The Stoxx Europe 600 Index rose 0.6 percent to 271.7, a two-week high, at the close in London. The benchmark gauge has rallied 16 percent from its 2012 on June 4 as the European Central Bank and the Federal Reserve expanded their asset- purchase plans. The U.S. markets are closed today for the Thanksgiving holiday.
“Everyone is waiting for the brakes to be eased a bit after the new formation of the government,” said Christian Zogg, who manages about $540 million as head of equity and fixed income at LLB Asset Management AG in Vaduz, Liechtenstein. “If the Chinese economy wants to grow about 8 percent, it needs a purchasing managers’ index that’s over 50.” A PMI released today by HSBC Holdings Plc and Markit Economics showed a preliminary reading of 50.4 for November, adding to signs that growth in the world’s second-largest economy is rebounding after a seven-quarter slowdown. That compared with a final level of 49.5 in October. A reading above 50 indicates expansion.
Emerging Stocks Rise as Volatility Hits 2004 Low on China
Emerging-market stocks advanced for a fourth day, with price swings in the benchmark index falling to an eight-year low, as a gauge of Chinese manufacturing climbed and Israel agreed to a cease-fire with Hamas. MRV Engenharia e Participacoes SA led homebuilders higher in Sao Paulo after an inflation report spurred speculation Brazil will be able to keep borrowing costs at a record low. Samsung Electronics Co. (005930), the world’s largest maker of televisions and mobile phones, pushed a gauge of technology companies to a two-week high. OAO RusHydro had the biggest gain in more than two months as Russian President Vladimir Putin approved a cash injection for the country’s largest renewable energy producer. Israel’s shekel climbed versus the dollar.
The MSCI Emerging Markets Index (MXEF) rose 0.5 percent to 985.72 in New York, its highest close since Nov. 12. The index’s 50-day volatility fell to 9.11, the lowest since Sept. 2004. A Chinese manufacturing index signaled the first expansion in 13 months, a survey of purchasing managers showed. Israel and the Palestinian militant group Hamas agreed to a cease-fire yesterday after talks brokered by Egypt’s Islamist leaders and the U.S. The China report “was better than expected and indicates the economy has possibly begun expanding again,” Christopher Palmer, who helps manage $2.5 billion of assets as a London- based director of global emerging markets for Henderson Global Investors Ltd., said by e-mail. “For most investors China remains the main show.” The preliminary reading was 50.4 for the Chinese purchasing managers’ index released today by HSBC Holdings Plc and Markit Economics. That compares with a final level of 49.5 for October. A reading above 50 indicates expansion.
Bovespa Index Advances After China Manufacturing Report
The Bovespa (IBOV) index rose for the second time in three days as homebuilders rallied after a report showing inflation slowed in November spurred speculation Brazil will be able to keep borrowing costs at a record low. MRV Engenharia e Participacoes SA was the best performer on the BM&FBovespa Real Estate Index (IMOBBV), which climbed to a one-week high. Banco Bradesco SA rose to the highest level since Sept. 24 after it announced a partnership with cellular phone operator Claro for mobile payments. Brazil’s benchmark equity index added 0.3 percent to 56,436.97 at the close of trading in Sao Paulo. Thirty-six stocks rose on the Bovespa while 31 declined. The real was little changed at 2.0989 per U.S. dollar after weakening yesterday to a three-year low. Brazil’s swap rates fell on most contracts after a report showed consumer prices increased at a slower pace in the month through mid-November.
“Inflation seem to be coming in more or less in line with what the central bank expects, which supports the idea that interest rates won’t rise in the near future,” Alvaro Bandeira, a partner at Orama Asset Management, said by phone from Rio de Janeiro. The IPCA-15 price index gained 0.54 percent, the national statistics agency reported today. While it exceeded the 0.51 percent median estimate of analysts surveyed by Bloomberg, it was lower than the previous reading of 0.65 percent. Brazil’s central bank President Alexandre Tombini said in a congressional hearing today inflation will converge to the bank’s 4.5 percent target in the third quarter of 2013. MRV gained 2.8 percent to 10.60 reais. PDG Realty SA rose 1.4 percent to 2.85 reais while Cyrela Brazil Realty SA Empreendimentos e Participacoes added 1.9 percent to 17.48 reais.
