20121217 1803 FCPO EOD Daily Chart Study.

FCPO closed : 2354, changed : +8 points, volume : lower.
Bollinger band reading : pullback correction downside biased.
MACD Histogram : rising higher, seller reducing position.
Support : 2350, 2300, 2270, 2250 level.
Resistance : 2400, 2450, 2490, 2520 level.
Comment :
FCPO closed recorded small gain with declined volume changed hand. Soy oil price currently trading firmer after last Friday closed 2% higher while crude oil price easing little lower.
FCPO price opened substantially higher after last Friday soy oil price surge but lower exports figure released by cargo surveyor pressure price to move downwards capping gain limited.
FCPO daily chart reading continue to suggesting a pullback correction downside biased market development with MACD having positive crossed 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.

20121217 1729 FKLI EOD Daily Chart Study.

FKLI closed : 1646.5 changed : -4.5 points, volume : lower.
Bollinger band reading : pullback correction upside biased.
MACD Histogram : weaknening, buyer taking profit.
Support :  1645, 1640, 1635, 1627 level.
Resistance : 1650, 1660, 1670, 1680 level.
Comment :
FKLI closed recorded loss with quiet volume traded doing 2 points discount compare to cash market that closed little lower. Last Friday U.S markets closed recorded small loss and today Asia markets ended mixed while European markets currently trading lower.
Global market traded mixed on unsettle U.S. budget discussion and Japan opposition party won landslide victory on its election.
Daily chart reading continue to suggesting a pullback correction 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.

20121217 1603 Global Markets & Commodities Related News.

STOCKS: European stock index futures pointed to a higher open and Japan's Nikkei average climbed to an 8-1/2-month high after a landslide victory by Japan's Liberal Democratic Party sparked recovery hopes for the world's third biggest economy. U.S. stocks fell on Friday as another slide in Apple took a toll and investors unloaded some shares because of the uncertainty surrounding the "fiscal cliff" negotiations. (Reuters)


FOREX-Yen skids to 20-mth low vs dollar after Japan LDP victory
TOKYO/SYDNEY, Dec 17 (Reuters) - The yen slumped to its lowest in over a year-and-a-half against the U.S. dollar as part of a broad skid after Japan's conservative Liberal Democratic Party, which is committed to aggressive monetary easing, won a landslide victory.  
"What remains to be seen is what policies will come next. There is no mistake that Abe had clearly spoken out for steps against deflation," said Kimihiko Tomita, head of foreign exchange for State Street Global Markets in Tokyo.


Boehner opens door to tax hikes, shifts US fiscal cliff talks (Reuters)
The first real movement in the "fiscal cliff" talks began on Sunday, with Republican House Speaker John Boehner edging slightly closer to President Barack Obama's key demands as they try to avert the steep tax hikes and spending cuts set to take effect unless Congress intervenes by Dec. 31.

GRAINS: Chicago soybeans hit a six-week top, stretching their gains into a fourth straight session after data showed last month's U.S. soy crush was the most in almost three years, while talk of purchases by top consumer China also supported prices. Corn slid, having touched a one-week high earlier in the session, while wheat tracked lower. (Reuters)

Argentina soy crop seen at 53 mln tonnes-Rosario exchange (Reuters)
Argentina's 2012/13 soybean harvest is seen at 53 million tonnes while corn production should reach 24 million tonnes, the Rosario grains exchange said on Friday in its first output forecasts for these crops.

OIL: Brent crude held steady above $108 a barrel, drawing support from a brighter economic outlook for top energy consumer China, although investors remained skittish as U.S. talks to avert a year-end "fiscal cliff" dragged on. (Reuters)

BASE METAS: London copper was steady, consolidating from a five-week winning streak on signs of reviving growth momentum in top consumer China, while tentative progress on the U.S. "fiscal cliff" helped warm investor sentiment towards metals. (Reuters)

PRECIOUS METALS: Gold edged lower, extending losses to a third straight session, as slowing trade ahead of the year-end holidays responded little to the latest progress in the U.S. budget talks. (Reuters)


METALS-Copper edges up as China revival, US hopes support
SINGAPORE, Dec 17 (Reuters) - London copper edged up after a five-week winning streak, on signs of reviving growth in top consumer China and tentative progress in U.S. "fiscal cliff" talks that helped warm investor sentiment towards metals.
"There was some pretty good momentum over the weekend in the fiscal cliff negotiations. I don't think there are many people expecting the negotiations to blow up," said metals analyst Ivan Szpakowski at Credit Suisse in Singapore.

PRECIOUS-Gold edges down; extends losses to third day
SINGAPORE, Dec 17 (Reuters) - Gold edged lower extending losses to a third straight session, as trade slowed ahead of the year-end holidays and investors showed little response to the latest progress in U.S. budget talks.
"Participation is really low right now," said a Hong Kong-based trader. "It hasn't been a very exciting year for most people and I don't think they want to stick around for the last week and a half. People want to put away everything before starting on a totally clean slate in 2013."


Baltic Index down on weak capesize, panamax rates
Dec 14 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry commodities, fell on Friday as capesize and panamax rates continued their losing streak.
The overall index, which reflects daily freight market prices for capesize, panamax, supramax and handysize dry bulk transport vessels, fell 1.88 percent to 784 points. The index has dropped about 16 percent this week.

20121217 1702 Soy Oil & Palm Oil Related News.

Malaysia sets January crude palm oil export tax at zero percent 0#FCPO: - RTRS
17-Dec-2012 17:05
SINGAPORE, Dec 17 (Reuters) - Malaysia, the world's No.2 palm oil producer, will set its crude palm oil export tax for January at zero percent, a government circular showed on Monday.
The Southeast Asian country has calculated a reference price of 2,147.81 ringgit per tonne for crude palm oil for January, effectively setting the export duty for the grade at zero.
Malaysia announced in October that it will reduce export taxes for crude from 23 percent and it will set duties on a monthly basis to better reflect international prices, responding to rival Indonesia's own tax reforms.

TABLE-Malaysia's official crude palm oil export tax schedule 0#FCPO: - RTRS
17-Dec-2012 17:14
KUALA LUMPUR, Dec 17 (Reuters) - Following is the official crude palm oil export tax schedule for Malaysia, the world's No.2 producer of the edible oil, issued by the government on Monday:


    CRUDE PALM OIL MARKET PRICE             EXPORT DUTY
    (FOB RM/TONNE)                             (in pct)
    Less than 2,250                              nil
    2,250-2,400                                  4.5
    2,401-2,550                                  5.0
    2,551-2,700                                  5.5
    2,701-2,850                                  6.0
    2,851-3,000                                  6.5
    3,001-3,150                                  7.0
    3,151-3,300                                  7.5
    3,301-,3450                                  8.0
    More than 3,450                            8.5



Malaysia says imposes zero export duty for crude palm oil for Jan 2013. (Reuters)
Malaysia says sets reference price for crude palm oil gfor Jan 2013 at RM2,147 per tonne.(Reuters)

VEGOILS-Palm gains on soybean oil, but exports cap gains BOZ2 DBYF3 FCPOc3 - RTRS
17-Dec-2012 14:04
Palm edges up on Dalian, Chicago soybean oil Malaysia Dec 1-15 palm oil exports down 6.4 pct -ITS Traders looking out for Malaysia's new crude palm oil tax for Jan

