Trader's Comment: Palm oil futures made an unexpected “U Turn” as it bounced back strongly from yesterday’s heavy losses on aggressive covering.

Palm oil futures made an unexpected “U Turn” as it bounced back strongly from yesterday’s heavy losses on aggressive covering. Benchmark Sep09 opened only slightly lower at 2150 despite the overnight NYMEX crude oil closed sharply lower. It then began to rise strongly through out the day until it hit the intra day high of 2299 before finally ended RM129 higher at 2286. Aggressive short covering activities were seen since early trading, as traders believed that yesterday’s market sold down had been overdone. External markets were rather volatile and mix today. Dalian palm inched lower while eCBOT soy oil edged more than 1% higher. Meanwhile, Asian time crude oil had been hovering around USD67 level.

Trader's Comment: Palm oil futures posted 3 digit losses to tumble more than 5% lower on weaker external market.

Palm oil futures posted 3 digit losses to tumble more than 5% lower on weaker external market. Benchmark Sep09 immediately gapped down RM39 to open at 2246 following overnight NYMEX crude oil down more than 2%. It merely hit the intra day high of 2265, unable to cover fully on its previous session left over gap and there after started to fell through out the rest of the day until it finally ended RM128 lower at 2157. The bearish external markets had weighed on the already fundamentally weak CPO market as palm oil production is expected to be much higher in the second half of the year. Asian time NYMEX crude oil extended its overnight sharp losses to fall more than $1 trading below $69 and led Dalian palm and eCBOT soy oil to follow suit, as both fell more than 1%. The results of 1-20 June export data released by both private cargo surveyors were within the market expectation after ITS & SGS reported a decline of 3.4% and 4.1% respectively.

Trader's Highlight

DJI-NEW YORK, June 22 (Reuters) - U.S. stocks suffered their worst one-day loss in two months, dropping the S&P 500 back into negative territory for the year on Monday in a broad-based sell-off, as investors reconsidered the health of the economy

Underscoring worries about the economy's outlook, the World Bank said prospects for the global economy remain "unusually uncertain" as it cut 2009 growth forecasts for most economies.

The Dow Jones industrial average <.DJI> dropped 200.72 points, or 2.35 percent, to end at 8,339.01. The Standard & Poor's 500 Index <.SPX> was down 28.19 points, or 3.06 percent, at 893.04. The Nasdaq Composite Index <.IXIC> was down 61.28 points, or 3.35 percent, at 1,766.19.

NYMEX-NEW YORK, June 22 (Reuters) - U.S. crude oil futures fell on Monday, slumping almost 4 percent as a stronger dollar, weaker equities and liquidations as front-month July contract headed to expiration combined to pressure oil prices.

On the New York Mercantile Exchange, July crude expired and settled down $2.62, or 3.77 percent, at $66.93 a barrel, trading from $66.25 to $69.89. The day's low was the lowest since June 4's $65.92.

CBOT-SOYBEANS - July down 27-1/2 cents at $11.51-1/2 a bushel. November down 25 cents at 9.81 a bushel.

Soybeans fell to near four-week low as weak-handed longs bail with weak crude oil futures, improved crop weather, and prospects for jump in U.S. soy acreage.

CBOT-SOYOIL - July down 0.60 cent at 35.93 cents per lb. Weak crude, soybeans pressuring market.

FCPO-KUALA LUMPUR, June 22 (Reuters) - Malaysian crude palm oil futures dropped as much as 5.1 percent on Monday as weaker oil prices weighed on global vegetable oil markets.

The benchmark September contract on the Bursa Malaysia Derivatives Exchange fell 116 ringgit to 2,169 ringgit ($613) per tonne.

REGIONAL EQUITIES-BANGKOK, June 22 (Reuters) - Most Southeast Asian stock markets fell on Monday, with losses in energy-linked heavyweights such as Sime Darby helping push Malaysia to a three-week low and PTT Exploration and Production leading falls in Thailand.

Malaysia's main stock index <.KLSE> dropped 1.3 percent, after earlier falling as much as 1.8 percent to its lowest since May 29, with Sime Darby sliding 2.1 percent and Petronas Gas off 1 percent.

Singapore's index <.FTSTI> inched down 0.3 percent, erasing a 1.35 percent gain to a one-week high in morning trade. The Jakarta index <.JKSE> fell 0.8 percent, with Bank Rakyat down 3.3 percent and Adaro Energy off 4.8 percent. Vietnam <.VNI> fell for a second day, ending down 3.6 percent, led by a 5 percent fall in PVFC , the financial arm of state oil group Petrovietnam.

DJI Daily: Cautious

Market losing ground with a triple digit losses. We are now looking for the downside support at 8200-8000. Violation of it may provide more downside room. To the upside, resistance is at 8600-8000 followed by 9000.

KLSE Daily: Weak

Market momentum turns weak and looks more room to bias downside potential. Currently, we are looking for the immediate support 1035-1030 followed by 1000. While, upside resistance is stood at 1060-1065.

FKLI Daily: More downside potential

Market continue to losing streak following the violation of 1045-1050 had further dampened the immediate landscape. Thus, we foresee more potential of downside room in near term market. We are now looking for the immediate support at 1035-1030 followed by 1000. To the upside, resistance is at 1065-1070.

FCPO Daily: Bear dominated

Bear is dominated the market momentum with clouded by a long black candle. Market looks likely to extend its bearish territory in near term. Currently, we are looking for the downside support at 2120-2100 followed by 2060-2050. To the upside, resistance is at 2265-2274 (gap left over on 22/6/2009)