Korean Won Falls as Intervention Concerns Counter China Optimism
South Korea’s won weakened for a third day as concerns that the government will act to stem currency gains offset optimism the Chinese economy is set for recovery. Government bonds were steady. South Korea’s Deputy Finance Minister Choi Jong Ku said yesterday there is “herd behavior” in currency market and that the government will take action to curb excessive fluctuations. The won is the best-performer among 11 most-traded Asian currencies since end of June. A preliminary reading released yesterday signaled China’s manufacturing may expand in November for the first time in 13 months. “There’s risk appetite in the market with data from China, but caution against government intervention will restrict won gains,” said Kim Dong Young, a Seoul-based currency dealer for Industrial Bank of Korea. The won dropped 0.1 percent to 1,086.68 per dollar as of 10:04 a.m. in Seoul, according to data compiled by Bloomberg. It touched 1,080.05 yesterday, the strongest level since Sept. 9, 2011. The currency appreciated 0.6 percent this week.
One-month implied volatility, a measure of exchange-rate swings used to price options, fell 18 basis points, or 0.18 percentage point, to 5.72 percent. The U.S. told Japan and South Korea it detected North Korean preparations to launch a long- range ballistic missiles, the Asahi newspaper reported, without saying where it got the information.
The yield on the government’s 2.75 percent bonds due September 2017 was unchanged at 2.90 percent, Korea Exchange Inc. prices show. The rate rose six basis points this week. The one-year interest-rate swap was steady at 2.79 percent today and climbed two basis points this week.
Yen Gains Versus Peers on Bets Recent Losses Overdone
The yen climbed versus most of its 16 major peers as technical indicators signaled its recent drop may have been too rapid and as a contraction in euro-area manufacturing and services damped global growth prospects. Japan’s currency pared a weekly decline that comes as opposition leader Shinzo Abe, who is favored to become the country’s next prime minister after elections on Dec. 16, increased pressure on the Bank of Japan (8301) to add to stimulus measures that tend to weaken the yen. The euro traded near its highest level in three weeks on prospects finance ministers will agree on an aid package for Greece next week, even after a report showed the region slipped back into a recession. “Some investors may think the recent rally in dollar-yen has been a bit over-extended and it’s time for a bit of a correction,” said Lee Wai Tuck, a currency strategist at Forecast Pte in Singapore. “We’ve recently got confirmation of a technical recession in the euro zone, so going ahead things are still pretty uncertain.”
The yen rose 0.1 percent to 82.37 per dollar as of 9:30 a.m. in Singapore after touching 82.84 yesterday, the weakest since April 4. It added 0.2 percent to 106.09 per euro. Europe’s shared currency bought $1.2880 from $1.2884 yesterday, when it climbed to $1.2899, the highest since Nov. 2. The yen is set for a 1.3 percent drop versus its U.S. counterpart this week. The euro advanced 1.1 percent against the greenback since Nov. 16.
A Chinese manufacturing index signaled the first expansion in 13 months, adding to signs that economic growth is rebounding after a seven-quarter slowdown.
The preliminary reading was 50.4 for a purchasing managers’ index released today by HSBC Holdings Plc (HSBA) and Markit Economics. It compares with a final level of 49.5 for October. A reading above 50 indicates expansion. Gains in manufacturing bolster prospects for a sustained pickup in economic growth that slowed last quarter to the weakest pace in more than three years. A rebound may smooth a once-a-decade leadership transition for the ruling Communist Party, set to install Li Keqiang as premier in March, and reduce the likelihood of additional monetary stimulus. “The economic recovery continues to gain momentum,” Qu Hongbin, chief China economist at HSBC in Hong Kong, said in a statement. “However, it is still the early stage of recovery and global economic growth remains fragile.”
The MSCI Asia Pacific Index climbed 0.8 percent as of 6:37 p.m. in Tokyo, headed for its highest close in two weeks. The Shanghai Composite Index closed 0.7 percent lower after the biggest gain in three weeks yesterday, as waning speculation of lower bank reserve requirements overshadowed an increase in the PMI.
Cure for Economic Slumps Seen in Raising Rates: Cutting Research
The solution to weak economic growth may be higher interest rates. That seemingly paradoxical remedy can apply if the cause of the slump is a confidence shock that cheap borrowing costs are failing to reverse, two Columbia University economists said in a report published this week. In such a situation, ultra-easy monetary policy risks making fears of deflation a self- fulfilling prophecy as spenders sit tight. If low interest rates can’t motivate jittery consumers, then the answer may be the opposite: an increase in borrowing costs. Such a shift “can boost inflationary expectations and therefore foster employment,” said Stephanie Schmitt-Grohe and Martin Uribe in the study published Nov. 19 by the National Bureau of Economic Research in Cambridge, Mass. “By its effect on real wages, future inflation stimulates employment, thereby lifting the economy out of the slump,” they said.