(Updates prices, adds detail)
By Chew Yee Kiat
SINGAPORE, Dec 17 (Reuters) - Malaysian palm oil futures inched up on Monday, riding on rival soybean oil's gains after U.S. soy crushing data sent soybeans to a six-week peak.
Chicago soybeans hit their highest since Nov. 8 after data from the National Oilseed Processors Association showed U.S. soybean processors crushed the most soybeans in almost three years and on higher demand especially from top buyer China.
Soybean oil rose in tandem, supporting palm oil, a competing vegetable oil used to make products ranging from food to biofuels.
Gains were limited, however, as concerns over high stockpiles remained, especially as the latest data pointed to signs of slowing exports, although traders said easing production could help bring down stock levels.
"The market is up a bit on the back of Dalian and Chicago soybean oil," said a trader with a foreign commodities brokerage in Malaysia. "Malaysian palm production should come down this month, so inventory should probably go down a bit."
By the midday break, the benchmark March contract FCPOc3 on the Bursa Malaysia Derivatives Exchange had gained 0.4 percent to 2,355 ringgit ($771) per tonne.
Total traded volumes stood at 13,501 lots of 25 tonnes each, higher than the usual 12,500 lots.
Exports of Malaysian palm oil products for Dec. 1-15 fell 6.4 percent to 719,817 tonnes from 769,087 tonnes for the Nov. 1-15 period, cargo surveyor Intertek Testing Services said on Saturday. PALM/ITS
Another cargo surveyor Societe Generale de Surveillance will issue data for the same period later on Monday. PALM/SGS
Traders are waiting for Malaysia's new January crude palm oil export tax, which could be announced either on Monday or Tuesday, according to a government source who declined to be identified as he is not authorised to speak to the media.
The tariff, likely to be set at zero, could boost export demand for the crude grade and help lower inventory levels in the world's No.2 largest palm producer.
In related markets, Brent crude held steady above $108 a barrel on Monday, drawing support from a brighter economic outlook for top energy consumer China, although investors remained skittish as U.S. talks to avert a year-end "fiscal cliff" dragged on. O/R
In other vegetable oil markets, U.S. soyoil for January delivery BOF3 had edged down 0.1 percent by 0545 GMT after earlier gains. The most active May 2013 soybean oil contract DBYcv1 on the Dalian Commodity Exchange was up 1.2 percent.

20121217 1108 Global Markets & Energy Related News.

GLOBAL MARKETS-Yen fall boosts Nikkei, Asian shares pause on "fiscal cliff"
TOKYO, Dec 17 (Reuters) - The Liberal Democratic Party of Japan's electoral triumph propelled the yen to a 20-month low that saw the Nikkei stock average open up 1.6 percent on expectations of much better export earnings.
"I think that the policies that Abe plans to introduce will only serve to weaken the yen even further. If there is an unwinding opportunity, it will likely be short lived, maybe falling back to 82 or so on the USD/JPY," said Neal Gilbert, market strategist at GFT Forex.

FOREX-Yen slumps to 20-mth low following LDP victory
SYDNEY, Dec 17 (Reuters) - The yen slumped to its lowest in over a year-and-a-half against the U.S. dollar as part of a broad skid after Japan's conservative LDP party, pledged to hyper-easy monetary policy, won a landslide victory at an election.
"Our view is that PM Abe is unlikely to sound as aggressive as he came across as the leader of the opposition. We also believe markets are putting too much emphasis on the BoJ policy and too little on the Fed's, especially after the latter fully delivered last week," strategist Vassili Serebriakov wrote in a report.

Boehner opens door to tax hikes, shifts US fiscal cliff talks
WASHINGTON, Dec 16 (Reuters) - U.S. House of Representatives Speaker John Boehner's offer to accept a tax rate increase for the wealthiest Americans knocks down a key Republican road block to a deal resolving the year-end "fiscal cliff."
The question now boils down to what President Barack Obama offers in return. Such major questions, still unanswered so close to the end of the year suggest, however, that no spending and tax agreement is imminent.

Oil rises on China data as January Brent nears expiry
NEW YORK, Dec 14 (Reuters) - Oil prices rose on Friday on expectations for improved demand in China after data showed the manufacturing sector of the world's No. 2 oil consumer expanded in December at its fastest pace in more than a year.
"Oil is particularly dominated by Chinese potential demand, and any sign of an upturn in China tends to have a positive effect on oil," said Tony Machacek, a broker at Jefferies Bache in London.

20121217 1057 Malaysia Corporate Related News.

Gamuda: Extends MD's contract for 5 years. Gamuda Bhd group managing director Datuk Lin Yun Ling will head the conglomerate for another 5 years. In an announcement to Bursa Malaysia last Friday, the group said that its board of directors had appointed Lin's contract renewal for 5 years, from July 1, 2013 to June 20, 2018. In a press conference after the company AGM last week, Lin said that he would accept the contract renewal for another term if he was offered by the board. (Source: The Edge Financial Daily)

Banking: Kenanga-ECM Libra merger to dominate IA sector. Kenanga Invetsment Bank Bhd aims to dominate the independent advisory (IA) segment, leveraging its acquisition of ECM Libra Investment Bank Bhd. The merger will make the group the largest independent investment bank in the country. The MYR875.1m acquisition, sealed last Friday, will see Kenanga rationalise its operations to materialise merger synergies. (Source: The Edge Financial Daily)

Healthcare: B. Braun plans MYR1.75b expansion. B. Braun vice-president of operations and head of global centre of excellence for Intravenous Access Dr Juergen Schloesser said the company will invest MYR1.75b in its Penang plant to expand research and development facilities. With with a state-of-the-art automation and production technology, the company aims to increase its production by 50% by the end of 2013. The Penang plant is the largest production site outside Europe, which houses production plants for medical devices, surgical instruments and pharmaceuticals in the region with some 5,000 employees. (Source: Business Times)


Bank Muamalat posts lower profit
Bank Muamalat Malaysia posted a lower pre-tax profit of RM120.2m for its first half-year ended 30 Sept compared with RM123.5m in the same period previously. In a statement last Friday, the bank said net income rose 19.2% to RM496.4m from the previous corresponding period, underpinned by higher financing income. (Financial Daily)

AirAsia aims high
AirAsia, which is buying 100 more Airbus aircraft valued at USD9.4bn as it transforms into an Asian airline, sees the potential to achieve the target of between 60m and 70m passengers. AirAsia chief executive officer Tan Sri Tony Fernandes said the low-cost carrier was in a fantastic part of the world, especially in South-East Asia. Fernandes said 50% of AirAsia’s destinations are those which had not been served by airlines and it has been able to open new routes and destinations. (StarBiz)

UEM sells RM600m of five-year sukuk at 4.25%
UEM Land, Malaysia’s biggest property company, cut costs on its first Islamic bond after investors bid for six times the amount on offer, seeking to diversify holdings amid a shortage of real estate sukuk. The company, ranked the fourth-highest investment grade of AA- by Malaysian Rating Corp, sold RM600m of five-year notes at 4.25%, the low-end of its price guidance, according to an e-mail statement that clarified orders were close to RM3.7bn. (StarBizWeek)

