Trader's Comment: Lower inventory released by MPOB led CPO futures to finish generally higher

Lower inventory released by MPOB led CPO futures to finish generally higher. Players were discounting lower 1-10 Jan09 export figures released by private cargo surveyors. MPOB put palm oil stocks in December08 fall 11.98% to 1.99 million tonnes from a revised 2.26 million tonnes in November08. This provided some confidence to the bull as end-stocks below 2million. Private cargo surveyors released their 1-10 Jan09 export figures were more or less within market expectation and ignored by market players, SGS pegged 1-10 Jan09 export down 37% at 384,842 from Dec08 at 619,180 tonnes. Last Friday’s strong closed at soy complex in CBOT provided a positive tone to BMD a good start in the early session. Benchmark Mar09 finally settled RM68 higher at 1988 after trading between 1935 to 1988.

Breaking News-RTRS-China doubles domestic soy purchase, buys more rice

BEIJING, Jan 12 (Reuters) - China will double its purchases of domestic soybeans by buying an additional 3 million tonnes for state reserves in a bid to shore up domestic prices, according to an official annoucement posted on a government Web site on Monday.
China's earlier purchases had prompted many crushers shift to cheap U.S imports.
The government will also expand its purchases of rice, buying an additional 5 million tonnes of rice for reserves, according to the statement posted on the central government Web site (http://www.gov.cn/gzdt/2009-01/12/content_1202534.htm).

Trader's Highlight

DJI-NEW YORK, Jan 9 (Reuters) - U.S. stocks fell on Friday after government data showed the labor market deteriorated further in December, raising investor concerns about the outlook for profits, spending and a deepening recession.

The Dow Jones industrial average <.DJI> ended down 143.28 points, or 1.64 percent, to 8,599.18. The Standard & Poor's 500 Index <.SPX> slid 19.38 points, or 2.13 percent, to 890.35. The Nasdaq Composite Index <.IXIC> fell 45.42 points, or 2.81
percent, to 1,571.59.

U.S. employers slashed 524,000 jobs from payrolls in December, less than the 550,000 seen in a Reuters poll, but still bringing total job losses for 2008 to 2.6 million, the most since 1945.

NYMEX-NEW YORK, Jan 9 (Reuters) - U.S. crude oil futures ended down for the third straight session on Friday as demand worries persisted after December jobless data showed that the national unemployment rate rose to the highest level in 16 years.

Losses were pared near the close in a spurt of pre-weekend short-covering and as signs pointed to a possible resolution to the Russia-Ukraine contract dispute over natural gas.

On the New York Mercantile Exchange, February crude settled down 87 cents, or 2.09 percent, at $40.83 a barrel, trading from $39.38 to $42.70. For the week, prices fell $5.51, or 11.89 percent.

CBOT-SOYBEANS - January up 48-1/2 cents at $10.37-1/2 a bushel, March up 46-1/2 at $10.36. Forecasts for hot and dry weather in Argentina and in several key crop areas of Brazil rally soybeans. Soy climbs despite falling crude oil and U.S. stock market.

CBOT-SOYOIL - January up 0.98 cent at 36.50 cents a lb, March up 0.94 at 36.72. Lifted by strength in soybeans amid South American crop weather concerns.

FCPO-JAKARTA, Jan 9 (Reuters) - Malaysian palm futures rose on Friday, but came off their highs in late trade amid caution over export performance.

The benchmark March palm oil contract on the Bursa Malaysia's Derivatives Exchange closed up 55 ringgit, or 3.0 percent, at 1,920 ringgit ($5) per tonne, off an intra-day high of 1,948 ringgit.

Other traded contracts rose between 15 ringgit and 48 ringgit. Overall volume was 15,133 lots of 25 tonnes each.

REGIONAL EQUITIES-Southeast Asian markets ended mixed ahead of U.S. job data.
Singapore's Straits Times Index <.FTSTI> fell 1.2 percent to a one-week low, with banks leading decliners.

Malaysia ended higher, its index <.KLSE> adding 0.9 percent, with palm plantation firm IOI Corp up 0.5 percent as Malaysian palm futures rose after a rebound in crude oil.

DJI Weekly: Holding ground

Market remains to hold ground and move in sideways manner. Consolidation phase looks likely to continue in near term market. Resistance and support is at 9284-9159 and 8347-8372 level respectively.

KLSE Weekly: Firm above 900 mark

Market momentum strengthened further following market manage to stay firm above 900 mark. We maintain our sideways to higher view in near term market. As for now, we are looking for the upside resistance at 963. Downside support is pegged at 901-897 (gap left over since 4/1/2009).

FKLI Weekly: Sideways to Higher in near term.

Market extended its wining streak with another long white candle printed. Chart wise, market looks may continue its sideways to higher move in near term market. Currently, we look for the resistance at 960. downside support is pegged at 903.5-901 (gap left over since 4/1/2009).

FCPO Weekly: Bottoming Out

Market surged to cover the full gap at 1902-1934 had given sign of bottoming out. Market looks may continue to move higher with upside target at 2200-2235 for near term market. While, downside support remains at 1625-1596 (gap left over since 28/12/2008).