The academics said sagging confidence among households and companies has played a part in the recent economic slowdown. Evidence from the U.S. as well as Japan during the last two decades “seems to suggest that zero nominal interest rates are not doing much to push inflation higher.” At the moment, the Federal Reserve pledges to keep its benchmark interest rate near zero through mid-2015.
Debt Burden Adds to Won Gains in Crimping Korea Rebound
South Korean consumers faced with falling home prices and elevated household debt are cutting spending, dragging on demand just as export growth is restrained by gains in the won. Borrowing and credit purchases rose to a record 937.5 trillion won ($864 billion) in the third quarter, the Bank of Korea said yesterday. At the same time, an index of household consumption fell to a record low, according to a Statistics Korea report last week. Candidates campaigning for a Dec. 19 presidential election have highlighted household debt as a weakness that remains in South Korea’s economy even after three credit-rating companies upgraded the nation this year. The ruling party’s Park Geun Hye, who leads in polls, proposes an 18 trillion won fund to help avoid defaults by the indebted poor.
“The candidates are all throwing out policy pledges to reduce household debt because it is the biggest risk in the Korean economy,” said Kim Hyeon Wook, an economist at the Seoul-based SK Research Institute and a former Bank of Korea adviser. “The data show the debt is keeping people from spending and that they are saving as a precautionary measure.” Household debt reached a record 164 percent of disposable income last year, which compares with 138 percent in the U.S. at the start of the housing crisis, according to Royal Bank of Scotland Group Plc.
EU Spars Over Budget as Chiefs See Possible Deadlock
Divisions between rich and poor countries flared over the European Union’s next seven-year budget, leading German Chancellor Angela Merkel to rule out an accord until the new year. France defended farm subsidies, Britain clung to a rebate and Denmark demanded its own refund, while countries in eastern and southern Europe said reduced financing for public-works projects would condemn their economies to lag behind the wealthier north. “Positions remain too far apart,” Merkel told reporters early today after the first session of a summit in Brussels. “Probably there will be no result at the end of this summit. There may be some progress but it is probable that we will need to meet again at a second stage.” The political stakes dwarf the economic significance of spending equal to 1 percent of European gross domestic product, offering a glimpse of where the power lies in the 27-nation European Union and whether the euro-area crisis is bringing the bloc closer together or driving it apart.
The stalemate came two days after finance ministers argued in vain for more than 11 hours over how to dig debt-stricken Greece out of its fiscal hole, in another reflection of the rich-poor divide that scars the European economy. In the budget debate, the numbers have been whittled down since the first proposal came out in mid-2011. The latest draft foresaw spending of 973 billion euros ($1.3 trillion) for the 2014-2020 period, down 6 percent from the original European Commission proposal and 2 percent from the 994 billion euros for the current seven-year period.
German Business Confidence May Decline to Near 3-Year Low
German business confidence probably fell to the lowest in almost three years in November as a recession in the euro area damped growth in Europe’s largest economy. The Ifo institute’s business climate index, based on a survey of 7,000 executives, will fall to 99.5 from 100 in October, according to the median forecast of 48 economists in a Bloomberg News survey. That would be the seventh straight decline and the lowest reading since January 2010. Ifo releases the report at 10 a.m. in Munich today. While German growth slowed less than forecast in the third quarter, the euro area, Germany’s largest trading partner, slipped into recession and the outlook for the global economy has dimmed. That’s making companies more cautious, even after the European Central Bank’s announcement of a new bond-purchase program eased financial-market concerns about the sovereign debt crisis and a potential break-up of the monetary union.
“While financial markets have calmed down, German companies don’t fully trust the lull and are holding back on investment,” said Christian Schulz, an economist at Berenberg Bank in London. “Because of the general global economic weakness, there’s also a risk that the German economy will stagnate or even shrink in the fourth quarter.” Ifo’s measure of executives’ expectations probably fell to 93, the lowest since May 2009, from 93.2 in October, while a gauge of the current situation may have slipped to 106.3 from 107.3, the survey shows.