Pharmaceutical tech park to draw RM1.5bn
Malaysian Biotechnology Corp (BiotechCorp) expects the pharmaceutical technology park in Alor Gajah, Malacca, to attract RM1.5bn (USD500m) in investments in the next three years. BiotechCorp chief executive officer Datuk Dr Mohd Nazleen Kamal said the investments would include the cost to develop the park. He said the first phase of the park consisted of 81ha, with construction expected to start by the fourth quarter next year or the first quarter of 2014. (StarBizWeek)

IJM India to launch RM168m project in Hyderabad
IJM (India) Infrastructure, a subsidiary of IJM Corp, plans to launch a new commercial development project here with a gross development value of 300 crore rupees (RM168m) next year, its country head Anthony Teoh said. The development will be on a 1.6ha site and the company hopes to start the project next year, which will be followed by a mixed development project. (Financial Daily)

MAS-GMR Aerospace Engineering in talks with Spicejet for MRO biz
MAS-GMR Aerospace Engineering (MGAE) is in talks with India’s budget airline Spicejet to provide maintenance, repair and overhaul (MRO) services for its new fleet of Bombardier Q400s. Spicejet was MGAE’s first customer since its operation on 1 Nov 2011, its chief executive officer Khairuddin Hamzah said. (Malaysian Reserve)

Takaful Malaysia declares second interim dividend of 10%
Syarikat Takaful Malaysia declared a second interim dividend of 10% for the financial year ending 31 Dec 2012 last Friday, bringing the total dividends declared to 25%. In a statement last Friday, the company said this translated into a dividend yield of 4.62% based on its share closing price of RM5.41 as at 13 Dec. The total interim dividend represented a payout ratio of about 60% of the net profits generated for the period ended 30 Sept 2012. (Malaysian Reserve)

Malakoff to issue RM460m sukuk to buy Hicom Power
Malakoff Corp’s move to buy Hicom Power for RM575m will be funded primarily by a sukuk issuance. This is seen as a move to strengthen the MMC Corp’s energy utilities subsidiary before its initial public offering in the second-quarter of next year. The acquisition of Hicom Power, an operation and maintenance company for power plants, will be funded by issue of sukuk worth RM460m while the rest will be paid through internally generated funds. (Malaysian Reserve)

FGVH, Astro to replace AirAsia, MMHE on KLCI index from 24 Dec
Felda Global Ventures Holdings (FGVH) and Astro Malaysia Holdings, which raised funds in two of Asia’s biggest initial public offerings this year, will join the country’s benchmark FTSE Bursa Malaysia KLCI Index from 24 Dec. AirAsia, the region’s biggest low-cost carrier, and Malaysia Marine and Heavy Engineering Holdings (MMHE), a rig builder, will make way in the half-yearly review, FTSE Group and Bursa Malaysia said in a joint statement last Thursday. (Malaysian Reserve)

20121217 1056 Global Economy Related News.

China: Signals tolerance of slower growth after annual meeting
China said it will seek a higher “quality and efficiency” of growth next year, signaling new leaders may accept a reduced pace of expansion in exchange for a more sustainable model. There was no mention of seeking “relatively fast” growth, a policy in place since 2006, in a report by the state-run Xinhua News Agency after the annual central economic work conference in Beijing. Leaders vowed to target “sustained and healthy development” as they maintain a “prudent” monetary policy and “proactive” fiscal stance, Xinhua said. (Bloomberg)

Japan: Abe’s victory seen eroding demand for biggest debt
Shinzo Abe’s victory in the Japanese elections gives him a mandate to implement the fiscal and monetary stimulus plans that have already fueled a slump in 20-year government bonds and the yen. The yield premium investors demand to hold 20-year deb,t instead of 10-year securities, that climbed to 99 basis points on 5 Dec., the highest since 1999. That compares with a spread of 68 basis points for similar-maturity US Treasuries. The yen sank to a 20-month low today and has fallen more than 5% against the dollar since 15 Nov., when Abe called for “unlimited” monetary easing by the Bank of Japan to end deflation and an increase in public-works spending, fueling concern the world’s largest debt may expand.(Bloomberg)

EU and Singapore completes free trade pact negotiations
The European Union and Singapore concluded negotiations on a free-trade agreement after almost three years of talks, boosting the bloc’s efforts to increase commerce with Asian nations to revive economic growth. The EU will eliminate tariffs on all imports from Singapore over five years, while the island will allow duty-free access for all incoming shipments from the region immediately, the city’s Ministry of Trade and Industry said in a statement today. The deal will help companies from both signatories to bid for government contracts in the other’s market. (Bloomberg)

US: Spending probably rose, home sales climbed in Nov
Consumer spending probably rose in November as Americans set aside the threat of higher taxes next year while shopping for the holidays, economists said before reports this week. Household purchases increased 0.4% last month after declining 0.2% in October, according to the median estimate from 66 economists surveyed by Bloomberg before 21 Dec figures from the Commerce Department. Other reports may show home sales and demand for long-lasting goods climbed. “The economy is holding in,” said Jim O’Sullivan, chief US economist for High Frequency Economics Ltd. in Valhalla, New York. “For the household sector, the housing numbers have been quite good. The labor market numbers are OK.” (Bloomberg)

20121217 1052 Global Markets Related News.

Asia FX By Cornelius Luca - Sun 16 Dec 2012 17:16:35 CT (CME/www.lucafxta.com)
The European currencies open further up in the Far East after all major foreign currencies but the Canadian dollar advanced on Friday. The yen fell to the lowest level in over a 1 ½- year after Japan's conservative LDP party, pledged to hyper-easy monetary policy, won a landslide victory at an election. The financial markets remain focused on the "fiscal cliff" politics. While this should surely end in lifting the debt ceiling, the mangled process re-emphasizes the polarized psych in the US and politicians' lack of eagerness to cooperate despite the dire straits of the US and world economies. As of Saturday, President Barack Obama was not ready to accept a new offer from the Republican leader of the US House of Representatives to raise taxes on top earners in exchange for major cuts in entitlement programs.
The short-term outlook for the financial currencies is sideways with various biases. The medium-term outlook for most of the foreign currencies is sideways. The LGR short-term model is long on all European and commodity currencies and short yen. Good luck!

Overnight
US: Industrial production surged 1.1% in November after falling by a downwardly revised 0.7% in October. The rate of capacity utilization climbed to 78.4% in November from a revised 77.7% in October.
US: The consumer price index fell by 0.3% in November following a 0.1% increase in October. The core CPI inched up 0.1% in November after rising by 0.2% in October.

Asia Stocks Swing Between Gains, Losses on Japan Election (Bloomberg)
Asian stocks swung between gains and losses on signs the market may be overbought, while Japanese shares jumped after a party that backs more economic stimulus returned to power, spurring a drop in the yen.
The MSCI Asia Pacific Index was little changed at 127.45 as of 10:28 a.m. in Tokyo after falling as much as 0.3 percent. The MSCI Asia Pacific excluding Japan Index fell 0.2 percent to 464.06.
The 14-day relative strength index of the MSCI Asia Pacific Index climbed to 77 on Dec. 14, rising above the 70 threshold that some traders say signals equities are overheating.

