20120221 1815 FCPO EOD Daily Chart Study.

FCPO closed : 3268, changed : +23 points, volume : higher.
Bollinger band reading : upside biased with possible pullback correction.
MACD Histrogram : rising, buyer in control.
Support : 3250, 3200, 3150, 3100 level.
Resistance : 3270, 3300, 3350, 3420 level.
Comment :
FCPO closed recorded gains with better volume transacted. Soy oil price currently trading higher after yesterday non trading day and last Friday ended higher while crude oil price continue to break higher.
Improved export data reported yesterday lifted FCPO price higher plus broad commodities price advance higher after Greece obtained 2nd bailout news.
Technical reading adjusted to suggesting an upside biased market development with possible pullback correction.
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.

20120221 1735 FKLI EOD Daily Chart Study.

FKLI closed : 1568.5, changed : +6.5 points, volume : lower.
Bollinger band reading : upside biased.
MACD Histrogram : turned upward, buyer in charge.
Support : 1565, 1550, 1540, 1530 level.
Resistance : 1570, 1580, 1590, 1600 level.
Comment :
FKLI rallied higher recorded gain with slower volume changed hand doing 4.5 points premium compare to cash market that soared little higher. Overnight U.S. markets closed for President day and today Asia markets traded mostly higher while European markets swing between gains and losses.
Global market trade mostly higher after news on Greece gets 2nd bailout and China central bank lowered bank reserve ratio.
Chart study resumed to suggesting an 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.

20120221 1705 Regional Markets EOD Daily Chart Study.

 DJIA chart reading :  upside biased.

 Hang Seng chart reading : pullback correction upside biased.

KLCI chart reading :  pullback correction upside biased.

20120221 1617 Global Market & Commodities Related News.

Euro jumps, stocks pare losses on Greek deal
SINGAPORE, Feb 21 (Reuters) - The euro jumped and Asian stocks pared losses after euro zone policy makers agreed to a second bailout package for Greece in marathon talks that went deep into the Brussels night.
"The Greece bailout agreement has already been priced in by the market," said Yoshihiko Tabei, chief analyst of capital markets at Kazaka Securities, before the announcement.

FOREX-Euro gains after Greece bailout deal
TOKYO, Feb 21 (Reuters) - The euro jumped back to positive territory and broke above key resistance from its 90-day moving average after euro zone finance ministers clinched a second bailout deal for Greece on Tuesday.
The bailout will involve financing of 130 billion euros and aims to cut Greece's debt to 121 percent of GDP by 2020, EU officials said.

US grains steady; export demand, Greece hopes support
SYDNEY, Feb 21 (Reuters) - U.S. grains held on to gains as trading resumed after a long weekend, with stronger export demand and South American weather concerns expected to support prices.
"Expectations out of Europe will be generally commodities supportive. The key is whether it will come good," said independent grains analyst Jonathan Barratt.

Rains lift hopes for Ivorian cocoa midcrop
ABIDJAN, Feb 20 (Reuters) - Rains picked up in Ivory Coast's main cocoa growing regions last week, lifting hopes for healthier production volumes during the April-to-September midcrop, farmers and analysts said on Monday.
Dry, windy weather has crimped output so far this season, with volumes already down about 8 percent from last year, according to exporter estimates.

Ivorian cocoa output seen drying up
ABIDJAN, Feb 20 (Reuters) - Cocoa output from top supplier Ivory Coast is running about 8 percent below last year and could lag further in coming weeks after a stretch of dry, windy weather hindered growing operations, exporters said on Monday.
Some 932,000 tonnes of cocoa have reached Ivorian docks for export by Feb. 19 since the season started in October, compared with 1,012,140 a year ago. About 15,000 tonnes of that arrived in the most recent week, exporters said.

ISO raises 2011/12 global sugar surplus forecast
LONDON, Feb 20 (Reuters) - The International Sugar Organization on Monday increased its forecast for a projected global sugar surplus in 2011/12 to 5.17 million tonnes, up from a forecast of 4.46 million issued in its previous quarterly update.
World production in 2011/12 was seen at a record 173.00 million tonnes, up 4.9 percent from the previous season, with consumption climbing 2.3 percent to 167.83 million, the ISO said in a quarterly market outlook.

Rain ruins part of Vietnam's 2012/2013 coffee-Vicofa
HANOI, Feb 20 (Reuters) - Rain and rough handling have ruined some coffee flowers in Vietnam, which could lead to a drop in the yields of the next crop, a Vietnamese industry executive said on Monday.
Vietnam, the world's second-largest coffee producer after Brazil, has ended harvesting the 2011/12 crop in January.

Grain farms in China's northeast may see drought - ministry
BEIJING, Feb 20 (Reuters) - China's agriculture ministry has urged the authorities in the country's major corn and soybean growing northeast to be fully prepared for a possible drought in the spring planting period, which may delay or hurt crops.
"Since autumn, rainfall in the northeast has been 30 to 80 percent less (than in normal years), which has reduced water supplies to rivers and led to a shortfall of water storage in reservoirs," the ministry said during a meeting with local government officials.

Brent hovers near $120, Iran supply cuts support
SINGAPORE, Feb 21 (Reuters) - Brent crude futures held steady near $120 a barrel as the euro zone approved a second bailout package for debt-laden Greece, while a cut in Iranian oil supply to China and Europe supported prices.
"Scepticism remains as to whether Greek politicians will be able to deliver the reforms at the required pace, especially after the Greek elections in April," ANZ bank analysts said in a note.

Aluminium output down, but not in China
--Andy Home is a Reuters columnist. The opinions expressed are his own--
LONDON, Feb 20 (Reuters) - Cost curve pressure and resulting producer cutbacks have emerged as the key twin themes for the aluminium market this year.  
There is an analysts' consensus that whatever the state of metals demand this year, aluminium's price downside is limited by supply-side fragility.  

Japan Jan copper cable shipments down 1.2 pct yr/yr
TOKYO, Feb 20 (Reuters) - Japanese copper wire and cable shipments fell 1.2 percent in January from a year earlier to an estimated 56,000 tonnes, hurt by a plunge in demand from utilities and lacklustre orders from electronic parts makers and other exporters.
The January level also marked a 4.7 percent slide from 58,711 tonnes in December, data from the Japanese Electric Wire and Cable Makers' Association showed.

China daily steel output up 1.9 pct in early Feb -CISA
SHANGHAI, Feb 20 (Reuters) - China's daily crude steel output rose 1.9 percent in the first 10 days of February, data from the China Iron & Steel Association (CISA) showed on Monday, as traders replenished their stockpiles following the lunar year holiday.
Daily runs reached 1.705 million tonnes over Feb. 1-10, up from 1.673 million tonnes during the Jan. 21-31 period.  

Japan Jan crude steel output falls most in 27 mths
TOKYO, Feb 20 (Reuters) - Japan's crude steel output fell the most in more than two years in January as exports plunged, more than offsetting a recovery in domestic manufacturing output.  
Crude steel output fell 10.6 percent to 8.63 million tonnes, the biggest fall in the 27 months since October 2009, amid the financial crisis sparked by the Lehman collapse, data from the Japan Iron and Steel Federation showed.

Copper rises with euro on Greece relief
SINGAPORE, Feb 21 (Reuters) - London copper futures rose 1 percent after debt-laden Greece struck a deal for a second bailout package to avert a default next month, fuelling appetite for riskier assets.
"It's a relief for markets, broadly speaking, but it doesn't mean that this is the end of the line," said Thomas Lam, economist at DMG & Partners Securities.

China daily steel output up 1.9 pct in early Feb -CISA
SHANGHAI, Feb 20 (Reuters) - China's daily crude steel output rose 1.9 percent in the first 10 days of February, data from the China Iron & Steel Association (CISA) showed on Monday, as traders replenished their stockpiles following the lunar year holiday.
Daily runs reached 1.705 million tonnes over Feb. 1-10, up from 1.673 million tonnes during the Jan. 21-31 period.

