Trader's Comment: Malaysia CPO futures ended in a fresh two-years low again

Malaysia CPO futures ended in a fresh two-years low again amid a general sell off in commodities, primarily led by falling crude oil prices. Benchmark Jan09 initially open RM27 lower at 1625, tracking overnight NYMEX crude oil prices tumbled 4 percent as investors worries that production cut by OPEC might not be enough to offset weakening energy demand caused by global recession. Almost 200 points down in rival soy oil overnight also added selling pressures, this sent Benchmark Jan09 prices kept on falling without much turning back until it hit intra day low at 1542 in the afternoon session. This was mainly driven by the fell of crude oil prices that had drop more than $3 a barrel to below $70 level during Asian time trading. Later, some intra day short covering activities emerged and caused Benchmark Jan09 to bounce back a little and hover around 1580-1550 levels, before it settling at 1565, down RM 87. Market sentiment remains weak.