Tuesday, March 8, 2011

20110308 1826 FCPO EOD Daily Chart Study.

FCPO closed : 3584, changed : -111 points, volume : higher.
Bollinger band reading : side way range bound downside biased.
MACD Histrogram : turned lower, seller giving another last try.
Support : 3550, 3500, 3470, 3450 level.
Resistance : 3620, 3650, 3700, 3720 level.
Comment :
FCPO closed recorded severe fall after 5 days of gain with better volume traded as crude oil price and soy oil moving lower after recent climb and news on better soy bean crop prospect.
Daily chart formed a down bar candle resume downward movement after tested middle Bollinger band resistance level after market opened gap down and fall lower to closed near the low of the day.
Technical reading wise, market is likely to trade side way range bound downside biased possibly testing lower support level with MACD indicator unable to do a cross up.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110308 1813 FKLI EOD Daily Chart Study.

FKLI closed : 1519.5 changed : -0.5 point,  volume : higher.
Bollinger band reading : side way range bound.
MACD Histrogram : rising, buyer taking small exposure.
Support : 1515, 1500, 1485 level.
Resistance : 1530, 1540, 1550, 1580 level.
Comment :
FKLI closed 1 tick lower with higher volume participation doing about 2 points premium compare to cash market while regional market ended higher despite overnight Dow Jones market negative close.
Daily chart formed another up doji bar candle with longer upper shadow after market opened gap down, tested support and resistance level and closed almost unchanged positioned in between middle and upper Bollinger band level with the bandwidth turning inwards.
Chart reading, wise, market is likely to move side way range bound possibly testing higher resistance level as buyer seems little more aggressive to stay on.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110308 1017 Palm Oil & Biofuels Related News.

Reuters News:

About 100,000 tonnes of palm oil will be channeled towards the Malaysian biodiesel mandate by end 2011 - Industry Sources

Malaysian government to subsidise palm oil based biofuel at 4 sen to 6 sen per litre at the pump - Industry Sources

Malaysia on track to implement palm oil based biofuel mandate in stages from June - Industry Sources

20100308 0959 Local & Global Economic Related News.

Malaysia: External reserves increased slightly in the second half of February 11 to RM338.6b (USD109.8b) as at 28 February 11 from RM338.0b (USD109.6b) on 15 February 11. The latest reserve amount is equivalent to 8.1 months of retained imports and 4.3 times short-term external debt. (Source: Bank Negara)   

Greece: Debt downgrade by Moody's sends default risk to record. The cost of insuring Greek debt against default rose to a record after Moody's Investors Service cut the country's credit rating by three notches. The Finance Ministry in Athens called the move, which sent its rating to B1 from Ba1, "completely unjustified." Moody's said lagging tax collection and "implementation risks" would make it more difficult to reach budget-cutting targets in a EUR 110b (USD 154b) bailout. (Source: Bloomberg)

S. Korea: Targets wider Asia bond sales to cut crisis risk. "We would like to broaden our bond buyers overseas so that we can avoid a financial crisis caused by the sudden flight by a few," Woo Hae Young, director of the Government Bond Policy Division at the Ministry of Strategy and Finance, said an interview at his office in Gwacheon on March 4. "We're looking to Asia, especially China, Hong Kong, Singapore, Malaysia, and Thailand, for long-term investors." (Source: Bloomberg)

Philippines: Reported a smaller budget deficit last year than the government forecast as spending missed targets. The shortfall was a record PHP314.4b (USD7.3b), compared with a forecast of PHP325b, the government said in an emailed statement. Spending was PHP1.52tr, lower than a goal of PHP1.62tr, while revenue was PHP1.21tr, less than a target of PHP1.29tr. The deficit was PHP44.6b in December. (Source: Bloomberg)

Vietnam: Commercial lenders to limit their loans made in foreign currencies as policy makers seek to narrow the nation's trade deficit and stabilize its exchange rate, a central bank official said. Priority for the loans will be given to export companies that have foreign-currency resources to repay banks, and importers of essential goods that aren't produced domestically, the official said on condition of anonymity because he isn't authorized to speak to the media. (Source: Bloomberg)

