Thursday, August 21, 2008

Trader's Comment:Strong external factors led CPO futures to climb higher

Strong external factors led CPO futures to climb higher and trade above 2600 level. Positive rival soyoil prices trading in e-CBOT and steady crude oil as well as strong finish in Dalian provided the friendly sentiment at closed. Benchmark Nov08 settled RM62 higher at 2653 after trading between 2606 to 2672.

Rebound continue in FCPO

FCPO rebound further to stay above 2600 mark. Looks market may want to challenge the upside resistance at 2728-2767 (gap left over on 8-11th Aug, 2008). For downside, support is pegged at 2606-2594 (gap left over today).

FKLI trade in tight range

Market looks may extend its range bound trading between 1045.5-1070.

KLSE remained sideways move

Nothing much changes on the immediate daily technical outlook as prices remained in sideways move. Underlined support at 1050 defended well so far. For upside, resistance maintained at 1108-1111.

FCPO rebound further

FCPO rebound further to stay above 2600 mark. Market looks may want to challenge 2700 barrier. For downside, immediate support is at 2606-2594 (gap left over this morning).

FKLI stuck in range trading

FKLI stuck in the range between 1070-1046.5.

KLSE in consolidation mode

KLSE in range bound trading. We continue to look for immediate resistance and support at 1082-1083 and 1064.5-1065.5 level respectively.

Breaking news-RTRS-Pakistan Palm Oil Cash Mkt Defaults Likely Low -Exec

KUALA LUMPUR (Dow Jones)--Pakistan's defaults and washed out palm oil purchase contracts in the past two weeks were unlikely to have involved large volumes, according to a senior industry executive.

The total would "have been a maximum of 40,000 tons," Nasir Ibrahim, director of Sadiq Vegetable Ghee Mills, a Lahore-based firm, said late Tuesday.

Last week, exporters in Malaysia and Indonesia estimated Pakistan buyers renegotiated or washed out contracts totaling nearly 100,000 tons for shipment mostly between August and December.


Trader's Highlight

DJI-NEW YORK, Aug 20 (Reuters) - U.S. stocks rose on Wednesday as bank and energy shares rebounded even as investors dumped Fannie Mae and Freddie Mac on fears of an imminent government bailout of the housing finance companies.The Dow Jones industrial average <.DJI> was up 68.88 points, or 0.61 percent, at 11,417.43. The Standard & Poor's 500 Index <.SPX> was up 7.85 points, or 0.62 percent, at 1,274.54. The Nasdaq Composite Index <.IXIC> was up 4.72 points, or 0.20 percent, at 2,389.08.

NYMEX-NEW YORK, Aug 20 (Reuters) - U.S. crude oil futures ended higher on Wednesday on geopolitical worries following news of Russia's potential response to a the U.S.-Poland missile shield deal and news of a big drawdown in gasoline stocks.On the New York Mercantile Exchange, September crude expired and settled up 45 cents, or 0.39 percent, at $114.98 a barrel, after trading from $112.61 to $117.03.

CBOT-SOYBEANS - September up 26-3/4 cents at $12.93-3/4 per bushel, new-crop November up 24 at $13.00.Rallying on drier-than-desired crop weather in the Midwest
as the U.S. soybean crop continues its key pod-setting growth phase. Higher Asian vegoil markets and Argentine farm protests lend additional support.

SOYOIL - September up 0.69 at 53.07 cents per lb.Support from gains in soy.

FCPO-KUALA LUMPUR, Aug 20 (Reuters) - Malaysian crude palm oil futures jumped 6.5 percent on Wednesday to a one-week high but the outlook remained uncertain due to an upswing in production and talk of more defaults.The benchmark November contract on the Bursa Malaysia Derivatives Exchange rose as much as 158 ringgit to 2,594 ringgit ($779) per tonne, a level unseen since Aug. 14. The contract then settled up 2,591 ringgit.

REGIONAL EQUITIES-SINGAPORE, Aug 20 (Reuters) - Most Southeast Asian markets edged higher on Wednesday, rebounding from year-lows as gains in Chinese shares outweighed credit fears, but Thailand was weighed down by banks.

Chinese <.SSEC> shares surged on hopes Beijing would introduce a stimulus package, dragging Hong Kong <.HSI> higher and boosting equities around the region.

The Singapore index <.FTSTI> rose 0.9 percent, while Jakarta <.JKSE> added 1.3 percent, boosted by resource stocks. Malaysia<.KLSE> edged 0.4 percent up but Thai stocks <.SETI> dipped 0.2 percent.

DJI may continue to trade sideways to lower

DJI may continue to trade sideways to lower. We continue to look for the support at 11221-11210. For upside, resistance is at 11690-11700.

Trader's comment:CPO futures prices reversed from yesterday losses to end triple digit higher

CPO futures prices reversed from yesterday losses to end triple digit higher. Gains in overnight NYMEX crude oil coupled with retreat in USD/MYR had helped to underpin the market sentiment. Support also stemmed from stronger China’s Dalian commodities market and e-CBOT in Asian trading zone. Benchmark Nov 08 hit the intra-day low at 2467 after the opening bell at 2495, up RM 59. It then recovered to trigger 2526 before midday closing in positive territory at 2520. 1-20th August export data released by private cargo surveyors were within market expectation. ITS pegged at 904,645 mt, up 8.5% whereas SGS put at 856,806 mt, up 7.8% compare the same period of last month. Short covering interest saw Nov 08 inching up higher in afternoon session following comments from Thomas Mielke editor-in-chief of Oil World, a Hamburg-based vegetable oils publication. He comments CPO prices are undervalued and not in line with fundamentals, and should recover in medium term. Nov 08 then rose to the high at 2594 before settling at 2591, up RM 155 with total volume stood at 13,040 contracts changed hands.