METALS-Copper rises with euro on Greece relief
SINGAPORE, Feb 21 (Reuters) - London copper futures rose 1 percent on Tuesday after debt-laden Greece struck a deal for a second bailout package to avert a default next month, fuelling appetite for riskier assets.
The deal involves 130 billion euros in new financing for Greece and for Athens to work to cut its debt to 121 percent of GDP by 2020, two EU officials said. The euro reversed early losses on the news to trade higher against the dollar while Asian stocks cut losses.

Gold edges up after EU approves Greece bailout
SINGAPORE, Feb 21 (Reuters) - Spot gold rose slightly as the dollar weakened after euro zone finance ministers delivered on expectations and sealed a deal for a second bailout for debt-laden Greece.
"Gold may remain in a consolidation phase in the near term, as it is lacking a catalyst," said Hou Xinqiang, an analyst at Jinrui Futures in the southern Chinese city of Shenzhen.

PRECIOUS-Gold edges up after EU approves Greece bailout
SINGAPORE, Feb 21 (Reuters) - Spot gold rose slightly on Tuesday as the dollar weakened after euro zone finance ministers delivered on expectations and sealed a deal for a second bailout for debt-laden Greece.
The decision will help Athens resolve its immediate payment needs, but Greece still faces bleak financial and economic outlook in coming years.

20120221 1136 Global Market & Commodities Related News.

GLOBAL MARKETS-Stocks, euro ease as markets await Greek deal
SINGAPORE, Feb 21 (Reuters) - Asian stocks and the euro faltered on Tuesday, as a rally that had been driven by expectations of a second bailout package for Greece ran out of steam with a deal still not quite sealed.
"Share markets around the world have rallied recently, driven in part by hopes that Greece will clinch a bailout deal," said Yumi Nishimura, a senior market economist at Daiwa Securities in Tokyo, speaking as talks dragged on in Brussels.

COMMODITIES-Oil, copper jump on China easing, Greece hopes
SINGAPORE, Feb 20 (Reuters) - Oil rose to multi-month highs and copper rebounded on Monday, as investors flocked to riskier assets after China's first bank reserve requirement cut for this year spurred hopes for improved liquidity in the world's top importer of most commodities.
"We're expecting another 50-basis point cut in RRR in the second quarter and we think credit conditions will be better this year compared to last year," said Siew Huay, an economist at DMG & Partners Securities.

Oil rises to 8-month high on Iran, China moves
LONDON, Feb 20 (Reuters) - Oil prices climbed to their highest in more than eight months on Monday, pushing Brent crude above $120 a barrel as Iran cut off oil exports to Britain and France while economic developments in Asia and Europe lifted riskier assets.
"Banning the tiny quantities of exports to the UK and France involves very little risk for Iran - indeed quite the opposite, it catches the headlines and leads to a higher global oil price, which is something Iran is very keen to encourage," said Caroline Bain, analyst at the Economist Intelligence Unit.

IEA says EU could live with abrupt Iran oil halt
LONDON, Feb 20 (Reuters) - The European Union could cope with an abrupt halt by Iran of oil exports to the region because buyers of Iranian oil are already adjusting to the EU's forthcoming ban on Iranian shipments, an International Energy Agency official said on Monday.
Oil prices  rose on Monday to an eight-month high above $121 a barrel as Iran said it halted exports to British and French companies ahead of a European Union embargo starting on July 1.

Euro Coal-S.African prices rise on short-covering
LONDON, Feb 20 (Reuters) - Prompt South African physical coal prices rose by around 50 cents on Monday as market participants tried to cover short positions taken at the end of last year amid tight supply for March in particular, traders said.
"This is a temporary imbalance and not a good barometer of the market, it's just the front month and is a short-term squeeze," one European trader said.

Japan says no decision yet on Iran oil import cuts
TOKYO, Feb 21 (Reuters) - Japan's trade and foreign ministers said on Tuesday they haven't reached an agreement yet on how much Tokyo will cut Iranian crude imports to win waivers from U.S. sanctions designed to starve Iran of oil revenue.
Japan is likely to reduce imports of crude oil from Iran by at least 11 percent per year, the Yomiuri newspaper said earlier on Tuesday, to win an exemption from sanctions that could shut Japanese banks out of the United States if they facilitate trade in Iranian crude.

20120221 1022 Palm Oil Related News.

ITS CPO export down 2% to 783,112 tonnes for the period of 1~20 Feb 2012.
SGS CPO export down 0.6% to 777,728 tonnes for the period of 1~20 Feb 2012.


There is a target for biodiesel use to go nationwide by 2014, said Plantation Industries and Commodities Minister Tan Sri Bernard Dompok. The implementation could not be made sooner because there were not enough blending facilities for the alternative fuel. The ministry was studying ways to reduce the amount of regular diesel in biodiesel by increasing the use of palm methylester. “We can increase the use of palm methylester in biodiesel by 10%, 30% or 50% in the future after conducting research,” he said. He also said that the government had no intention on increasing the price of B5, which sold at RM1.80 per litre currently. (The Star)

Crude palm oil (CPO) futures price hit RM3,260 per tonne, the highest in more than eight months but finished short of the intraday high buoyed by higher soy bean prices. China had reportedly purchased a record amount of oilseed from the United States. (StarBiz)

20120221 1003 Global Economic Related News.

The leading index (LI) increased 0.4% mom in Dec 2011 (-1.5% mom in Nov). The coincident index grew by 0.2% mom (0.5% mom in Nov) while the lagging index posted a 0.2% mom growth (0.6% mom in Nov). The level of diffusion index for LI remains above 50% indicates that the economy will continue to expand at a slower pace in the near term. (Department of Statistics)

Thailand: GDP shrinks 9% amid floods in fourth quarter, almost twice estimates
Thailand’s economy shrank more than economists estimated as the worst floods in almost 70 years disrupted output by manufacturers from Western Digital Corp. to Honda Motor Co., putting pressure on policy makers to aid growth. Gross domestic product declined 9% in the three months through December from a year earlier, after climbing a revised 3.7% the previous quarter, the National Economic and Social Development Board said in Bangkok yesterday. The median of 14 estimates in a Bloomberg News survey was for a 5% drop. The economy grew 0.1% in 2011. (Bloomberg)

Thailand’s Board of Investment (BOI) revealed that foreign direct investment in Jan increased by 60% yoy to stand at THB25bn, with the four most popular industries being metal, machinery and transportation; electronic and electrical appliances; chemical, paper and plastics; and infrastructure. (Thai Financial Post)

Thailand’s Commerce Ministry will press on with its rice-pledging scheme despite warnings on the severe export competition and the huge stockpiles it will have to handle, as it believes the strategy will drive up domestic and international prices. (The Nation)

Thailand’s National Economic and Social Development Board raised its 2012 growth forecast to 5.5-6.5% from the previous 4.5-5.5%, in line with Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong’s firm belief that the economy would expand by as much as 7% this year. NESDB also expects inflation to increase by 3.5-4% from 3.8% last year, due to high food and oil prices. (The Nation)

Japan: Trade deficit widens to record as exports slump
Japan posted a record trade deficit in January as the yen’s strength and weaker global demand eroded manufacturers’ profits and slowed the nation’s recovery from last year’s earthquake and tsunami. The gap widened to JPY1.48trn (USD19bn) and shipments dropped 9.3% from a year earlier as energy imports surged, a Ministry of Finance reported in Tokyo yesterday. The median estimate of 28 economists surveyed by Bloomberg News was for a shortfall of JPY1.46trn. The drag from trade risks countering the boost from reconstruction work that will drive a return to growth this quarter after the economy shrank in the final three months of last year. (Bloomberg)

Japan: S&P affirms Japan’s AA- credit rating with negative outlook
Standard and Poor’s affirmed Japan’s sovereign-debt rating at AA- while maintaining a negative outlook and warning that a downgrade is likely if medium-term growth prospects weaken. The ranking is supported by an “ample net external asset position, relatively strong financial system, and diversified economy,” S&P said in a statement yesterday, also citing the yen’s role as a “key international reserve currency.” S&P has cut the ratings of European nations including France and Italy this year, along with reducing both the U.S. and Japan last year. (Bloomberg)

Japan’s revised leading economic indicator rose 0.3% mom to stand at 94.0 in Dec (93.7 in Nov), according to the Cabinet Office. (Bloomberg)