Australia: Job advertisements rose in February for a 10th straight month, as Queensland state cleaned up from flooding in January. Jobs advertised in newspapers and on the Internet advanced 1.2% MoM from January, when they increased a revised 3% MoM, according to an Australia & New Zealand Banking Group Ltd. report released in Melbourne. Queensland recorded a 30.5% MoM surge in newspaper job advertisements, it said. (Source: Bloomberg)    

Australia: Construction contracted for ninth month
Australia’s building industry contracted in February for a ninth straight month as higher borrowing costs weighed on housing construction. The construction performance index was 44.6 last month from 40.2 in January. A reading below 50 indicates the industry is shrinking. A gauge of house building declined 3.1 points to 34.2 in February. The measure of new orders climbed 2.3 points to 43.2, engineering work rose 13.3 points to 52 and commercial work gained 3.8 points to 42.4. (Bloomberg)

UK: Manufacturers plan to raise prices, fueling inflation
UK manufacturers plan to raise prices as the cost of oil and other raw materials surge, which may fuel further inflation pressure. The number of companies saying they plan to raise domestic prices exceeded those expecting declines by 39 ppts, up from 16 in the previous three months and the highest since the data were first collected in 2000. The proportion of manufacturers saying they hired workers in the first quarter exceeded those reporting job cuts by 29 ppts while the number of companies reporting that output rose in the three months through March exceeded those reporting decreases by 25ppts. (Bloomberg)

US: Consumer credit increased in January
US consumer borrowing increased for a fourth straight month in January, led by a gain in non- revolving loans such as those for automobiles and education. The USD5.01bn rise in credit followed a revised USD4.09bn gain in December that was less than the previous estimate. Revolving debt, which includes credit cards, decreased USD4.25bn in January, while non-revolving debt, including loans for cars and mobile homes, rose USD9.26bn. (Bloomberg)

20110308 0958 Malaysia Corporate Related News.

QSR: Sets up Cambodian unit. QSR Brands Bhd has incorporated a company in Cambodia, Integrated Poultry Industry (Kampuchea) Pte Ltd, for the purpose of operating a broiler and processing production in Phnom Penh. (Source: Bursa Malaysia)

FDI: Invest KL targets 10 MNCs annually. Invest KL, expected to be launched by end-April, is targeting to attract at least 10 multinational companies (MNCs) annually to invest in Kuala Lumpur and the Klang Valley. Invest KL had attracted two MNCs, Schlumberger and Vale, so far. (Source: The Star)

Transportation: Feasibility studies on high-speed KL-Singapore rail. The Government is currently undertaking feasibility studies on a high-speed rail connecting Kuala Lumpur and Singapore. The feasibility studies would take about eight weeks to complete. (Source: The Star)

Telco: P1 part of SK Telecom's larger plans. While investors may have turned sceptical towards loss-making WiMAX player Packet One Networks Sdn Bhd (P1), its new strategic partner SK Telecom (SKT) believes there is much value in P1's wireless business as a launchpad for SKT's aspiration to expand regionally in Southeast Asia. SKT said that either P1 or Green Packet could become part of SKT's expansion plans in Southeast Asia later. (Source: The Edge Financial Daily)

Nestle Malaysia budgets up to RM120m for capex
Nestle Malaysia has budgeted RM100m to RM120m to expand its capacity this year. Managing Director Peter Vogt claimed that majority of the sum is to be invested in increasing the capacity and innovation. He said the increase in capacity at the company’s factory allows the group to expand its export market, namely Indonesia and the Philippines, as well as the domestic market. The budget for capacity expansion is in line with the group’s priority on having organic growth, instead of growing via mergers and acquisitions. (Financial Daily)

Multi Sports to sponsor TDR programme
Multi Sports Holdings (MPHB) is proposing to sponsor a depository receipt programme in Taiwan which entails the issuance of Taiwan depository receipts (TDR) representing up to 67.5m new shares of 5 US cents (15 sen) each in the company. Such a move will pave the way for Multi Sports to have dual listing.(StarBiz)