China’s Stock Futures Rise, Signaling Shares Will Extend Rally (Bloomberg)
China’s stock-index futures rose, signaling shares will extend a rally that was the biggest in three years.
Futures on the CSI 300 Index (SHSZ300) expiring in December gained 0.5 percent to 2,372.40 as of 9:18 a.m. local time. Shanghai Electric Group Co. may be active after pulling a private share placement application. Zoomlion Heavy Industry Science & Technology Co. may advance after its Hong Kong-listed shares were upgraded at Credit Suisse Group AG. China’s annual central economic work conference concluded over the weekend with a target of higher “quality and efficiency” of growth next year.
The Shanghai Composite Index (SHCOMP) climbed 4.3 percent to 2,150.63 on Dec. 14, with trading volumes more than double the 30-day average, amid speculation state-backed institutions were buying shares as a manufacturing survey added to optimism the world’s second-largest economy will rebound. The CSI 300 Index jumped 5.1 percent to 2,355.86.
The Hang Seng China Enterprises Index (HSCEI) of Chinese companies traded in Hong Kong advanced 1.5 percent. The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S gained 1.4 percent.
The Shanghai Composite has dropped 2.2 percent this year, heading for a third straight annual loss. The measure trades at 11.9 times reported earnings after valuations fell to 10.8 this month, the lowest level since at least 1997, data compiled by Bloomberg show.

China’s Stocks Advance, Extending Biggest Rally in Three Years (Bloomberg)
China’s stocks rose, extending the benchmark index’s biggest rally in three years, led by industrial and consumer discretionary companies.
Zoomlion Heavy Industry Science & Technology Co. advanced 2.8 percent after its Hong Kong-listed shares were upgraded at Credit Suisse Group AG. Great Wall Motor Co. climbed to a record. China’s annual central economic work conference concluded over the weekend with a target of higher “quality and efficiency” of growth.
The Shanghai Composite Index (SHCOMP) added 0.4 percent to 2,159.99 at 9:52 a.m. local time. The gauge jumped 4.3 percent on Dec. 14, the most since October 2009, amid speculation state-backed institutions were buying shares as a manufacturing survey added to optimism the world’s second-largest economy will rebound. The CSI 300 Index (SHSZ300) climbed 0.5 percent to 2,367.85. The Hang Seng China Enterprises Index (HSCEI) advanced 0.3 percent in Hong Kong.
“We may see some profit taking along the way but the overall sentiment has improved,” Zhang Lei, an analyst with Minsheng Securities Co., said by phone from Beijing. “The rally looks likely to stay.”
The Shanghai Composite has rebounded 10 percent since slumping to an almost-four year low on Dec. 3. The gains have pared this year’s drop to 1.8 percent, which would be a third straight annual loss. The measure trades at 11.9 times reported earnings after valuations fell to 10.8 this month, the lowest level since at least 1997, data compiled by Bloomberg show.
Trading volumes on the Shanghai Composite were three times the 30-day average for this time of day.

Nikkei 225 Advances to Eight-Month High on LDP Victory (Bloomberg)
Japanese shares gained, with the Nikkei 225 Stock Average heading to its highest close in eight months, after the Liberal Democratic Party reclaimed power in a landslide yesterday, lifting optimism for an economic recovery.
Fast Retailing Co., Asia’s biggest clothing retailer, gained 3.5 percent. Honda Motor Co. (7267), an automaker that counts North America as its biggest market, gained 1.3 percent after the yen weakened against the dollar. Tokyo Tatemono Co., a property developer, increased 7 percent. Asahi Glass Co. sank 2.7 percent after the Nikkei newspaper said the company may miss its profit forecast.
The Nikkei 225 rose 1.4 percent to 9,877.07 as of 9:46 a.m., its highest since April 3. The measure has gained 14 percent since Nov. 14, when elections were announced. The LDP has called for more monetary easing and a doubling of the nation’s inflation goal. The broader Topix Index climbed 0.9 percent to 808.48, with all but one of its 33 industry groups gaining.
“The market hasn’t priced in this kind of a landslide win,” said Hideyuki Ishiguro, senior strategist at Okasan Securities Co. in Tokyo. “There’s more certainty that LDP will make progress in deflation-fighting agenda. This could be a turning point for Japanese stocks.”
The LDP yesterday captured 294 seats in the 480-member lower house of parliament, while Prime Minister Yoshihiko Noda’s Democratic Party of Japan lost three-fourths of its lawmakers, according to public broadcaster NHK’s vote count. LDP leader Shinzo Abe, 58, is set to replace Noda, returning to the office he left five years ago for health reasons.

U.S. Stocks Fall for Week as Budget Talks Overshadow Fed, Growth (Bloomberg)
U.S. stocks had their first weekly decline in a month as budget talks dragged on, overshadowing the Federal Reserve’s plan to expand bond purchases and better-than- estimated economic data.
Consumer companies fell the most among 10 groups in the Standard & Poor’s 500 Index as analysts cut ratings for Family Dollar Stores Inc. (FDO) and Priceline.com Inc. Apple Inc. (AAPL) sank 4.4 percent after UBS AG and Jefferies & Co. lowered their share- price estimates. Berkshire Hathaway Inc. (BRK/A) and DuPont Co. each climbed 2.1 percent amid optimism over share buybacks. An index of steelmakers rallied 7 percent as economic data beat forecasts in China, the world’s biggest buyer of industrial metals.
The S&P 500 fell 0.3 percent to 1,413.58, snapping a three- week gain. The Dow Jones Industrial Average declined 20.12 points, or 0.2 percent, to 13,135.01 for the week.
“The market would love for a fiscal cliff deal to be announced, then it would trend back to really the fundamentals, which are actually looking better,” David Chalupnik, head of equities at Nuveen Asset Management in Minneapolis, said in a phone interview. His firm manages $112 billion. “Time is running out here pretty quickly for certainly a grand bargain type of deal.”
President Barack Obama and Republican House Speaker John Boehner remained deadlocked during their third White House meeting on next year’s budget. More than $600 billion in tax increases and spending cuts are scheduled to start taking effect in January unless Congress acts to avert them.

European Stocks Little Changed This Week; Peugeot Rallies (Bloomberg)
European stocks were little changed this past week, following three weeks of gains, as concern U.S. lawmakers won’t agree on a budget before the holiday offset optimism that the euro area will get a single banking regulator.
PSA Peugeot Citroen SA soared 16 percent, the biggest rally on the Stoxx Europe 600 Index (SXXP) this past week, as the carmaker said it will cut another 1,500 jobs. Alcatel Lucent SA jumped 6.4 percent after winning a financing deal. Deutsche Bank AG declined 5.5 percent after Germany’s biggest lender said fourth- quarter profit will fall short of analysts’ estimates.
The benchmark Stoxx Europe 600 Index rose 0.1 percent to 279.4 this past week. The equity benchmark has rallied 19 percent from this year’s low on June 4 as the European Central Bank and the Federal Reserve introduced bond-buying programs.
“Investors have had a good year with good results and don’t want to take on more risk until the end of the year,” said Paulo Goncalves, financial assets manager at Banco Popular Portugal SA in Lisbon. “The market is hitting very close to resistance levels, so it’s now beginning to move sideways as we reach the end of the year.”
European stocks will struggle to extend their rally this year as the region’s benchmark measure trades close to a key resistance level. The Stoxx 600 remains stuck near the 50 percent Fibonacci retracement level of the slump between July 2007 and March 2009 in the aftermath of the financial crisis.