Chinese senior leaders agreed to continue proactive fiscal policies and prudent monetary policies in 2012, in a statement issued after a meeting held Monday to discuss a draft report submitted by the central government to China's top legislature's annual session scheduled for next month. (Xinhua)

China's central bank and financial institutions bought a net Rmb140.9bn (US$22.4bn) of foreign exchange in Jan compared with net sales of Rmb100.3bn in Dec. (WSJ)

The Bank of Korea named a new member of its policy board, marking the beginning of an overhaul of its rate-setting committee that will see four members of the seven-person policy board replaced in a scheduled overhaul. The central bank will retain its governor, Kim Choong-soo. (WSJ)

By restructuring and privatising, Vietnam will cut the number of state-owned enterprises to 692 after 2015, and to 217 by 2020, from 1,309 now, the government-run enterprise renovation department said. (Reuters)

Singapore firms continued to expand strongly overseas, especially into emerging markets, according to International Enterprise Singapore. Local companies directly invested S$31.7bn overseas in 2011, a 9.7% increase over 2010. (ST)

EU: Greece nears second aid package as default risk spooks Europe
European governments moved toward a second rescue of Greece, calculating that the EUR130bn (USD172bn) cost of a fresh bailout is a price worth paying to prevent a default that could shatter the euro area. Finance ministers haggled into the night in Brussels over the terms of new loans to Greece and a possible contribution by central banks. They also bartered with bank representatives over a bond exchange meant to stave off the immediate threat of a Greek bankruptcy next month. (Bloomberg)

Top European banks, responding to new regulations and wary of lending, are stashing increasingly large sums of money at central banks around the world in a collective flight to safety. The eight giant European banks that have disclosed their annual results in recent weeks reported holding a total of about US$816bn in cash and deposits at central banks as of 31 Dec. That is up 50% yoy from US$543bn. (WSJ)

Eurozone chiefs fought to close a deal for a new Athens bailout as Greek Prime Minister Lucas Papademos sought improved terms on a key write-down of Greece's debt in a last-minute meeting with banks. All sides expressed confidence that an agreement would be found to greenlight a €230bn financial lifeline, in exchange for strict surveillance of the Athens government over coming years. "Papademos has now gone in" to talks with creditor banks, one eurozone governmental source told AFP at around 1930 GMT. (AFP)

Greece is "no threat to the world economy," European Central Bank executive board member Joerg Asmussen said. "Nevertheless, other countries expect us to find a solution. But by the G20 meeting at the end of the week, we'll be a great deal further" towards one, he said with confidence. (AFP)

US Treasury Secretary Timothy Geithner said the US would encourage the International Monetary Fund to support an agreement on Greek economic reforms that had been agreed to by Greek leaders. "This is a very strong and very difficult package of reforms, deserving of support of the international community and the IMF," Geithner said. "The United States will encourage the IMF to support this agreement." (Reuters)

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


Singapore: Government increases aid to poor, boosts wages of older workers
Singapore said it will increase aid to its poorest citizens and boost wages of older workers as the government seeks to defray rising living costs and reduce dependency on foreign labour. The government will cut the proportion of overseas workers that companies can hire and may consider increasing levies of foreign workers further, Finance Minister Tharman Shanmugaratnam said in his budget speech in Parliament. Employers will be partly reimbursed for hiring older workers, and low-income and elderly households will receive cash and rebates yearly to limit the impact of the goods and services tax. (Bloomberg)

China: Government cuts bank reserve ratios a second time as exports tumble
China cut the amount of cash that banks must set aside as reserves for the second time in three months to spur lending as Europe’s debt crisis curbs exports and the housing market cools. Reserve ratios will fall 50 bpts, effective 24 Feb, the People’s Bank of China said on its website. The level for the nation’s largest lenders will decline to 20.5%, based on previous statements. China follows Japan in expanding monetary easing even as global equity markets are buoyed by signs of strength in the US economy and optimism that Europe’s fiscal crisis will be contained. (Bloomberg)

Japan: Japan’s Finance Minister says Japan and China will help Europe solve crisis via IMF
Japanese Finance Minister Jun Azumi said his nation and China will work together to help Europe solve its debt crisis through the International Monetary Fund. Europe needs a bigger so-called firewall of added funding to contain the crisis, even as Greece shows some improvement in solving its financial woes, Azumi told reporters in Beijing after meeting Chinese Vice Premier Wang Qishan. Azumi also said he asked China to make its currency more flexible. The IMF proposed last month to boost its lending funds by as much as USD500bn to insulate the global economy against any deterioration of Europe’s sovereign crisis. (Bloomberg)

UK: Cameron faces Labour call for UK tax stimulus in March budget
UK Prime Minister David Cameron faced opposition calls to cut sales tax and abandon his health service revamp as scrutiny of the coalition government’s deficit-cutting policy intensified before next month’s budget. The attack on Cameron’s deficit strategy comes a day before he meets doctors to rebuild momentum in a program to streamline health spending, which former Labour Health Secretary John Reid called on him to scrap. That gathering coincides with an end to Parliament’s recess as focus shifts toward the contents of Chancellor of the Exchequer George Osborne’s March 21 budget.(Bloomberg)

EU: EU Ministers circle In on Greek rescue as crisis disputes linger
European officials attempting to fend off the euro area’s first sovereign default will try to settle remaining disputes today as they close in on a EUR130bn (USD170bn) Greek bailout. Finance ministers meet in Brussels at 3:30pm, joining Greece’s prime minister, Lucas Papademos, who arrived on the eve of the gathering. Their talks on his country’s second bailout in two years will aim to reconcile demands made on Greek leaders, a debt swap among private creditors, the role of the European Central Bank and concerns the measures won’t bear fruit. (Bloomberg)

EU: Greece identifies USD427m in budget cuts for bailout
Prime Minister Lucas Papademos said Greece found all the extra cuts needed to lower spending by EUR325m (USD427m million) to secure a bailout aimed at averting the region’s first sovereign default. The government identified “a series of additional measures amounting to EUR125m in order to complete the package of budget cuts worth EUR325m according to an e-mailed transcript. Finance ministers from all 17 euro-area countries meet in Brussels tomorrow as governments close in on a deal to unlock a 130 billion-euro aid package for Greece, the second such international bailout of the country in two years. (Bloomberg)

US: Obama’s re-election chances rise with improving economy
The economy is looking better to the American public and with it President Barack Obama’s re-election prospects. Claims for jobless benefits unexpectedly dropped last week to the lowest level in almost four years, providing fresh evidence the job market is on the mend. The Bloomberg Consumer Comfort Index climbed for a fourth straight week to reach the highest level in a year. Sentiment is rising even among those who have yet to benefit from the recovery, as payrolls expand and the unemployment rate drops. Jobless Americans are the most optimistic since April 2008. (Bloomberg)

20120221 1002 Malaysia Corporate Related News.

New cars sales saw its steepest monthly drop in recent years when the January volume fell by 25% year-on-year. The Malaysian Automotive Association (MAA) said total sales for last month dropped a whopping 13,833 units to 40,948 units, from 54,781 units a year ago. The January figure was also lower than the 47,954 units registered in December last year. The lower volume was blamed on stricter hire-purchase loan processes, short working month due to Chinese New Year holidays and impact of Thailand's flood, among others. (BT)

Daibochi Plastic and Packaging Industry is making inroads into the medical glove and electronic sectors. It expects to record maiden revenue from the new sectors in the current financial year ending December 2012. Daibochi managing director Thomas Lim is optimistic about the group's performance this year. He said the company will continue to target potential customers in Australia, as well as multinational customers in the F&B sector. "We hope to begin supplying flexible packaging to them this year," he said. He also added that Daibochi had made significant progress in the past financial year, in testing and certifying its flexible packaging with local medical gloves and electronics manufacturers abroad. (BT)