Allianz eyes 10% growth Allianz General Insurance Co (M) Bhd (AGIC) wants to grow its business by 10% this year, riding on the bullish economy that is expected to spur construction activities and consumer spending power. However, its chief executive officer Zakri Mohd Khir said although the 10% target is achievable, the insurer believes that growth would be between 6% and 8%. (BT)

DRB-HICOM unit wins RM7.5bn defense contract
DRB-HICOM’s wholly-owned subsidiary, DRB-Hicom Defence Technologies SB (Deftech), has received a contract worth RM7.55bn from the Malaysian Government to supply armored-wheeled vehicles (AWV). DRBHICOM told Bursa Malaysia yesterday that Deftech had accepted a letter of award from the Government to design, develop, manufacture, commission, supply and deliver 257 units of 12 variants of the 8x8 AWVs. The contract is for a period of seven years beginning 2011. (StarBiz)

Lion Group blames Vinashin woes for Viet project failure
The Lion Group has blamed problems at Vietnam's scandal-hit shipbuilder Vinashin for the failure of a multibillion- dollar joint venture. The USD9.8bn (RM29.69bn) project by state-owned Vietnam Shipbuilding Industry Group (Vinashin) and Lion would have included a steel mill, power plants and a sea port in the southern Vietnamese province of Ninh Thuan. Vietnamese officials said last month that the project's investment licence had been revoked because investors did not fulfil their commitments. "The Lion Group wishes to clarify that the lack of progress is due to the financial and management issues affecting Vinashin which has not been able to respond on the continuity of the project," the firm said in a statement. (BT)

Sime Darby eyes French region for plant
Sime Darby Plantation, the world's largest listed plantation company, has identified the Languedoc-Roussillon region in France as a potential location to set up its multi-feedstock vegetable oil processing plant. The move will be part of the group's strategy to expand into key areas around the world where there is a growing demand for edible oils such as in southern Europe and north Africa. “The proposed plant, to be located in the coastal town of Port-la-Nouvelle, will also present an unprecedented opportunity for economic development and new employment,” it said in a statement yesterday. (StarBiz)

Thai AirAsia seeks USD200m from IPO
The Thai unit of AirAsia, Asia's largest budget carrier by fleet size, said yesterday it planned to raise up to USD200m from an initial public offering (IPO) in Bangkok in the fourth quarter. “We should raise US$150m to USD200m from the IPO and the proceeds will be used as cash reserve and to buy aircraft,” Thai AirAsia chief executive Tassapon Bijleveld told reporters. (StarBiz)

Sunway unit bags RM74.1m contract
Sunway Holdings’ unit Sunway Construction SB (SunCon) has secured a contract worth RM74.1m from Bio- XCell SB to undertake the engineering, procurement, construction and commissioning of a central utilities facility at Biotechnological Park Bio-XCell in Nusajaya, Johor. “The proposed project is targeted to be completed by 25 May, 2012. (StarBiz)

Golden Frontier selling Vietnam unit
Main-board listed Golden Frontier is selling its corrugated packaging business in Vietnam and will use the proceeds to embark on two new ventures in Malaysia. It planned to set up a paper mill in Sungai Bakap, Penang and a corrugated packaging facility in the Klang Valley which would eventually cost a total RM550m, said executive chairman and managing director Datuk Khor Teng How. Speaking after Golden Frontier's AGM yesterday, Khor said the company was selling its wholly-owned subsidiary Alcamex Packaging (Vietnam) Joint Stock Co to Siam Cement Group for USD21m (RM63m) cash. Alcamex owns three plants in Vietnam two in Ho Chi Minh City and one in Hanoi. (StarBiz)

20110308 0954 Global Market Related News.

