Trader's Comment's: Palm oil futures recouped some of its earlier losses to end slightly lower

Palm oil futures recouped some of its earlier losses to end slightly lower. Benchmark Feb 09 initially opened RM35 lower at 1593 and slid to the intra day low at 1560, tracking overnight NYMEX crude oil which ended 3-1/2 year low as OPEC delayed their decision to cut output, coupled with easier CBOT soy complex. However, CPO prices were still well supported as short covering activities and bargain-hunting buyers took action ahead of a palm oil conference to be held in Bali tomorrow. Benchmark Feb09 the hovered between 1565-1585 level for most of the sessions. Some late intra day short covering saw prices recovered to the day high of 1614 before settling at 1603. The events of heavy rain fall and some flooding at Sabah and Sarawak were also taking into consideration by players.

Breaking News-China soy plants in top soy area stop work, may import

BEIJING, Dec 1 (Reuters) - Major soy crushing plants in Heilongjiang province, China's largest soybean area, have halted operations and are considering imports for the first time, thanks to a state plan to support local farmers by stockpiling domestic crops, local officials and traders said on Monday.

Breaking News-China sees 08 grain output at record 525 mln T-Xinhua

BEIJING, Dec 1 (Reuters) - China is expected to have a fifth straight year of bumper harvests this year, with output at a record 525 million tonnes, up 5 percent from 2007, but that level is unlikely to be topped next year due to falling grain prices, the official Xinhua news agency said on Monday, citing a top economic planning official.

Trader's Highlight

DJI-NEW YORK, Dec 1 (Reuters) - U.S. stocks tumbled on Monday as signs of a deepening economic slump around the world erased much of last week's sharp gains, with banks and retailers among Wall Street's biggest casualties.

Adding to the market's woeful day, the arbiter of U.S. business cycles declared that the United States entered recession in December 2007 and Federal Reserve Chairman Ben Bernanke said the U.S economy remained under considerable strain.

The Dow Jones industrial average <.DJI> dropped 679.95 points, or 7.70 percent, to end at 8,149.09. The Standard & Poor's 500 Index <.SPX> slid 80.03 points, or 8.93 percent, to 816.21. The Nasdaq Composite Index <.IXIC> lost 137.50 points, or 8.95 percent, to 1,398.07.

NYMEX-NEW YORK, Dec 1 (Reuters) - U.S. crude oil futures settled at a fresh 3-1/2-year low on Monday, after OPEC's weekend decision to defer any further output cut until mid-December.

On the New York Mercantile Exchange, January crude settled down $5.15, or 9.46 percent, at $49.28 a barrel, the lowest settlement since prices ended at $49.16 on May 23, 2005.

CBOT-SOYBEANS - January down 37 cents at $8.46 per bushel.

Soy down 4 percent to a 1-week low on falling stock markets, crude oil and gold, along with a firm dollar. Further pressure from rainfall in Argentina and some showers in portions of the drier areas in Brazil.

USDA reported export inspections of U.S. soybeans in the latest week at 37.5 million bushels, within trade estimates for 33 million to 38 million.

CBOT-SOYOIL - December down 1.47 cents at 31.11 cents per lb, January down 1.50 at 31.40.

Falling crude oil, stock markets and gold amid a firm dollar drag soyoil down 5 percent.

FCPO-KUALA LUMPUR, Dec 1 (Reuters) - Malaysian palm oil futures edged lower on Monday as sharp declines in crude oil markets offset fears that heavy rainfall and floods in key producing areas would hit output.

Talk of a possible slowdown in production as wet weather discourages harvesting could in the coming days support prices of palm oil, which are down nearly two-thirds from a record high of 4,486 ringgit per tonne in March as the global financial crisis roils commodity markets.

Benchmark February palm oil contract on the Bursa Malaysia's Derivatives Exchange settled down 4 ringgit at 1,628 ringgit ($449.6) per tonne after going as high as 1,675 ringgit.

Other traded months dropped between 4 and 50 ringgit <0#KPO:>. Overall trade rose to 13,054 lots of 25 tonnes each from 10,000 lots.

REGIONAL EQUITIES-BANGKOK, Dec 1 (Reuters) - Southeast Asian stock markets fell
on Monday as early support from Wall Street's best week in 30 years gave way to profit-taking as investors feared another global sell-off in equity markets was near.

Thailand's benchmark index <.SETI> led losers, surrendering early gains and ending 2.7 percent lower after Standard & Poor's cut its country outlook to negative from stable.

Singapore fell 2.44 percent, while Malaysia <.KLSE>, which has been outperforming the region, lost 2.04 percent. Indonesia <.JKSE> snapped a four-day winning streak, declining 1.48 percent.

FCPO Daily: stabilising

Market looks stabilising following prices remains firm. We now look at the immediate support at 1586-1573 followed by 1556-1539. For upside, immediate resistance is at 1692-1696 followed by 1723-1727.

FKLI Daily: critical support at 842-843

A dip below the critical support at 842.5-843 would trigger more aggressive selling pressure. We put the next support at 827.5. For upside, immediate resistance is at 868-871.5.

KLSE Daily: struggling to hold

Market is struggling to hold up the critical support at 848 level. We now look at the support at 826. For upside, resistance is at 869.

DJI Daily: TUMBLED !!

DJI failed to hold ground following market drop more than 7% had swept away the earlier gains. Market looks facing resistance at 8831-8827 level. for downside, support is pegged at 8048-8071 followed by 7965.