Malaysia Airports Holdings (MAHB) is in negotiations with Russia's S7 Airlines to commence flights into Kuala Lumpur. It is understood that the airline will either depart from Novosibirsk or Khaborosk. Tourism Minister Datuk Seri Ng Yen Yen said that this would add to Transaero Airlines flights from Russia which started to ply the Moscow-Kuala Lumpur route once a week from December 30 last year. Transaero will increase its frequency to twice a week from March this year. Ng said that Malaysia hit a record tourist arrival number of 24.7m in 2011, but missed its target of 25m. Both the ministry and Tourism Malaysia have set a very conservative and exact 25m target for 2012, largely attributable to flight cancellations by Malaysia Airlines and AirAsia X. (BT)

UMW Toyota, the country's exclusive distributor for Toyota vehicles, said the Japanese carmaker is mulling the idea of assembling hybrid cars or manufacturing its components in Malaysia. UMW Toyota president Ismet Suki said the plan will depend on the potential market volume and the National Automotive Policy (NAP). (Malaysian Reserve)

Not only has the award of the Electrified Double Tracking Project (EDTP) for the Gemas to Johor Baru link been delayed, it has unintentionally drawn controversy. A press report alluded that there has been a bit of chopping and changing by the authorities here on which party is to be awarded the main job for building the double track. The 200km project costing about RM8bn, is the only portion of the North-South double-track railway project that is still unawarded. The main contractor for the project will be one of three shortlisted Chinese companies, namely, China Railyway Engineering Co, China Railway Construction Co and China Communication Construction Co. All three are subsidiaries of China’s Ministry of Railway. Perhaps the Malaysian government ought to consider having a strong local party to become the project delivery partner (PDP) for the project. This would mitigate risks of delays and cost overruns, and, still fulfill the government-to-government agreement of having a Chinese party as the main contractor. (Star)

RHB Capital has Malaysia's wealthy Chinese community firmly in its sights. And part of its strategy to gain a bigger share of that lucrative market is to merge with OSK Investment Bank to create the country's largest stockbroker. Separately, RHB is also seeking approval to acquire private Indonesian lender, Bank Mestika. (TODAYonline)

Dialog Group has incorporated Pengerang LNG Sdn Bhd and Pengerang Terminals (Two) Sdn Bhd. Pengerang LNG will undertake LNG terminal storage facilities, regasification of LNG into natural gas and handling services while Pengerang Terminals (Two) will cover terminal storage facilities for petroleum and petrochemicals. (BMSB)

UMW Toyota targets to sell 5,000 units of hybrid cars this year bolstered by increasing consumer awareness and ongoing tax incentives for hybrid vehicles. UMW had targeted sales of 1,500 units for the new improved third-generation Prius and 2,500 units for the Prius C this year. (Bernama)

Dataprep Holdings says it has secured a five-year contract to design an information and communication technology (ICT) master plan for a "world-class" ski resort in China. Initially, Dataprep will be paid US$0.23m (RM0.7m) to provide the job for 3rd Valley (Zhangjiakou) Resort Corp (3VRC). 3VRC is developing the integrated resort project which will include a world-class ski resort covering an area of 100 sq km to be built over several years. The deal was executed on Feb 6 via Dataprep's wholly-owned DP International Pte Ltd. Dataprep will design ICT master plan for 3VRC's entire Secret Garden Resorts development in Chongli. It will get a further 6% fee on all contracts awarded for 20 ICT packages of the resort development. "The value of these 20 ICT packages will be determined at a later stage when Request For Proposals are obtained from selected vendors for the best bids," Dataprep said. This is a related party transaction as Lim is a major shareholder and director of VXL Capital Partners Corp Ltd, which has an indirect 44.9% stake in 3VRC. (BT)

Iris Corp Bhd’s wholly-owned subsidiary, Iris Land Sdn Bhd, has entered into a teaming agreement with Kida Maru Holdings Ltd for a housing project in Port Moresby, Papua New Guinea (PNG), worth RM160m. Kida Maru owns 14.75ha of land in Section Granville in Port Moresby with a valid developer’s licence. It will jointly assist Iris Land in the development of the project that includes developing 275 units of houses. (BT)

Consumer electronics distributor Compugates Holdings Bhd plans to diversify into timber business in the Asia Pacific to widen its income base. For a start, the group, which recently ventured into solar power business, is in talks with government agencies in Perak to secure two logging concessions in the state. A source close to the company said the company was planning to secure timber concessions relating to two plots of forestry land, measuring about 85ha each, with timber valued at between RM40-50m in each plot. It is understood that Compugates is in the process of applying for the logging licences. The source said away from home, Compugates was looking for logging concessions in Indonesia and Papua New Guinea, among others. (BT)

Oil and gas (O&G) support services provider Yinson Holdings Bhd will not phase out its current trucking business as it fully supports the company's overall trading business segment. Executive director Lim Chern Yuan said it has about 200 trucks, with 30% of them deployed for the O&G segment while the rest for its in-house cargo. In terms of expansion, Lim said for now the company has no plans to increase its trucking assets, but will outsource if it is required to do so. (Financial Daily)

United Plantations Bhd expects 2012 to be a tougher year than 2011 following the changes in Indonesian export tax which could place Malaysian refineries at a disadvantage. The company was hit by the drop in crude palm oil (CPO) prices, and saw its fourth-quarter net profit decrease almost 11% to RM73.1m from RM81.8m in the previous corresponding quarter. The company expects vegetable oil prices to be further dampened by the continuation of the European debt crisis (Malaysian Reserve).

Cypark Resources Bhd’s share price reached its highest level in six months on anticipation of the launch of its 80ha integrated renewable energy (RE) plant, the first and largest in Southeast Asia, next month. Cypark plans to open another six solar farms across the country to bring its total capacity to 33MW of electricity. (Financial Daily)

Mitrajaya unit bags deals worth RM181m
Mitrajaya Holding’s (MHB) wholly owned unit, Pembinaan Mitrajaya SB (PMSB), yesterday secured three contracts worth RM181.4m. The contracts were awarded by Syarikat Prasarana Negara (SPNB) and Putrajaya Holdings SB. PMSB was appointed as nominated sub-contractor by SPNB for the extension of Kelana Jaya and Ampang light rail transit lines worth RM46.8m and RM55.2m respectively. It is also the main contractor for the development of 560 units of medium-cost public apartments inclusive of common facilities and eight units of shop offices at Zone 12E and 12F, Precinct 11 in Putrajaya for RM79.4m. (BT)

Notion VTec proposes bonus issue, free warrants
Notion VTec which posted net losses of RM4.8m in the 1Q ended 31 Dec 2011, proposed a bonus issue of up to 138.9m new shares on the basis of three new shares for every four shares held. The company also proposed to issue up to 46.3m free warrants (Warrants-B) on the basis of one Warrant-B for every four existing shares held by the shareholders. (Financial Daily) –See accompanying report

MAHB in talks with Russian airline
Malaysia Airports Holdings (MAHB) is in negotiations with Russia's S7 Airlines to commence flights into Kuala Lumpur. It is understood that the airline will either depart from Novosibirsk or Khaborosk. Tourism Minister Datuk Seri Ng Yen Yen, who revealed this at a press conference recently, said that this would add to Transaero Airlines flights from Russia which started to ply the Moscow-Kuala Lumpur route once a week from 30 December last year. Transaero will increase its frequency to twice a week from March this year. (BT)

Nilai Resources gets capital repayment request
Nilai Resources Group has received a letter from its major shareholders to undertake a selective capital repayment exercise. In a filing with Bursa Malaysia, Nilai said its board of directors has received a letter from Akarmas SB and Tan Sri Datuk Dr Gan Kong Seng to undertake a capital repayment exercise pursuant to Section 64 of the Companies Act, 1965. Gan is the executive chairman of Nilai Resources while Akarmas held more than 60m shares, or a 54.8% stake in the company. (StarBiz)

Bursa issues query over high share price and trading volume of Green Ocean
Bursa Malaysia has stopped the trading in Green Ocean Corp Bhd's shares less than half an hour before the market closed due to unusual market activity earlier in the day. Bursa has questioned the ACE Market-listed company over the conspicuous increase in its share price and high trading volume. Its share price soared 13.3% from 22.5 sen to 25.5 sen within the first half of yesterday's trading. It halted trading at 4.34pm yesterday 11.1% higher than a day ago at 25 sen. It was the most actively traded stock with 58.8m shares changing hands. (StarBiz)