U.N. Says World Vulnerable To Food Crises (Source: CME)
The world has become increasingly vulnerable to food crises in the wake of the global financial crisis and the commodity boom of 2007-08, the United Nations' food body said. In its flagship report, the Food and Agriculture Organization said while world food prices fell after spiking in 2008, they remain elevated and volatile, a situation likely to continue owing to rising production costs, growing demand from biofuels and pressure on supplies from a rapidly-expanding population. "The experience of the food price and financial crises have provided a sharp reminder of the vulnerability of world food security to shocks in the global food system and the world economy," said the report. Some food prices have more than doubled this year after weather problems in key producers curbed the global production of wheat, corn, cotton and sugar.
The FAO's food-price index rose 2.2% on month in February, the eighth-consecutive monthly rise, to the highest level in real and nominal terms since the FAO started monitoring prices in 1990, according to data from the body. Charities warn the rising cost of staple foods could push the number of chronically-hungry people in the world above 1 billion, as happened in 2009. "Millions more people are sliding into poverty as they struggle to afford basic food supplies and more and more are at risk of going hungry," said Oxfam's food-policy adviser Thierry Kesteloot. The FAO report said that with global food consumption outpacing supply, "prices are projected to increase over the next decade and to continue to be at levels, on average, above those of the past decade." World food production, as measured by the FAO's production index, is forecast to have grown 0.8% in 2010 after rising 3.8% in 2008 and 2.6% in 2007, as producers responded to the high prices of the food crisis.
Global food consumption, which has been rising at an average of around 2% a year, was only marginally dented by the recession, the FAO said. Trade in food is expected to have contracted again in 2010 after increasing 4%-6% annually before the financial crisis. "Episodes of high prices are detrimental to food security, and the high uncertainty associated with price volatility affects producer viability and may lead to reduced agricultural investments," said the report. Problems such as climate change are also expected to leave markets more vulnerable to shocks: the number of Asian countries affected by food crises doubled from five a year in 1981-2002 to 10 in 2003-2009, for example. "Since the mid-1980s, the general trend has been towards an increase in the number of countries affected by emergencies," the report said. In the face of such growing pressure, the FAO said governments must boost investment in agriculture.
It highlighted that closing the gender gap in agricultural production by empowering women could potentially boost developing countries' output by 2.5%-4% and feed an extra 100-150 million starving people. "The recent food and financial crises, the uncoordinated policy responses and continuing fears over global food-market turmoil have underscored the need for action by the international community," it said.

China Commerce Minister: Developed Economies Enjoy Edge In Food Market Due To Agricultural Subsidies (Source: CME)
China is studying lowering tariffs to increase imports and will unilaterally cut import tariffs from less-developed countries, Commerce Minister Chen Deming said. Speaking at a briefing during the National People's Congress, the annual meeting of China's legislature, Chen said China attaches great importance to expanding imports from the U.S. and views rebalancing bilateral trade with the world's largest economy as the key to resolving its overall trade surplus.
He added that trade deficits can't be ruled out for "a few months" this year, but China's trade surplus as a share of gross domestic product will likely fall. China's export growth will likely slow, in part due to fluctuating currencies, rising commodities prices, and higher labor costs, Chen said.

UN Agency: 2.7 Mln People In Arab Crisis May Need Food Aid (Source: CME)
An estimated 2.7 million people will need food aid as a result of the political turmoil sweeping the Middle East and North Africa, the United Nations' relief agency said, as it launched an appeal to help refugees from the Libyan crisis. The World Food Program said it is calling for a total of $43.2 million in aid to assist 1.1 million people directly affected by the Libyan crisis, adding that it has staff pre-positioned to enter the country once access is possible. "Libya faces a humanitarian crisis following an unprecedented level of upheaval and violence," it said in its latest crisis update. "The current outlook for the country...is that the humanitarian situation will continue to deteriorate." More than 200,000 mostly migrant workers have fled to bordering countries, including Tunisia and Egypt, in a bid to escape violence in Libya. Humanitarian agencies estimate up to 6,000 people may have died since mid-February following a violent crackdown on rebel groups by forces loyal to Moammar Gadhafi.
Libya's crisis is the latest in a wave of revolutionary unrest sweeping the Arab world which has toppled the long-standing presidents of Tunisia and Egypt and threatened many of the region's autocratic regimes. The WFP said it has already provided food aid for more than 35,000 people near the Egyptian and Tunisian borders and is making preparations to deliver aid for a further 29,000 in the coming days. The U.N. estimates 400,000 people will leave Libya due to the crisis. Still, as violence continues the WFP said the repercussions are likely to escalate. "As the recent political upheavals in Egypt and Tunisia have exacerbated their already weakened social safety net systems, WFP may need to expand assistance to target an estimated 2.7 million people," it said.