Hollande Risks Squandering French Bonds’ Sweet Spot
President Francois Hollande risks squandering an opportunity to rekindle France’s stalled economy after the nation’s latest credit rating downgrade did little to push up yields. French 10-year bond yields have barely budged since Moody’s Investors Service Inc. on Nov. 19 followed Standard & Poor’s January decision to strip France of its top rating, rising about 10 basis points to 2.18 percent. Borrowing costs have declined since Hollande’s May election, prompting him to boast last week that 10-year yields near their Aug. 3 record low of 2.002 percent validate his policies. Far from it, say strategists such as Michael Quach at Smith & Williamson Investment Management in London, who sees French bonds benefiting from European Central Bank actions and pledges. Also, being higher rated than Italy and offering better returns than German debt, France is in a bond market sweet spot that belies its woes of almost no growth, unemployment at a 13-year high and an Hollande revival plan that Moody’s calls inadequate.
“Moody’s doesn’t necessarily provide new information about France but its move did put a spotlight on the country,” Quach said. “French yields are historically low because of the global backdrop and what the ECB has done. France should use this opportunity to get reform through because we don’t know how long the market will be in this condition and when investors will lose their patience.” Investors are demanding 73 basis points more to hold French 10-year bonds than comparable German bunds, down from 200 points a year ago and 143 basis points when Hollande took office.
Euro-Area Slump Persists as Chinese Factories Recover
Euro-area services and manufacturing output shrank for a 10th month in November as the debt crisis hurt confidence, underscoring divergences in the global economy as China’s factories showed the first growth in more than a year. A composite index based on a survey of purchasing managers in both industries in the euro zone was little changed at 45.8 compared with 45.7 in October, London-based Markit Economics said today. A Chinese manufacturing index climbed to 50.4 from 49.5 last month, HSBC Holdings Plc and Markit said in a separate report. A reading above 50 indicates expansion. The economy of the 17 euro nations has slipped back into a recession and the European Commission cut its 2013 growth forecast this month. Sentiment is being undermined by a deadlock over Greek aid and tensions over European Union budget talks that start today in Brussels. Gains in Chinese manufacturing, meanwhile, bolster prospects for a sustained pickup in the world’s second-largest economy.
“Unfortunately, this time around Europe won’t be able to bank on the Chinese recovery to lift its economy out of the quagmire,” saidJulian Callow, chief international economist at Barclays Capital in London. “The composition of growth in China is moving to consumption, away from investment which has traditionally been where Europe’s exporters would have benefited.”
Sugar Rises as Rainfall May Cut Brazilian Supplies; Cocoa Drops
Sugar rose in London on speculation that excess rain will reduce output in Brazil, the world’s largest producer. Cocoa fell, erasing earlier gains. Sugar-cane producing areas in Brazil will have rain this week, after irregular precipitation in the previous 10 days helped speed up the harvest, weather consultant Somar Meteorologia said Nov. 20. Moisture in Center South, the main growing area, by the weekend may affect fieldwork and harvesting, Somar said Nov. 19. “There’s about a month left in the crushing season, but there are some rains maybe cutting that short and forcing mills to leave cane in the field,” Keith Flury, an analyst at Rabobank International in London, said by phone today. White, or refined, sugar for delivery in March rose 0.8 percent to settle at $522.40 a metric ton on NYSE Liffe in London. ICE Futures U.S. in New York, where investors trade raw sugar, cocoa and arabica coffee, is closed today for the Thanksgiving holiday.
Cocoa for delivery in March fell 0.8 percent to 1,573 pounds ($2,506) a ton in London. Prices earlier rose as much as 0.7 percent on signs of increasing demand from processors. Cargill Inc. is ramping up cocoa processing after a slowdown earlier this year, Jos de Loor, president of the company’s cocoa and chocolate unit, said in an interview yesterday. Global grindings will rise 2.5 percent to 3.5 percent in the 2012-13 season begun last month, he said. Bean demand will outpace supply by about 50,000 metric tons in the period, according to the International Cocoa Organization. Robusta coffee for delivery in January advanced 0.6 percent to $1,873 a ton after declining 2.2 percent in the previous four sessions.
Oil Pares Weekly Gain as Middle East Tension Eases on Cease-Fire
Brent oil fell for a second day in London, paring a weekly gain, as a cease-fire between Israel and Hamas eased concern that tension in the Middle East will disrupt the region’s crude supplies. Futures slid as much as 0.3 percent, matching yesterday’s decline. The cease-fire crafted by Egypt and the U.S. halted eight days of aerial assaults that ravaged the Gaza Strip and made Tel Aviv a missile target. West Texas Intermediate futures have dropped in New York since the Nov. 21 accord. There was no floor trading in the U.S. yesterday because of the Thanksgiving holiday, and electronic transactions will be booked with today’s trades for settlement purposes.