Sime Darby close to sealing fruitful South Korean deal
Sime Darby is close to signing a distribution agreement with CJ Cheilingjedang Corp, South Korea’s largest food maker by market value. Business Times understands that talks between both parties are at a very advance stage, and if fruitful, a concrete agreement could be signed by the first week of March. The agreement is to supply Novelin cooking oil to the South Korea market in which Green Ocean Corp has the sole rights to use Malaysian Palm Oil Board’s (MPOB) Novelin technology for a 20-year period. (BT)

TNB not raising stake in Integrax
Tenaga Nasional Bhd does not have any plan to increase its 22% stake in port operator Integrax Bhd, said president and chief executive officer Datuk Seri Che Khalib Mohamad Nor. This clears the air on speculation that TNB, which had some disagreements with Integrax over board-room appointments, had wanted to increase its stake and planned to take the port private.(StarBizWeek)

Gas Malaysia listing deferred to 2Q
MMC Corp expects the proposed listing of its associate, Gas Malaysia, to take place in the second quarter of the year as it seeks to comply with conditions imposed by Securities Commission, the engineering and logistics giant said in a filing to Bursa Malaysia last Friday. (Malaysian Reserve) Please see accompanying report

Mulpha set to launch 2 of its most exclusive projects in 2012
Mulpha international plans to launch two of its most exclusive projects, namely Bangsar Enclave in Bangsar and Bayou Creek East in Johor, with a combined gross development value (GDV) of RM190m in the first quarter of 2012. “The target market for this property are high net worth individuals as the price range for this property is between RM10 million and RM14 million. It has been marketed for both local and overseas market,” its chairman Lee Seng Huang told Malaysian Reserve recently. (Malaysian Reserve)

AMMB’s Indonesian subsidiary gets investment manager license
AMMB holding’s subsidiary PT AMCI Manajeman Investasi Indonesia (AmInvestasi) has received an investment manager licence to operate in Indonesia. AMMB said on Friday the Badan Pengawas Pasar Modal dan Lembaga Keuangan (Indonesia Capital Market and Financial Institutions Supervisory Agency) had issued a licence to AmInvestasi on 14 Feb. AmInvestasi is a 99.99% owned subsidiary of PT AmCapital Indonesia, which in turn is 99% owned by AMMB. (Financial Daily)

K-Euro plans stake hike in concessionaire
Kumpulan Europlus (K-Euro) plans to acquire a 15.8% stake in West Coast Expressway SB (WCESB) from Prominent Xtreme SB for RM5.34m, according to a filing by the former with Bursa Malaysia last Friday. K-Euro currently holds a 64.2% stake in WCESB that is set to build and operate the new RM7.07bn Taiping, Perak to Banting, Selangor highway project. (Malaysian Reserve)

Sarawak Cable ends MoU for transmission lines plan
Sarawak Cable scrapped the plan to work with Sinohydro Corporation (M) SB and KEC International Ltd to develop transmission in Sarawak. The company said on Friday the memorandum of understanding (MoU) had been terminated and the parties would not be submitting the proposal. On 17 Aug 2011, the three parties had signed the MoU to prepare and submit proposals for the project. (Financial Daily)

20120221 0945 Global Market Related News.

Markets buoyed by China easing, Greece hopes
TOKYO, Feb 20(Reuters) - Markets rose across the board as policy easing by China and expectations that Greece will secure a  second bailout buoyed investor appetite for riskier assets, sending U.S. crude up nearly 2 percent and copper nearly 3 percent higher.
"While the cut suggests that policymakers may be mildly concerned over the slowing pace of economic activity, overall, we think the RRR cut will most likely result in an acceleration of economic activity and that China's Q1 growth is likely to surprise us on the upside," said ANZ in a research note.

China’s Stock Index Climbs on Reserve-Ratio Cut; ICBC Advances (Source: Bloomberg)
China’s benchmark stock index rose, extending its longest weekly winning streak since 2010, after the central bank announced a cut in reserve requirements for the first time this year to bolster economic growth. Industrial & Commercial Bank of China Ltd. and Bank of China Ltd. (3988) paced gains for financial stocks after reserve ratios were lowered by a half percentage point. China Vanke Co. led a gauge of real-estate companies to a one-week high after a central bank adviser said the nation needs targeted “fine- tuning” of its property market. China CNR Corp., the nation’s second-biggest train maker, dropped after the regulator approved a plan to sell new shares. “The market will react positively to the reserve-ratio cut,” said Wu Kan, a Shanghai-based fund manager at Dazhong Insurance Co., which oversees $285 million. “The turning point for liquidity has appeared. What we want to see next is if the slowdown in economic growth can be halted after these measures are implemented.”

China acts to crank up credit as lending, economy slow
SHANGHAI/BEIJING, Feb 19 (Reuters) - China's central bank cut the amount of cash banks must hold in reserves on Saturday, boosting lending capacity by an estimated 350-400 billion yuan ($55.6-$63.5 billion) in a bid to crank up credit creation as the world's second-biggest economy faces a fifth successive quarter of slowing growth.
The People's Bank of China (PBOC) is on the course of gentle policy easing to cushion the world's fastest-growing major economy against stiff global headwinds as Europe's debt crisis grinds on, although it has been treading warily.

Emerging-Market Stocks Head for 6-Month High as China Cuts Reserve Ratios (Source: Bloomberg)
Emerging-market stocks rose, with the benchmark index poised to close at a six-month high, as European finance ministers moved toward a second rescue of Greece and after China cut banks’ reserve requirements. The MSCI Emerging Markets Index (MXEF) increased 0.4 percent to 1,066.39 at 12:28 p.m. in New York, which would be the strongest close since Aug. 4. The Shanghai Composite Index (SHCOMP) added 0.3 percent. The Micex (MICEX)rose 0.6 percent in Russia after Iran halted some oil exports to France and the U.K. Mexico’s benchmark added 0.6 percent and Chile’s fell 0.2 percent. Financial stocks were among the biggest gainers in MSCI’s developing-nation index after the People’s Bank of China said it will reduce the amount of cash lenders must set aside by half a percentage point beginning Feb. 24. European leaders are meeting in Brussels today to discuss a 130 billion-euro ($170 billion) Greek rescue package.
“What this reserve requirement cut shows is the commitment of the Chinese authorities toward monetary easing, and that should secure a soft landing for the Chinese economy,” John Lomax, an emerging-markets strategist at HSBC Holdings Plc, said by phone from London. The European meeting raises the “possibility of some kind of Greek deal,” he said.

Japanese Stocks Fall on Signs Market Overbought, Greek Rescue Negotiations (Source: Bloomberg)
Feb. 21 (Bloomberg) --　Japanese stocks retreated from a six-month high as technical indicators signaled the market was overbought and investors awaited the outcome of negotiations by European finance ministers over a bailout for Greece. JFE Holdings Inc. led steelmakers lower after jumping 8.4 percent yesterday. Kyocera Corp. (6971), an electronics maker that gets almost 17 percent of its revenue in Europe, lost 0.6 percent. Kansai Electric Power Co. fell 2.5 percent after halting a nuclear reactor for maintenance. Inpex Corp. (1605), Japan’s biggest energy explorer, led mining companies higher after oil and metal prices increased. The Nikkei 225 Stock Average (NKY) fell 0.2 percent to 9,468.31 as of 9:22 a.m. in Tokyo, and the broader Topix Index dropped 0.1 percent to 818.27. “It will take a few days before overheating of the market cools down,” said Fumiyuki Nakanishi, a strategist at SMBC Friend Securities Co. in Tokyo. “Investors won’t chase higher prices aggressively until that happens.”