Korea Won Rises Toward 15-Month High as Abe Wins in Japan (Bloomberg)
South Korea’s won rose toward a 15- month high and government bonds fell on speculation Japan will step up monetary easing after Japan’s Liberal Democratic Party reclaimed power in yesterday’s elections.
The yen fell to its weakest level since April 2011 versus the dollar, while the won appreciated against the yen for a ninth day. Shinzo Abe’s LDP is proposing a “large scale” supplementary budget to stimulate the economy, according to election pledges posted on its website. South Korea’s central bank Governor Kim Choong Soo said last week that “appropriate” action on won volatility will be taken if needed.
“Investors are doing cross trades of selling the yen and buying the won, and expectations for further monetary easing by Japan are also supporting the won on inflows optimism,” said Byeon Ji Young, a Seoul-based currency analyst for Woori Futures Co. “Still, won appreciation is being limited near the 1,072 per dollar level on government intervention concerns.”
The won appreciated 0.2 percent to 1,073 per dollar as of 9:33 a.m. in Seoul, according to data compiled by Bloomberg. The currency touched 1,071.08 on Dec. 13, the strongest level since Sept. 8, 2011. One-month implied volatility, a measure of expected moves in exchange rates used to price options, slid 10 basis points, or 0.10 percentage point, to 4.75 percent.
The yield on South Korea’s 2.75 percent bonds due September 2017 increased one basis point to 3.01 percent, Korea Exchange Inc. prices show. The one-year interest-rate swap was little changed at 2.82 percent.
South Koreans vote Dec. 19 to replace President Lee Myung Bak, whose five-year term ends in February. Candidate Lee Jung Hee abandoned the race yesterday, providing a boost for main opposition contender Moon Jae In as he trails the front-runner from the ruling New Frontier Party by less than 1 percentage point.

Yen Falls to Weakest Since April 2011 on Abe Victory (Bloomberg)
The yen fell to its weakest level since April 2011 versus the dollar as Shinzo Abe’s victory in Japan’s general election adds to the case for the nation’s central bank to expand stimulus as early as this week.
The yen tumbled to an almost nine-month low against the euro after Abe’s Liberal Democratic Party captured 294 seats in the 480-member lower house of parliament yesterday, while Prime Minister Yoshihiko Noda’s Democratic Party of Japan lost three- fourths of its lawmakers, according to public broadcaster NHK’s vote count. Japan’s stocks rose and government bonds slid.
The election results would mean “the monetary policy which Abe has been advocating will become a real possibility,” said Yuji Saito, director of the foreign-exchange department in Tokyo at Credit Agricole SA. (ACA) “The market may try to weaken the yen beyond the psychological level of 85” per dollar, he said.
The yen declined to as low as 84.48 per dollar, the weakest since April 12, 2011. It was at 84.07 as of 9:04 a.m. in Tokyo, 0.7 percent below the close in New York on Dec. 14. Japan’s currency fell 0.7 percent to 110.63 per euro, after touching 111.32, the weakest since March 21. The dollar was little changed at $1.3162 per euro.
The Nikkei 225 Stock Average jumped 1.5 percent to 9,886.76. The nation’s 10-year bonds declined, pushing yields on the benchmark 10-year note up by 1 basis point, or 0.01 percentage point, to 0.735 percent.

Australian, N.Z. Dollars Gain Against Yen on Abe Victory (Bloomberg)
The Australian dollar rose to the strongest in 19 months versus the yen after Japan’s Liberal Democratic Party, led by Shinzo Abe, reclaimed power in yesterday’s elections.
New Zealand’s dollar touched a four-year high versus the Japanese currency amid speculation the election results add to the case for more Bank of Japan (8301) stimulus as early as this week. Gains in the so-called Aussie were limited before the Reserve Bank of Australia releases minutes tomorrow from this month’s meeting, at which the central bank cut interest rates by 25 basis points. Australian bond yields touched three-month highs.
“We had a very large lift in the dollar-yen and yen crosses after the election result,” said Joseph Capurso, a Sydney-based currency strategist at Commonwealth Bank of Australia, the nation’s biggest lender. “The RBA minutes are likely to put a little bit of downward pressure on the Aussie because they’re likely to indicate the RBA is still open to further easing.”
The Australian dollar gained 0.4 percent to 88.58 yen as of 12:42 p.m. in Sydney from Dec. 14, after earlier touching 89.13, the highest since May 2, 2011. The Aussie fell 0.2 percent to $1.0544. The currency touched NZ$1.2455, the lowest since Oct. 9, before trading at NZ$1.2465.
New Zealand’s dollar, known as the kiwi, reached 71.51 yen, the strongest since October 2008, before trading at 71.06, 0.5 percent above the close in New York. The currency was little changed at 84.58 U.S. cents from 84.63 on Dec. 14.

Treasuries Fall for Second Week Amid Inflation Concern (Bloomberg)
Treasuries fell for a second week, the first back-to-back losses in three months, as the Federal Reserve’s expansion of a bond-buying program spurred speculation inflation will increase.
Thirty-year yields touched a five-week high after the Federal Open Market Committee announced plans to buy $45 billion of Treasuries a month and took the unprecedented step of linking stimulus measures to unemployment and inflation. Losses were tempered by concern a budget standoff in Washington may push the economy into recession. The U.S. sold $66 billion in notes and bonds, and said it will auction $113 billion of notes next week.
“The Fed’s message was one of higher tolerance for inflation, and they are purchasing less on the long end, which has been bearish for bonds,” said Gary Pollack, head of fixed- income trading at Deutsche Bank AG’s Private Wealth Management unit in New York. “Still, the driving force in the market is the uncertainty around the fiscal cliff, and until that’s resolved we won’t stray far from the range.”
The 30-year bond yield increased five basis points, or 0.05 percentage point, to 2.86 percent this week in New York, according to Bloomberg Bond Trader prices. It touched 2.93 percent on Dec. 13, the highest level since Nov. 2. The price of the 2.75 percent security due in November 2042 sank 1 2/32, or $10.63 per $1,000 face amount, to 97 23/32. The last time it fell two consecutive weeks was in September.
The yield on the benchmark 10-year note climbed eight basis points to 1.7 percent.