Brent oil for January settlement fell as much 38 cents to $110.17 a barrel on the London-based ICE Futures Europe exchange and was at $110.24 at 10:04 a.m. Singapore time. Prices slipped 31 cents to $110.55 yesterday. Futures are up 1.2 percent this week and 2.7 percent this year. The European benchmark grade traded at a premium of $23.32 to its U.S. counterpart. WTI for January delivery was at $86.92 a barrel in electronic trading on the New York Mercantile Exchange, down 0.5 percent from the Nov. 21 close. The contract has gained 0.3 percent this week and dropped 12 percent this year. Brent in London has technical resistance along its 200-day moving average, around $111.68 a barrel today, according to data compiled by Bloomberg. Futures have halted advances below this indicator twice so far this month. Sell orders tend to be clustered near chart-resistance levels.
New York crude futures may decline next week after the tension eased in the Middle East, a Bloomberg survey showed. Twelve of 27 analysts and traders, or 44 percent, forecast prices will decrease through Nov. 30. Nine respondents, or 33 percent, predicted a gain. Six forecast little change.
Gold Set for Weekly Gain as Central Banks, Investors Boost Stake
Gold is poised for a weekly advance after investors boosted holdings to an all-time high and central banks added to reserves as Europe’s debt crisis persisted. Palladium headed for the best week in more than two months. Spot gold traded at $1,729.82 an ounce at 9:51 a.m. in Singapore compared to $1,729.55 yesterday. The metal, poised for a 12th annual gain, is 0.9 percent higher this week. Holdings in bullion-backed exchange-traded products rose to 2,605.318 metric tons on Nov. 21, according to data compiled by Bloomberg. Kazakhstan, Turkey and Russia boosted reserves in October, according to data on the International Monetary Fund’s website this week, joining Brazil, which raised holdings to the highest in more than 11 years. European Union leaders are unlikely to reach a budget deal at the end of a summit this week, German Chancellor Angela Merkel said early today in Brussels.
“The uncertainty in Europe is coming to fore again and that should be good for gold,” said Dong Zhuying, an investment consultant at Haitong Futures Co., a unit of China’s second- largest brokerage by market value. “Buying appears to be strong at the institutional, government and investor levels.” Gold for December delivery was at $1,729.60 an ounce on the Comex in New York, from $1,728.20 on Nov. 21. There was no settlement yesterday because of the Thanksgiving holiday. The euro slid 0.1 percent against the dollar as Merkel ruled out a budget accord until the new year. The U.S. Mint sold 67,000 ounces of gold coins so far in November, exceeding the 59,000 ounces for all of October, according to data on the Mint’s website. At that pace, sales for the month would be 100,500 ounces, up 145 percent from a year earlier. Billionaire investors George Soros and Louis Moore Bacon raised stakes in the biggest gold ETP in the third quarter.
Palladium fell 0.3 percent to $653.75 an ounce, paring this week’s gain to 4.2 percent, the best run since the five days to Sept. 14. Spot silver was unchanged at $33.345 an ounce, 3.1 percent higher this week and near the highest level in more than a month. Cash platinum gained 0.3 percent to $1,581.60 an ounce, set for a third weekly climb, the best such run since February.
European vegoils: Palm oil down on demand woes - RTRS
ROTTERDAM, Nov 22 (Reuters) - Palm oil eased further on Thursday on the European vegetable oil market on worries over demand in thin trade due to the absence of Chicago markets, which were closed for the Thanksgiving Day holiday.
“Speculators continued to cut long positions on worries over demand for palm oil following recent disappointing export data and concerns over the growth of the global economy,” one broker said.
Palm oil was offered between $2.50 and $12.50 a tonne down from Wednesday after Malaysian palm oil futures closed between 23 and 40 ringgit per tonne down on concerns over a slowdown in demand and chances that already record high palm oil stocks will grow further.
Jan delivery RBD palm olein changed hands at $820 a tonne fob Malaysia, Jan/March traded $7.50 down from Wednesday between $825 and $820, April/June fetched between $855 and $845, down $5 and July/Sept traded at $862.50. Crude palm oil traded at $845 a tonne cif Rotterdam for Jan/March and April/June changed hands at $870 cif. Liquid oils – soyoil, rapeoil and sunoil – were offered hardly changed from Wednesday due to the absence of a direction from Chicago markets and a lack of participation with many players visiting the annual Grofor trade dinner in Hamburg. No business was seen. Lauric oils were offered between $10 and $25 per tonne down from Wednesday in sympathy with weakness in rival palm oil with buyers showing little interest and no deals were reported.
Posted by MW Chong at 11:36 AM