FTSE 100 Stocks Post Advance After China Cuts Banks’ Reserve Requirements (Source: Bloomberg)
U.K. stocks rose to a seven-month high as China cut banks’ reserve requirements to spur growth and euro-area finance ministers met to discuss a Greek bailout. Rio Tinto Group and BHP Billiton Ltd. (BHP) advanced more than 2 percent as China’s decision boosted demand for base metals. CSR Plc (CSR), the U.K. maker of chips used in Nokia Oyj mobile phones, jumped 21 percent after reporting a narrower-than-estimated loss. Misys Plc (MSY) soared 6.6 percent after attracting a bid from Vista Equity Partners. The benchmark FTSE 100 Index gained 40.18, or 0.7 percent, to 5,945.25 at the close in London, the highest level since July 8. The gauge has advanced 20 percent from its low in October as the European Central Bank increased lending to banks and U.S. economic reports exceeded estimates. The FTSE All-Share Index also rose 0.7 percent today and Ireland’s ISEQ Index advanced 0.9 percent.
“The Chinese central bank cutting reserve requirements for China’s banks has fueled speculation that this will help industrial production, boosting U.K. commodity shares,” said David Jones, the chief market strategist at IG Index in London. “Although we can all be allowed a degree of skepticism regarding an imminent solution to the Greek bailout, investors still seem happy to look for excuses to buy, and stock markets still seem to have plenty of momentum, even considering how far they have come in recent months.”

European Stocks Rise as Ministers Discuss Greek Bailout; TNT Express Gains (Source: Bloomberg)
European (SXXP) stocks rose for a fourth day, extending a six-month high, as euro-area finance ministers met in Brussels to discuss a Greek bailout and China cut banks’ reserve requirements to boost growth. TNT Express NV surged 60 percent after rejecting a takeover offer from United Parcel Service Inc. PostNL NV, a shareholder in TNT, jumped 50 percent. BP Plc (BP/) advanced after an Oppenheimer & Co. analyst said the company may reach a settlement this week on the Gulf of Mexico oil spill. The Stoxx Europe 600 Index (SXXP) climbed 0.8 percent to 268.16 at the close of trading. The benchmark gauge has rallied 9.7 percent this year amid optimism that the euro area will contain its debt crisis and as the U.S. economy continued its recovery.

Dollar, Yen Advance on Concern that Greece Bailout Talks May Stumble (Source: Bloomberg)
The dollar and yen gained versus most major peers as concern a meeting of euro-area finance ministers will struggle to agree on terms for Greece’s second bailout spurred investor demand for haven currencies. The 17-nation euro fell for the first time in four days against the yen as a majority of euro nations pushed for bondholders to accept greater losses, a European diplomat said on condition of anonymity because the talks are ongoing. The Australian and New Zealand dollars weakened as Asian stocks fell, damping the allure of higher-yielding assets. “Markets aren’t optimistic about the outlook for the euro, and the fact that they are easily swung by headlines emphasizes deep-rooted concern,” said Marito Ueda, senior managing director in Tokyo at FX Prime Corp., a currency margin company. “The dollar is entering a rising trend.”
The yen advanced 0.2 percent against Europe’s common currency to 105.21 as of 9:18 a.m. in Tokyo. The dollar climbed 0.2 percent to $1.3212 per euro. The U.S. currency was little changed at 79.64 yen.

Euro up on China easing, Greece prospect; yen 6-mth low
SYDNEY/TOKYO, Feb 20 (Reuters) - The euro and commodity currencies rose on chances Europe will sign off on a rescue deal for Greece and after China's central bank joined counterparts globally in acting to stimulate growth.      
"While the actual RRR cut was as expected, the PBoC clearly supporting economic growth in the world's second-largest economy is positive for the AUD, NZD and risk assets more broadly," said Annette Beacher, head of Asia-Pacific research at TD Securities.

China Cuts Reserve-Ratio for Growth as Inflation Deters Interest-Rate Move (Source: Bloomberg)
China is seen making more cuts to banks’ reserve requirements to fuel lending and sustain economic growth as the housing market cools and Europe’s sovereign-debt crisis weighs on exports. The proportion of cash that lenders must set aside will fall half a percentage point from Feb. 24, the central bank said Feb. 18 on its website. Standard Chartered Plc forecasts at least three more reductions this year, while HSBC Holdings Plc (HSBA) sees a minimum of two. The ruling Communist Party aims to sustain the nation’s expansion without undermining a campaign to tame inflation that saw home prices drop in 47 of the 70 biggest cities in January. Policy makers may refrain from interest-rate cuts until nearer mid-year when consumer-price gains have slowed to below 3 percent from 4.5 percent last month, HSBC economist Qu Hongbin said yesterday in Hong Kong.
“We expect further easing measures from Beijing in the coming months, such as bigger new loans and at least two additional 50 basis point reserve-ratio cuts,” Qu said. Interest rates will “remain a secondary monetary policy tool.”

Japan’s Trade Deficit Widens to a Record as Export Slump Deepens: Economy (Source: Bloomberg)
Japan posted a record trade deficit in January as the yen’s strength and weaker global demand eroded manufacturers’ profits and slowed the nation’s recovery from last year’s earthquake and tsunami. The gap widened to 1.48 trillion yen ($19 billion) and shipments dropped 9.3 percent from a year earlier as energy imports surged, a Ministry of Finance reported in Tokyo today. The median estimate of 28 economists surveyed by Bloomberg News was for a shortfall of 1.46 trillion yen. The drag from trade risks countering the boost from reconstruction work that JPMorgan Securities forecasts will drive a return to growth this quarter after the economy shrank in the final three months of last year. The government is seeing progress in its campaign to rein in the yen, with the currency trading at the weakest in seven months against the dollar after the Bank of Japan last week announced extra monetary stimulus.
“The recovery pace may be slow,” said Kiichi Murashima, chief economist at Citigroup Global Markets Japan Inc. in Tokyo. “That’s because a recovery in exports may be dull and reconstruction demand may not come out as strongly as some people expect.”

Japan Agrees With China to Aid Europe Through IMF After Further Euro Steps (Source: Bloomberg)
Japanese Finance Minister Jun Azumi said that his nation and China are committed to help resolve the European debt crisis through the International Monetary Fund once euro region members take further steps themselves. “We shared the view that Europe needs to make more efforts to create a bigger firewall,” Azumi told reporters in Beijing yesterday after meeting Chinese Vice Premier Wang Qishan. “We also agreed to act together as the IMF will probably ask the U.S., Japan and China” to help boost its lending capacity. The meetings deepened dialogue between Asia’s two largest economies after a visit by Prime Minister Yoshihiko Noda to Beijing in December, and contrast with periodic tensions between the two over maritime boundaries. The continued readiness of Japan and China to help offers Europeans an inducement as they close in on a 130 billion-euro ($170 billion) Greek bailout.

Japan’s AA- Credit Rating May be Cut if Economic Outlook Weakens, S&P Says (Source: Bloomberg)
Standard and Poor’s affirmed Japan’s sovereign-debt rating at AA- while maintaining a negative outlook and warning that a downgrade is likely if medium-term growth prospects weaken. The ranking is supported by an “ample net external asset position, relatively strong financial system, and diversified economy,” S&P said in a statement today, also citing the yen’s role as a “key international reserve currency.” S&P has cut the ratings of European nations including France and Italy this year, along with reducing both the U.S. and Japan last year. Prime Minister Yoshihiko Noda is struggling to tame the world’s biggest public debt burden while supporting an economy that was hurt by last year’s earthquake and tsunami and shrank an annualized 2.3 percent in the fourth quarter. He’s yet to secure lawmakers’ support for a sales-tax increase intended to put the nation on a stronger financial footing.

Thai GDP Shrinks 9% Amid Floods in Fourth Quarter, Almost Twice Estimates (Source: Bloomberg)
Thailand’s economy shrank more than economists estimated as the worst floods in almost 70 years disrupted output by manufacturers from Western Digital Corp. to Honda Motor Co., putting pressure on policy makers to aid growth. Gross domestic product declined 9 percent in the three months through December from a year earlier, after climbing a revised 3.7 percent the previous quarter, the National Economic and Social Development Board said in Bangkok today. The median of 14 estimates in a Bloomberg News survey was for a 5 percent drop. The economy grew 0.1 percent in 2011. Southeast Asia’s second-largest economy contracted for the first time since 2009 after floods that killed more than 700 people and inundated two-thirds of the country dented exports already hurt by weaker European demand. Prime Minister Yingluck Shinawatra has pledged to spend 350 billion baht ($11 billion) on infrastructure and the Bank of Thailand cut the benchmark interest rate for a second straight meeting in January.