Industrial Production in U.S. Jumps on Rebound From Sandy (Bloomberg)
Industrial production jumped in November by the most in two years as U.S. manufacturers began to rebound from the damage inflicted by superstorm Sandy.
Output at factories, mines and utilities increased 1.1 percent last month, the most since December 2010, after a 0.7 percent drop in October that was larger than previously estimated, the Federal Reserve reported today in Washington. Other data showed consumer prices fell last month as fuel costs retreated.
Manufacturing, which stumbled in the second half of the year, is stabilizing as housing recovers, auto sales improve and growth in countries such as China shows signs of picking up. The deadlock over the federal budget remains a hurdle for American factories as a failure to avert tax increases and spending cuts is projected to trigger a recession in world’s largest economy.
“The outlook for the back half of 2013 is actually not that bad,” as long as lawmakers reach a budget deal, said Carl Riccadonna, a senior U.S. economist at Deutsche Bank Securities Inc. in New York, one of the top industrial-production forecasters over the past two years according to Bloomberg Rankings. “We do have decent job gains, decent income gains, consumer spending is holding up and housing is turning around. You could easily see a constructive profile for the economy.”
Stocks fell, extending yesterday’s drop, as a slump in Apple Inc. and budget-talk concerns overshadowed the rise in industrial production and data showing China’s manufacturing may expand at a faster pace. The Standard & Poor’s 500 Index decreased 0.4 percent to 1,413.58 at the close in New York. Treasury securities rose, sending the yield on the benchmark 10- year note down to 1.70 percent from 1.73 percent late yesterday.

Spending Probably Rose in U.S., Home Sales Climbed (Bloomberg)
Consumer spending probably rose in November as Americans set aside the threat of higher taxes next year while shopping for the holidays, economists said before reports this week.
Household purchases increased 0.4 percent last month after declining 0.2 percent in October, according to the median estimate from 66 economists surveyed by Bloomberg before Dec. 21 figures from the Commerce Department. Other reports may show home sales and demand for long-lasting goods climbed.
“The economy is holding in,” said Jim O’Sullivan, chief U.S. economist for High Frequency Economics Ltd. in Valhalla, New York. “For the household sector, the housing numbers have been quite good. The labor-market numbers are OK.”
A jump in auto sales last month is among the evidence that the world’s largest economy is rebounding from the damage caused by superstorm Sandy. Improving property values and falling fuel costs are helping brace consumers against the more than $600 billion in tax increases and government spending cuts that will take effect in January without action from Congress.
“There is a lot of nervousness about the fiscal cliff, so I think how that gets resolved will be important to what happens next,” O’Sullivan said.
Retail sales rose 0.3 percent last month after a 0.3 percent decrease in October, the Commerce Department reported last week. Ten of 13 major categories showed gains, led by a 1.4 percent increase at auto dealers, a 2.5 percent jump at electronics outlets and a 0.9 percent pickup at clothing stores.

China Signals Tolerance of Slower Growth After Meeting (Bloomberg)
China said it will seek a higher “quality and efficiency” of growth next year, signaling new leaders may accept a reduced pace of expansion in exchange for a more sustainable model.
There was no mention of seeking “relatively fast” growth, a policy in place since 2006, in a report yesterday by the state-run Xinhua News Agency after the annual central economic work conference in Beijing. Leaders vowed to target “sustained and healthy development” as they maintain a “prudent” monetary policy and “proactive” fiscal stance, Xinhua said.
Chinese leaders assuming power in a once-a-decade handover to be completed in March must decide the pace of market-driven change to boost consumer demand and rein in the role of exports and investment. Communist Party chief Xi Jinping, who made the case for restructuring during a visit to the southern Guangdong province this month, faces an economy likely to have grown this year at the weakest rate since 1999.
“Now the focus is firmly on reform for next year and the future,” said Shen Jianguang, Hong Kong-based chief Asia economist at Mizuho Securities Asia Ltd. “The key to watch is how fast the new leadership will proceed with the real tough structural change and reform. Many of these are easier said than done.”
Even so, “next year is considered a vital year for the new leadership,” so the government will not allow a so-called hard landing in growth, Shen said.

China Scraps QFII Limit on Sovereign Funds, Central Banks (Bloomberg)
China scrapped a ceiling on investments by overseas sovereign wealth funds and central banks in its capital markets, part of government efforts to encourage long-term foreign ownership and shore up slumping equities.
SWFs, central banks and monetary authorities can now exceed the $1 billion limit that still applies to other qualified foreign institutional investors, according to revised regulations posted Dec. 14 on the State Administration of Foreign Exchange’s website.
The Shanghai Composite Index (SHCOMP) jumped the most since October 2009 on Dec. 14 after the head of the Hong Kong Monetary Authority said Dec. 13 that China may relax or abolish a rule that requires Renminbi Qualified Foreign Institutional Investors to keep most of their funds in bonds. The China Securities Regulatory Commission has cut trading fees, pushed companies to increase dividends and allowed trust companies to buy equities since Guo Shuqing took over as chairman last year.
Introducing more long-term funds from abroad will help improve market confidence, promote stable growth in capital markets and provide “robust” investment returns to domestic investors, the regulator said in May, a month after the government more than doubled the total quota for QFIIs to $80 billion from $30 billion.
The benchmark Shanghai Composite has lost 2.2 percent this year, while the MSCI China Index of mostly Hong Kong-traded shares, open to overseas investors, has gained 18 percent as U.S. bond purchases spurred foreign funds to pour money into emerging markets.

Singapore’s Exports Unexpectedly Fell on Slump in Electronics (Bloomberg)
Singapore’s exports unexpectedly fell for the third time in four months in November as shipments of electronics slumped and companies sold fewer goods to U.S. customers.
Non-oil domestic exports fell 2.5 percent from a year earlier, after a 7.9 percent gain in October, the trade promotion agency said in a statement today. The median of 11 estimates in a Bloomberg News survey was for a 1.7 percent increase.
Singapore lowered its 2012 forecasts for export growth and economic expansion last month, as a global slowdown weighs on demand for its goods and services. A report last week showed U.S. companies are keeping inventories lean amid concern a recovery could stall if the country fails to avert a package of government spending cuts and tax increases set to take effect next year.
“We expect electronics exports to underperform in 2013,” Chester Liaw, a Singapore-based economist at Forecast Pte, said before the report. “We only expect a 2 percent rise in non-oil domestic exports over 2013, and that’s coming on the back of a series of low base effects in electronics.”
Singapore’s exports are forecast by the Trade Ministry to rise 2 percent to 3 percent in 2012, and as much as 4 percent next year.
Electronics shipments by companies such as Venture Corp. fell 16.5 percent in November from a year earlier, after slipping 0.8 percent the previous month, according to the report.
Non-electronics shipments, which include petrochemicals and pharmaceuticals, climbed 6.3 percent. Petrochemical exports gained 4.1 percent, while pharmaceutical shipments increased 29.6 percent after rising 2.7 percent in October.
Singapore’s non-oil exports fell a seasonally adjusted 0.3 percent last month from October, when they dropped 1.2 percent, today’s report showed.