U.S. employment rebounds from winter gloom
WASHINGTON, March 4 (Reuters) - U.S. employers hired workers at the fastest pace in nine months in February and the jobless rate slipped to a nearly two-year low of 8.9 percent, showing the economy is finally kicking into a higher gear.
Nonfarm payrolls increased 192,000, the Labour Department said on Friday, partly bouncing back from a weather-depressed January as private employers hired 222,000 workers, the most since April. The gains were broadly in line with expectations.

China targets inflation as fiscal priority
BEIJING, March 7 (Reuters) - China will ensure that big increases in spending on social priorities from public housing to health care do not aggravate inflationary pressures that it has been trying to suppress, the finance minister said on Monday.
What's more, China will use its fiscal policies to boost production of grain, cotton and food as a way of reining in prices, Finance Minister Xie Xuren said at a news conference held during China's annual national parliament session.

S.Korea: economy in recovery, price pressure up
SEOUL, March 7 (Reuters) - Brisk domestic demand and exports have been shoring up the South Korean economy, but stronger raw material prices are raising inflationary pressure, the Finance Ministry said in a report to the parliament on Monday.
The report comes just before the Bank of Korea convenes its monthly rate-setting meeting on Thursday, after it surprised markets by standing pat in February following an unexpected hike by 25 basis points to 2.75 percent in January.

China urges other nations to accept rare earths position
BEIJING, March 7 (Reuters) - Economies that have come to depend on China for rare earths metals should accept that Beijing has real environmental concerns that make curtailing exports necessary, the Chinese Commerce Minister Chen Deming said on Monday.
China produces about 97 percent of the global supply of rare earth minerals used in smartphones, electric car motors and high-tech industrial equipment. Beijing cut export quotas by 40 percent last year, alarming buyers and trading partners.

PRECIOUS-Gold climbs to record as Mideast violence flares
LONDON, March 7 (Reuters) - Gold climbed to a record high above $1,440 an ounce on Monday as the threat of violence spreading in the Middle East and North Africa pushed oil prices to 2-1/2 year highs and burnished the metal's safe-haven appeal.
"There is all sorts to support gold -- high oil prices, low real interest rates, and the fact that there are constant reminders that we still have debt problems in Europe," said Standard Bank analyst Walter de Wet.

FOREX-Euro jumps to 4-mth high vs dlr on ECB rate view
LONDON, March 7 (Reuters) - The euro jumped to a four-month high against the dollar on Monday as expectations of a euro zone interest rate hike next month helped it vault back above $1.40 and investors shrugged off a ratings downgrade of Greece.
"Sentiment is bullish at the moment and we could see a test of the 1.4080/00 area," said Richard Wiltshire, chief foreign exchange dealer at ETX Capital.

Argentina issues permits for delayed grains shipments
BUENOS AIRES, March 5 (Reuters) - Argentina's government said on Saturday it had granted export permits to allow grains shipments delayed at ports after President Cristina Fernandez dissolved the state agency in charge of the multibillion-dollar farm trade last week.
The dissolution of the ONCCA agency, which farm leaders accused of corruption and inefficiency and which was responsible for authorizing export permits, delayed shipments and generated uncertainty among exporters.

Oil at 2-1/2-year high, world stocks retreat
LONDON, March 7 (Reuters) - Crude oil prices jumped to a 2-1/2-year peak as worries about supply disruption increased due to widening clashes in Libya, while world stocks fell on concern sustained high oil prices could hurt growth. "Investors are still nervous. The one thing they hate is uncertainty and the Middle East situation is providing plenty of uncertainty," said Keith Bowman, analyst at Hargreaves Lansdown.

20110308 0953 Soy Oil & Palm Oil Related News.