Greek Rescue in Prospect as Ministers Meet (Source: Bloomberg)
European governments moved toward a second rescue of Greece, calculating that the 130 billion-euro ($172 billion) cost of a fresh bailout is a price worth paying to prevent a default that could shatter the euro area. Finance ministers haggled into the night in Brussels over the terms of new loans to Greece and a possible contribution by central banks, and leaned on investors to accept bigger write- offs in a bond exchange that is vital to staving off a Greek bankruptcy next month. Bondholders’ response to the swap, Greece’s ability to prolong two years of austerity, and a series of parliamentary approvals in northern European countries gripped by an anti- bailout mindset loom as risks to the latest salvage operation. “We still have a bit of work to do,” German Finance Minister Wolfgang Schaeuble told reporters yesterday as he arrived for the meeting of euro-area finance chiefs. “We’ve set out to wrap up the decision on a new aid program for Greece. I’m confident.”

Iron Lady Merkel Bucks German Street (Source: Bloomberg)
Angela Merkel is having a Margaret Thatcher moment. Having spent six years in office defying comparison with Britain’s first woman prime minister, Merkel is being likened to Thatcher as she steers Europe’s response to the financial crisis with demands for debt reduction and tighter economic controls. Media including the Frankfurter Allgemeine Zeitung, the newspaper of record in Germany’s financial hub, dub her “Europe’s Iron Lady.” Strengthened by record-low joblessness at home, Merkel has rejected calls to either cut Greece loose from the euro area or ease her conditions for aid. By bucking the German street and steering the middle course, she is gambling that policy makers will continue to prevent a euro meltdown, helping her win re- election next year and match Thatcher’s third term.
“If Merkel were to go into elections with a collapsed euro zone she’d have a lot of difficulty winning,” Giles Merritt, head of Friends of Europe, a Brussels-based research group that promotes debate on the European Union, said in an interview. “Finally her statesman side is kicking in.”

Spain Sinks Deeper Into Periphery on Debt Rise (Source: Bloomberg)
Spain’s debt load is set to double from where it was when Europe’s sovereign debt crisis began, eroding the economic advantages that distinguished it from the region’s periphery and helped shield it from Greek (1004Z) contagion. Finance chiefs meet in Brussels today in the latest effort to save Greece from default. Spain went into the crisis with public debt of 40 percent of its gross domestic product, compared with an average ratio of 70 percent in the euro region. The European Union forecasts its debt will have almost doubled by next year, as Moody’s Investors Service says Spain is losing one of its “key relative credit strengths.” Investors give Spain a discount of just 30 basis points on borrowing for a decade compared with what they charge Italy, down from 200 basis points at the end of last year. Spain’s 10- year yield is 5.18 percent, up 33 basis points since Feb. 1.

20120221 0943 Global Commodities Related News.

Commodities Extend Rally on Greek Deal Optimism, China’s Bank Reserve Cut (Source: Bloomberg)
Commodities gained for a fourth day after China cut banks’ reserve requirements and speculation increased that euro-area governments are set to agree on a deal to release a second bailout for Greece, hurting the dollar. Oil rose as much as 1.9 percent to $105.21 per barrel in New York, the highest intraday price since May 5, after Iran said it halted some crude exports to Europe. Copper in London advanced as much as 2.7 percent to $8,396.50 per metric ton, rising for the first day in seven as base metals rallied. China cut the amount of cash that banks must set aside as reserves by half a percentage point from Feb. 24, the People’s Bank of China said Feb. 18. European finance ministers meet in Brussels today to try and close in on the 130 billion-euro ($172 billion) Greek bailout. The dollar declined against most of its 16 major counterparts, according to data tracked by Bloomberg.
“There’s a general feeling of optimism ahead of the Greece conclusion,” Jonathan Barratt, chief executive of Barratt’s Bulletin, a commodity-markets newsletter, said from Sydney. “They think they will resolve any outstanding disputes.”

Brazil planning giant Amazon soybean port-paper
RIO DE JANEIRO, Feb 18 (Reuters) - Brazilian port authorities are planning a new grains port in the Amazon region, a terminal designed to become the country's largest soybean export center and to slash transportation costs for farmers, the Folha de S. Paulo newspaper reported Saturday.
The proposed 18 million-tonne-a-year Port of Outeiro would be built near Belem, the largest city in Brazil's Amazon region.

Rains boost Argentina 2011/12 soy but more needed-gov't
BUENOS AIRES, Feb 17 (Reuters) - Rains that soaked parched Argentine 2011/12 soy this week boosted crop growth but some areas are still in need of showers, the Agriculture Ministry said on Friday.
Weeks of dry weather reduced prospects for a record 2011/12 harvest in the world's No. 3 soybean exporter, which is also the top supplier of soyoil and soymeal, though recent showers have improved the outlook, especially for later-seeded crops.

Brazil's top grain terminal resumes partial loading
SAO PAULO, Feb 17 (Reuters) - Brazil's TGG said on Friday it will resume loading soybeans, meal and corn at half capacity, ending a five-day interruption to exports from the main grain terminal in the country that should lead the world in soybean exports this year.
TGG expects to resume loading grain from two of its four grain loaders at 8 p.m. Brasilia time (2300 GMT), the company said in a statement. Each of its loaders can move 1,500 tonnes of dry bulk grains an hour.

China signs deals for record 13.4 mln T US soy
CHICAGO, Feb 17 (Reuters) - A Chinese trade delegation signed deals to buy a record amount of U.S. soybeans during a visit to the United States this week at a time when a harsh drought has slashed crops in rival soy exporters in South America.
The delegation inked agreements for 13.4 million tonnes valued at $6.7 billion, the U.S. Soybean Export Council said on Friday, a quarter of the more than 55 million tonnes the world's largest soybean buyer will import from global suppliers this year.

Brazil's 2012/13 coffee crop 55.0 mln bags-Neumann
HAMBURG, Feb 17 (Reuters) - Brazil's upcoming 2012/13 arabica coffee crop will reach 55.0 million 60-kg bags, giant German coffee trader Neumann Kaffee Gruppe (NKG) said in a report seen by Reuters on Friday.
This is lower than the forecast of 55.8 million bags made by Brazilian exporter Comexim on Feb. 3 and well over official Brazilian government forecasts of 49 million to 52.3 million bags.

Record Rice Harvests Seen Boosting Stockpiles to Decade High: Commodities (Source: Bloomberg)
Rice stockpiles are poised to reach the biggest in almost a decade as record harvests boost supplies and imports decline for the first time in three years. Inventories may gain 3 percent to 100.1 million metric tons, the most since 2003, as global imports contract 7.5 percent, the U.S. Department of Agriculture says. The Thai export price, a global benchmark, may tumble as much as 11 percent to $500 a ton in the first half, the lowest since June last year, the median of 11 trader and exporter estimates compiled by Bloomberg shows.
Rice slumped 15 percent from a three-year high in November as India, the second-biggest grower after China, lifted a three- year ban on exports of non-basmati grain and Thailand, the largest shipper, bought less than expected in the first four months of a government stockpiling program. That’s boosted supplies of the staple for half the world at a time when farmers are planting record wheat and corn crops. Global food costs dropped 10 percent from a record in February 2011, according to the United Nations.

Brent hits 8-mth top above $121 after Iran, China moves
SINGAPORE, Feb 20 (Reuters) - Brent crude futures rose  to above $121 a barrel, the highest in eight months, as Iran cut its exports to Britain and France months ahead of a European Union embargo and as a policy easing by China and hopes for a Greek bailout supported prices.
"This is supply related so it had a psychological impact on the oil market," Ken Hasegawa, a Tokyo-based commodity sales manager at Newedge Japan, said.

Japan Jan crude imports fall 2.1 pct yr/yr
TOKYO, Feb 20 (Reuters) - The volume of Japan's customs-cleared crude oil imports fell 2.1 percent in January from a year earlier, government data showed on Monday, extending the downtrend into a third month, while  imports of liquefied natural gas (LNG) hit a record high.
LNG demand in Japan, the world's third-biggest oil user and the top LNG importer, has been strong, reflecting the need for power generation to offset record low nuclear plant utilisation rates in the wake of the Fukushima crisis.