Mario Monti’s Resignation May Slow Year of Euro Agreement (Bloomberg)
Italian Prime Minister Mario Monti’s looming resignation this week may threaten progress in fighting the three-year debt crisis even as European leaders wrap up the year with newly won breathing room.
Monti, under pressure from euro-area and business leaders to enter the Italian election campaign, plans to quit once parliament passes his budget this week. Former Prime Minister Silvio Berlusconi withdrew support from Monti’s government of non-politicians Dec. 6. The Italian upper house starts debate today on the budget, which will then pass to the lower house.
The European Union summit last week closed out a year in which policy makers bolstered the 17-nation single currency by setting up fiscal rules for indebted states, a permanent bailout fund, a central-bank bond-buying program and a road map for tighter banking and fiscal union. Work was overshadowed this month when Berlusconi pulled his support and pledged to return to power for the fourth time, only to backtrack as long as Monti forms what he called a “coalition of moderates.”
“None of the likely outcomes will derail last year’s reform process,” Erik Nielsen, London-based chief global economist at UniCredit SpA (UCG), wrote in a note to clients yesterday, referring to the Italian Italian election, which will probably be held in February. “That said, it requires close monitoring.”

European Union, Singapore Complete Free Trade Pact Negotiations (Bloomberg)
The European Union and Singapore concluded negotiations on a free-trade agreement after almost three years of talks, boosting the bloc’s efforts to increase commerce with Asian nations to revive economic growth.
The EU will eliminate tariffs on all imports from Singapore over five years, while the island will allow duty-free access for all incoming shipments from the region immediately, the city’s Ministry of Trade and Industry said in a statement today. The deal will help companies from both signatories to bid for government contracts in the other’s market.
“Both Singapore and the EU will make extensive commitments guaranteeing access to each other’s services markets,” the ministry said. The tariff removals “will benefit Singapore exporters of electronics, pharmaceuticals, chemicals, and processed food products.”
European and Asian leaders last month called for unfettered commerce and warned against protectionism as the sovereign debt crisis threatens to undermine trade ties between the world’s fastest and slowest-growing regions. The 27-member EU has seen talks lag with China, Japan, India and Southeast Asian countries since 2007. Negotiations with Singapore began in March 2010.
The International Monetary Fund forecasts the euro area’s economy will contract 0.4 percent this year, while that of the developing Asian region may grow 6.7 percent.
The EU suspended in 2009 trade talks with the 10-member Association of Southeast Asian Nations, a bloc with about 600 million people, and is now negotiating separate agreements with individual countries such as Malaysia and Vietnam. Similar discussions with India that kicked off in 2007 are stalled.

Gilts Fall as Reports Signal U.K. Economy Strengthening (Bloomberg)
U.K. government bonds fell this week, with 10-year yields rising the most since October, as data signaled the economic recovery is gaining strength, weakening the case for more bond-buying by the Bank of England.
Ten-year gilts dropped for a sixth straight day yesterday, the longest stretch of declines since October 2011. Standard & Poor’s lowered the U.K.’s credit-rating outlook to negative from stable on Dec. 13, citing weak economic growth and a worsening debt profile. An industry group yesterday predicted house prices will increase next year and a Bank of England official said the economy will improve in 2013.
“It’s more to do with the economy” rather than the rating outlook, said Annalisa Piazza, a strategist at Newedge Group in London, referring to the rise in yields. “The rating agencies are obviously concerned that there will be a cyclical impact on the fiscal consolidation given the reduced receipts because of the lower activity. That’s why they need to be alert.”
The 10-year gilt yield climbed 12 basis points, or 0.12 percentage point, this week to 1.86 percent at 5 p.m. in London yesterday. That’s the biggest increase since the period ended Oct. 19. The 1.75 percent bond due in September 2022 declined 1.06, or 10.60 pounds per 1,000-pound ($1,614) face amount, to 99.005.

Spanish Bonds Rise After Debt Sale, EU Agreement on Greek Aid (Bloomberg)
Spanish bonds advanced for a third week in four as borrowing costs fell at a debt sale and after European leaders signed off on the next aid tranche for Greece, stoking optimism the euro-region debt crisis is being contained.
Greece’s 10-year debt rose for a sixth week after the nation said it had reached a deal to buy back some of its sovereign securities. Similar-maturity German bunds fell as European Union leaders approved the payout of 49.1 billion euros ($64.3 billion) of loans for Greece through March and laying the groundwork for a supra-national bank supervisor, damping demand for the safest assets. Spain sold 2.02 billion euros of government debt.
“A lot of event risks have now passed, the Italian and Spanish bond auctions have gone through without any hiccups, the Greek tranche has been signed off and that paves the way for limited event risks for the remainder of the year,” said Orlando Green, a fixed-income strategist at Credit Agricole Corporate & Investment Bank in London. “The periphery is on a firmer footing as a result,” he said referring to lower-rated euro-area nations.
Spanish 10-year yields slid seven basis points, or 0.07 percentage point, in the week to 5.39 percent at 5 p.m. London time yesterday. The 5.85 percent bond due January 2022 rose 0.465, or 4.65 euros per 1,000-euro face amount, to 103.225. Two-year yields fell eight basis points to 2.88 percent.
German 10-year yields climbed five basis points to 1.35 percent as demand for the region’s safest assets waned.

20121217 1052 Global Commodities Related News.

Hedge Funds Reduce Bullish Bets by Most in a Month: Commodities (Bloomberg)
Hedge funds cut bullish commodity bets by the most in a month as the Federal Reserve warned the U.S. budget impasse may damage the economy, increasing concern about demand just as prices head for the first loss since 2008.
Speculators and money managers decreased net-long positions across 18 U.S. futures and options by 11 percent to 802,817 contracts in the week ended Dec. 11, U.S. Commodity Futures Trading Commission data show. Sugar holdings tumbled 68 percent, the most in five years, and those for wheat dropped to the lowest since June. Wagers on higher crude-oil prices tumbled 21 percent, the most since May.
The Standard & Poor’s GSCI Spot Index of 24 raw materials retreated 4.3 percent this quarter, with U.S. lawmakers in a stalemate on how to avoid about $600 billion in tax increases and spending cuts that start next month. The Fed “doesn’t have the tools” to counter the risks to the economy should there be no deal, Chairman Ben S. Bernanke said Dec. 12.
“The fact that the Fed is saying that there’s only so much they can do spooked people,” said John Stephenson, who oversees about $2.74 billion at First Asset Investment Management Inc. in Toronto. “They basically admitted that they don’t have what it takes to deal with the fiscal cliff, and it took the shine off the idea that unlimited money printing will help commodities.”
The S&P GSCI climbed 0.7 percent last week, paring its loss this year to 1.2 percent. The MSCI All-Country World Index of equities climbed 0.6 percent, and the dollar dropped 1 percent against a basket of six major trading partners. Treasuries lost 0.3 percent, a Bank of America Corp. index shows.

Wheat Market Recap Report (CME)
March Wheat finished up 5 1/2 at 814, 3 1/2 off the high and 7 3/4 up from the low. May Wheat closed up 5 at 826 1/4. This was 7 1/2 up from the low and 3 1/4 off the high.
March Chicago and KC wheat traded higher on the day with Chicago leading the way. Positive technical signals and thoughts that US Soft Red Winter wheat could see significant amounts of export demand soon helped to support the move. Thoughts that domestic feeders in the east may use more feed wheat in 2013 have added to the supportive tone. KC wheat was higher on the day but struggled to keep up with Chicago. Weather forecasts call for a modest rainfall in the west into this weekend which could help ease stress in some areas although much more precipitation will be needed this winter to stabilize the drought conditions. Heavy rainfall will be seen in areas of Wisconsin and Michigan over the next 3-5 days which should improve soil moisture profiles. The updated drought monitor shows the lower southeast, delta, and Carolinas are trending drier than normal and rainfall is needed. Missouri, western Illinois, and fringe areas of Kentucky and Tennessee are seeing drought stress which will need to be monitored as we move through winter.
March Oats closed up 2 3/4 at 389 3/4. This was 5 1/2 up from the low and 5 off the high.