US soy-product futures close lower with as traders take money off the table amid concerns about the global economy. Broad selling of agricultural commodities also hit soybeans, corn and wheat. Forecasts for beneficial rains in Argentina added pressure, as it is the world's top exporter of soy products. "The weather in Argentina is really quite good right now," according to World Weather. CBOT May soymeal falls $6.30 to $363.40/short ton while CBOT May soyoil loses 0.38c to 59.10c/ pound. (Source: CME)

Palm oil at 2-wk top on biofuel appeal, low stocks
KUALA LUMPUR, March 7 (Reuters) - Malaysian crude palm oil hit two-week highs before paring some gains  as traders hoped stronger energy prices would strengthen the appeal of biodiesel as unrest in Libya threatens to cut crude oil supplies.  "Most likely the government will come out with a solution to balance supply-demand in the country, and probably we could see another interest rate hike -- which is mostly expected by market players," said Zhang Juan Cong, an analyst with Dadi Futures in China's southern city of Hangzhou.

India's Feb oilmeal exports more than double
NEW DELHI, Mar 7 (Reuters) - India's oilmeal exports more than doubled in February from a year ago, the eighth straight monthly rise, on good demand from buyers in Japan, Middle East and China, data from a leading trade body showed.
Oilmeal exports from India, Asia's leading supplier of the animal feed, were 10 percent higher month-on-month at 703,400 tonnes, the Solvent Extractors' Association of India (SEA) said in a statement on Monday.

Argentine crops in mixed shape due to rains-gov't
BUENOS AIRES, March 4 (Reuters) - Argentine 2010/11 soy is in a patchy condition depending on how much rain has fallen, but many crops in the top growing region are developing well, the Agriculture Ministry said on Friday.
Argentina is the world's No. 3 exporter of soybeans and the top supplier of soyoil and meal, but weeks of dryness caused by La Nina earlier this year prompted analysts to lower their estimates for soy this season's output.

Palm oil output rise may help satisfy food demand
JAKARTA/KUALA LUMPUR, March 7 (Reuters) - Strong production of southeast Asian palm oil is the best hope of boosting cooking oil supplies as competitor soyoil gets soaked up to make biofuel, its attraction redoubled by unrest in Libya that has driven crude oil to more than $100 a barrel.
Vegetable oil markets had braced for a fall in palm oil prices in the second half of 2010, on expectations of strong output from top producer Indonesia, as it harvests a bigger acreage, and as No.2 supplier Malaysia improves yields.

Indian vegoil imports to fall on year-association
KUALA LUMPUR, March 7 (Reuters) - Imports of vegetable oils in the world's top buyer India, will fall more than 2 percent in the current marking year to September, due to improving domestic output, an industry official said on Monday.
India's imports of palm oil, soyoil and sunflower oil in last year were 9.2 million tonnes and are seen dropping to 9 million in 2011, B.V. Mehta, executive director of the Solvent Extractors' Association of India, told Reuters.

Malaysian palm stocks to stay low, prices seen up
KUALA LUMPUR, March 7 (Reuters) - Palm oil stocks in Malaysia, the world's No.2 producer, will be tight from February to April, a top industry official said on Monday, potentially fuelling prices and global food inflation. Malaysian Palm Oil Board (MPOB) Chairman Shahrir Samad said stocks in February, March and April are expected to be about 1.3 million tonnes to 1.4 million tonnes, down by up to 8.5 percent from January.

Brazil on brink of new soy boom, easing food fear
SAO PAULO, March 4 (Reuters) - When soy futures hit record highs in 2008, Brazilian farmers were in no position to capitalize on the boom. Crippling debts, wild currency swings and high fertilizer and fuel costs rendered them unwilling or unable to sow more acres.
Today, although prices are almost 20 percent lower, conditions have rarely been better. Farmers, now flush with cash, are preparing the first sustained expansion of the country's soy crop after a half decade of stagnation.

Upside seen in palm oil prices; 2011 purchases flat -CSM
JAKARTA, March 4 (Reuters) -     Volatile palm oil prices have the potential for greater upside during the first half, as uncertainty in comparative vegetable oil yields offsets the risk of speculators liquidating positions, CSM , the world's largest bakery supplier, said on Friday.
The benchmark May 2011 crude palm oil contract  on   Bursa Malaysia Derivatives touched 3,967 ringgit ($1,308) on Feb. 10, a peak not seen since March 2008.