Iran stops oil sales to British and French firms
TEHRAN, Feb 19 (Reuters) - Iran has stopped selling crude to British and French companies, the oil ministry said on Sunday, in a retaliatory measure against fresh EU sanctions on the Islamic state's lifeblood, oil.
"Exporting crude to British and French companies has been stopped ... we will sell our oil to new customers," spokesman Alireza Nikzad was quoted as saying by the Ministry of Petroleum website.


US coal consumption rose 8 pct last week – Genscape
U.S. coal consumption rose 8 percent last week from the previous week but was down 4 percent from the same week a year ago, power industry data monitor Genscape said Friday.  
Coal use swings up and down seasonally, and varies from week  to week and region to region, depending on electricity demand to  run air-conditioners or power heaters.

Euro Coal-Prices rise 50 cents-$1.50 in quiet trade
LONDON, Feb 17 (Reuters) - Prompt European physical coal prices ticked higher again by 50 cents to $1.50 on Friday as less coal was offered.
No fresh trades were reported and activity was quiet, utilities and traders said.

Oil Rises to Nine-Month High on Iran Export Halt, Europe Bailout Meeting (Source: Bloomberg)
Oil traded near the highest price in nine months in New York amid speculation supplies may be disrupted after Iran said it halted some crude exports, while European finance ministers met to discuss a bailout of Greece. Futures climbed as much as 2.1 percent for a fourth day of gains, the longest rising streak since December. Iran will supply crude to “new customers” instead of companies in the U.K. and France, the oil ministry’s news website Shana reported Feb. 19, citing spokesman Alireza Nikzad Rahbar. European finance ministers haggled into the night in Brussels over the terms of a second rescue for Greece in less than two years as they aimed to prevent a default that could shatter the euro area and prompt a fresh round of market tumult.
Futures for March delivery, which expire today, advanced as much as $2.20 to $105.44 in intra-day trading, the highest since May 5. The contract was at $104.61 at 11:24 a.m. in Sydney, while the more actively traded April future gained $1.32 to $104.92. Floor trading was shut Feb. 20 for the U.S. Presidents’ Day holiday. Today’s trades will be booked with yesterday’s electronic transactions for settlement. Prices are 21 percent higher the past year.

Japan January crude steel output falls 10.60 pct yr/yr
TOKYO, Feb 20 (Reuters) - Japan's crude steel output fell 10.60 percent in January from a year earlier to 8.63 million tonnes, the Japan Iron and Steel Federation said. Output, which is not seasonally-adjusted, increased 2.70 percent from December.

Copper Gains as Top Consumer China Eases Policy Further to Stoke Lending (Source: Bloomberg)
Copper rose in London, rebounding from the longest losing streak since September, after China eased reserve requirements to stoke lending in the world’s biggest consumer of the metal. The proportion of cash that Chinese lenders must set aside will fall half a percentage point as of Feb. 24, the People’s Bank of China said Feb. 18. The reduction was the second in three months. Copper also climbed after money managers increased bets on price gains to the highest level since August. “The cut is certainly a step in the right direction,” Nic Brown, head of commodities research at Natixis Commodity Markets Ltd. in London, said by e-mail. Copper for three-month delivery settled 0.7 percent higher at $8,235.50 a metric ton on the London Metal Exchange. Prices slid 6.7 percent over six sessions before today. Copper for May delivery rose 1.1 percent to $3.7565 a pound by 1:06 p.m. on the Comex in New York, where floor trading was closed today for the Presidents’ Day holiday.

LME copper rallies after China policy easing
SHANGHAI, Feb 20 (Reuters) - London copper rallied  as a policy easing in China, the top consumer of most metals, and hopes that a bailout fund would be signed off for Greece buoyed riskier assets.
"It is a positive reaction (to China's policy easing), but we still have to see how sustainable these gains can be - we would need to see more signs of improving demand from the physical market," Singapore-based analyst Stefan Graber of Credit Suisse Private Banking said.


Iron Ore-Shanghai rebar ends 7-day slide on China easing
SINGAPORE, Feb 20 (Reuters) - China's efforts to boost lending boosted Shanghai steel futures rose half a percent on Monday after seven straight days of losses, but the modest gain suggests steel demand will remain weak until Beijing eases property market curbs.
China on Saturday said that it would cut the amount of cash banks need to keep with the central bank, joining global counterparts in stimulating economic growth.

China imported iron ore stocks dip in wk ending Feb 17
BEIJING, Feb 17 (Reuters) - Stockpiles of imported iron ore at major Chinese ports fell 1 percent this week to end Friday at 99.25 million tonnes, according to data from industry consultancy Mysteel.
Shipments from India rose slightly from last week, but there was a decline in deliveries from both Australia and Brazil.

China raises mining taxes on iron, tin, other minerals -paper
SHANGHAI, Feb 17 (Reuters) - China has increased mining taxes on iron ore, tin and a range of minerals in a bid to conserve resources, a newspaper reported on Friday, a move analysts said was aimed at regulating the industry by hiking costs for smaller producers.
The increase was effective Feb. 1, the Shanghai Securities News said. In addition to iron ore and tin, the levy also covers mining for molybdenum, magnesium, talc and boron, but officials at three major mining companies said they had not been notified of any levy changes.

Gold Imports by India May Drop From Record, Making China Biggest Consumer (Source: Bloomberg)
Gold imports by India will decline for the first time in three years in 2012 as rising prices deter jewelry buyers and investors, potentially allowing China to overtake the nation as the world’s largest consumer. Imports may drop 7.1 percent to 900 metric tons this year, according to the median estimate in a Bloomberg News survey of eight analysts, brokers and jewelers including Rajesh Exports Ltd. (RJEX), the biggest gold-jewelry exporter. India bought a record 969 tons in 2011, according to the World Gold Council. Falling imports may help to halt a rally in global prices that's set for a 12th year. Gold has surged as investors seek to protect their wealth from volatility in stock markets, depreciating currencies and the threat of inflation.

Gold advances on Greece optimism, China easing
SINGAPORE, Feb 20 (Reuters) - Gold prices climbed more than half a percent, as investors buoyed by easing moves by China's central bank and hopes for Greece to seal a bailout deal at a meeting with euro zone officials later in the day.
"There is the expectation that everyone is going to relax monetary policy, which will be good for stocks and commodities," said Ronald Leung, a physical dealer with Lee Cheong Precious Metals in Hong Kong.

China central bank may be behind surge in gold imports
SINGAPORE, Feb 17 (Reuters) - China's central bank, flush with foreign reserves, may be behind the surge in the country's gold imports late last year, but industry sources said the bank usually favours sourcing gold domestically over direct buying from overseas.
China's gold production, combined with imports from Hong Kong, exceeded consumer demand by 140 tonnes in the last quarter of
2011, according to Reuters calculations based on data from the World Gold Council (WGC) and Hong Kong trade numbers.

LME copper upbeat after China policy easing
London copper rallied as riskier assets were buoyed by a policy easing in China, the top consumer of most metals, and hopes that a bailout fund would be signed off for Greece.
"It is a positive reaction (to China's policy easing), but we still have to see how sustainable these gains can be -- we would need to see more signs of improving demand from the physical market," said Singapore-based analyst Stefan Graber of Credit Suisse Private Banking.

Gold advances on Greece optimism, China easing
SINGAPORE, Feb 20 (Reuters) - Gold prices climbed more than half a percent as investors buoyed by easing moves by China's central bank and hopes for Greece to seal a bailout deal at a meeting with euro zone officials later in the day.
"There is the expectation that everyone is going to relax monetary policy, which will be good for stocks and commodities," said Ronald Leung, a physical dealer with Lee Cheong Precious Metals in Hong Kong.

Baltic index dips 3rd day, big ships sour sentiment
Feb 17 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, fell for a third day on Friday as weak cargo business on the capesize and panamax markets battered sentiment.
The overall index, which gauges the cost of shipping commodities such as iron ore, cement, grain, coal and fertiliser, fell 6 points or 0.83 percent to 717 points.