Corn Market Recap for 12/14/2012 (CME)
March Corn finished up 10 1/2 at 730 3/4, 1 off the high and 13 up from the low. May Corn closed up 9 3/4 at 733 3/4. This was 12 up from the low and 1/4 off the high.
March corn traded higher to finish out the week on firm interior cash markets and buying support showed up on thoughts the market had drifted low enough the last couple of days. Newswires reported this morning that 2 containers of corn from Argentina were being held at a Chinese port after officials detected GMO strains that have not been approved. Chinese officials noted that no further corn can enter the country until the situation is resolved. If the situation drags out, this could shift demand to other suppliers like Ukraine or the US. Corn bids on the river and Gulf of Mexico were steady to lower on poor export demand and as barge freight values weakened. Good rainfall over the next 7-10 days for most of Brazil and Argentina should dry down during this period. Both countries should see stable temperatures, which should promote good conditions for row crops and move along the planting pace.
January Rice finished down 0.08 at 15.42, 0.06 off the high and equal to the low.

Rubber Surges to Seven-Month High as Yen Weakens on Abe Victory (Bloomberg)
Rubber surged to a seven-month high after Japan’s Liberal Democratic Party reclaimed power, weakening the Japanese currency on expectations for further stimulus and boosting the appeal of yen-denominated contracts.
The contract for delivery in May advanced as much as 2.3 percent to 282.8 yen a kilogram ($3,369 a metric ton), the highest level since May 14, and traded at 281.6 yen on the Tokyo Commodity Exchange at 10:32 a.m. Futures climbed 6.9 percent this year, rebounding from a 36 percent drop in 2011.
Shinzo Abe’s LDP captured 294 seats in the 480-member lower house of parliament in elections yesterday, while Prime Minister Yoshihiko Noda’s Democratic Party of Japan lost three-fourths of its lawmakers, according to public broadcaster NHK’s vote count. The yen fell to 84.48 per dollar, the weakest since April 2011.
“Investors are betting the Bank of Japan will decide to take additional measures at this week’s meeting after the LDP’s landslide victory,” Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo, said today by phone.
The LDP returned to power after three years following a pledge to achieve nominal economic growth of 3 percent and set an inflation target with the central bank of 2 percent.
The BOJ expanded its fund to buy assets such as government bonds and corporate debt by 11 trillion yen to 66 trillion yen in October. Its board will meet Dec. 19-20.
Thai rubber free-on-board added 0.5 percent to 94.1 baht ($3.07) a kilogram on Dec. 14, according to the Rubber Research Institute of Thailand.

Recap Energy Market Report (CME)
January crude oil prices trended higher for most of the session but struggled to extend early morning gains into new high territory. Early support for the market came on a better than expected read on Chinese Manufacturing, as well as US Industrial Production figures. Some traders pointed to weakness in the US dollar as a factor contributing added support. However, weakness in equity markets and lingering uncertainty over the US fiscal cliff might have kept the upside limited.

Oil Rises Second Day on Speculation U.S., China to Boost Demand (Bloomberg)
Oil rose for a second day in New York after capping the fifth weekly gain in six as signs of economic growth in the U.S. and China stoked speculation fuel demand will grow.
Futures advanced as much as 0.6 percent after the Federal Reserve reported Dec. 14 that industrial output in the U.S. climbed by the most in two years in November. A preliminary purchasing managers’ index showed manufacturing in China expanding at a faster pace this month. Syrian fighter jets bombed a Palestinian camp in Damascus, reviving concern that unrest in the Middle East may spread to oil-producing countries.
“A positive outlook for global growth is confirmed by those numbers out of the U.S. and China,” said Michael McCarthy, a chief market strategist at CMC Markets in Sydney. “That’s also supportive of oil prices around the globe.”
West Texas Intermediate crude for January delivery was at $86.95 a barrel, up 22 cents, in electronic trading on the New York Mercantile Exchange at 9:41 a.m. in Tokyo. Front-month prices advanced 84 cents, or 1 percent, to settle at $86.73 a barrel Dec. 14.
Brent for February settlement advanced 4 cents to $108.22 a barrel on the London-based ICE Futures Europe exchange. The January contract settled $1.24 higher at $109.15 when it expired Dec. 14. The European grade was at a premium of $20.79 to WTI.

Silver Market Recap Report (CME)
March silver were able to consolidate above yesterday's low for the move but could only posting a mild gain by the end of Friday's trading. A lower than expected reading for the US CPI this morning may have boosted fears of deflation, which many in the market saw as weighing on silver prices during the later stages of today's trading. A sizable pullback in the Dollar did provide some measure of support for silver prices, and likely played a major role with March silver being able hold within positive by the close of trading.

Gold Market Recap Report (CME)
The gold market found relatively subdued trading during Friday's session, as prices remain close to unchanged levels for a large portion of the trading day. For the week, February gold finished with a loss of 8.50. A positive reception for Chinese manufacturing data during overnight trading as well as for US Industrial Production this morning were widely felt to have given a boost to global market risk sentiment but the gold market ultimately found little lasting benefit going into the weekend. A major global brokerage firm lowered their outlook for gold prices during 2013, however, which may have put additional pressure on the market early on during today's session. Lukewarm US equity markets in the wake of today's US inflation data were also seen as a key negative factor for gold prices during the session.

20121217 1050 Soy Oil & Palm Oil Related News.

ITS CPO export down 6.4% to 719,817 tonnes for the period of 1~15 Dec 2012.

Soybean Complex Market Recap (CME)
January Soybeans finished up 19 1/2 at 1496, 1 off the high and 21 3/4 up from the low. March Soybeans closed up 19 at 1491 1/2. This was 21 1/4 up from the low and 1 off the high.
January Soymeal closed up 2.4 at 457.7. This was 3.1 up from the low and 2.6 off the high.
January Soybean Oil finished up 0.99 at 49.99, 0.08 off the high and 1.08 up from the low.
January soybeans traded 18 higher on the day after the market saw another round of strong demand side data. November NOPA crush came in at 157.308 million bushels, in line with market estimates and was the largest monthly crush rate in 3 years. The strong crush and export demand continues to support the market but January futures are holding steady in their recent trading range. Crush margins have improved in China the last couple of weeks which has triggered a flurry of soybean purchases from the US. No big changes to South American weather at the moment. Good rainfall over the next 7-10 days for most of Brazil and Argentina should dry down during this period. Both countries should see stable temperatures which should promote good conditions for row crops and move along the planting pace. The strong cash markets and calendar spreads added a positive tilt to the market throughout the day which helped support the move higher.

EDIBLE OIL: Malaysian palm oil futures rebound from the previous day's three-year low but prices still posted their fourth consecutive weekly loss as worries persisted over record high stocks. (Reuters)