Trader's Comment: Palm oil futures ended lower on weak crude oil prices.

Palm oil futures ended lower on weak crude oil prices. Trading were mix initially as Benchmark Oct09 closed unchanged at the end of morning session after hovering between 2132-2158. However, the late sell-down on Shanghai’s stock market had spread the gloomy and weak sentiment to the regional equity market which some how or rather spilled over into BMD. This had also provided the excuse for the long to book profit after last 2 days of rebound. Benchmark Oct09 immediately fell lower after second session resumed trading and slid to intra day low of 2109 before it settled RM27 lower at 2113 due to further weakening of Asian time NYMEX crude oil. Daily volume was moderate with a total of 15,366 contracts changed hands.

Breaking News-RTRS-China banks to slow lending with low targets -media

BEIJING, July 29 (Reuters) - China's two biggest state-owned commercial banks have put a lid on their 2009 lending targets, according to domestic media reports, in a move that will significantly slow overall Chinese credit growth in the second half.
Industrial and Commercial Bank of China (ICBC) <1398.HK> is aiming to issue full-year new loans of 1 trillion yuan ($146.4 billion), while China Construction Bank (CCB) <0939.HK> has set a goal of 900 billion yuan, Caijing magazine reported.
The two banks, China's largest by market value, granted new loans of 825.5 billion yuan and 709 billion yuan, respectively, in the first half.
If they stick to their reported targets, this would imply that ICBC <601398.SS> would have already issued 83 percent of its full-year lending total, while CCB <601939.SS> would have already issued 79 percent.
Overall, Chinese banks issued a record 7.37 trillion yuan in new loans in the first six months, easily topping the full-year figure of 4.91 trillion yuan in 2008 and igniting concern that excess liquidity was leading to stock and property bubbles.
Chinese regulators have left banks largely unhindered in their rampant lending in the belief that the economy needs ample money to recover, but in recent weeks they have warned of mounting credit risks to the banks themselves and demanded that loans be put to use for productive purposes.

Breaking News-RTRS-UPDATE 1-China's 2nd state soybean sale ends with no bids

BEIJING, July 29 (Reuters) - China's second attempt to sell 500,000 tonnes of soybeans from its state reserves has ended without any bids being made, according to the National Grain & Oil Trade Center.
At 3,750 yuan ($549) per tonne, the minimum bidding price was about 200 yuan above the spot market price, and was unchanged from the auctions held last Thursday, which also ended without any sales.
Analysts say the government will have to consider reducing prices or subsidising crushers if it is to have any hope of selling off enough of its reserves to make space for the new harvest, due in September.

Trader's Highlight

DJI-NEW YORK, July 29 (Reuters) - U.S. stocks fell on Wednesday as investors worried that China might be ready to hit the brakes on lending, a move that could curb demand and hinder the global economic recovery.

Concerns about China hurt commodity prices and hit shares in the energy and raw materials sectors, while a steep drop in U.S durable goods orders in June fed fears of more economic weakness.

China's two biggest state-owned commercial banks have put a lid on their 2009 lending targets, according to domestic media reports, a move that will significantly slow overall Chinese credit growth in the year's second half.

Further weighing down stocks, yields of shorter-dated U.S. Treasuries briefly hit five-week highs after the week's second poor auction, increasing concern of a possible spike in borrowing costs.

The Dow Jones industrial average <.DJI> dropped 26 points, or 0.29 percent, to close at 9,070.72. The Standard & Poor's 500 Index <.SPX> fell 4.47 points, or 0.46 percent, to 975.15. The Nasdaq Composite Index <.IXIC> lost 7.75 points, or 0.39
percent, to 1,967.76.

NYMEX-NEW YORK, July 29 (Reuters) - U.S. crude oil futures ended down more than 5 percent, the biggest single-day percentage loss for front-month crude since April, as government data showed a surprisingly large build in crude oil inventories last
week.

The data defied analysts' forecasts for a stock drawdown and confirmed the American Petroleum Institute's report late Tuesday that crude stocks rose sharply last week.

On the New York Mercantile Exchange, September crude settled down $3.88, or 5.77 percent, at $63.35 a barrel, trading from $63.04, the lowest since the July 17 low of $61.04, to $67.01. In post-settlement trading, the day's low extended to $62.70 by 1926 GMT. The loss was the biggest percentage loss for a day for front-month crude since April 20's 8.84 percent fall.

CBOT-SOYBEANS - August up 3 cents at $10.57-1/2; November down 11 at $9.16.

August turns up on tight stocks, bucking the lower trend in the backs. Exporters and processors compete for soybeans to meet nearby commitments. Deferreds pressured by near perfect conditions for flowering and pod setting soybeans, falling crude, firmer dollar.

China's second state soybean sale ends with no bids. The China sale was rumored on Tuesday, sparking the CBOT to rally

CBOT-SOYOIL - August down 0.75 at 33.07 cents per lb. Lower crude oil, firm dollar and falling equities markets pressure soyoil.

Monsoon in India weakens, leading to potential limited rainfall in soybean areas over the next 5 days or longer.

FCPO-JAKARTA, July 29 (Reuters) - Malaysian crude palm oil futures fell 1.3 percent on Wednesday after hitting a one-week intraday high on profit taking as falling stock markets and crude oil prices dampened sentiment, traders said.

The benchmark October contract on Bursa Malaysia's Derivatives Exchange settled down 27 ringgit to 2,113 ringgit ($598.41) per tonne, after going as high as 2,158 ringgit early in the day, a level not seen since July 21. Overall volume was at 15,366 lots of 25 tonnes each.

REGIONAL EQUITIES-BANGKOK, July 29 (Reuters) - Major Southeast Asian stock markets fell on Wednesday, ending their recent rally, as investors took profits on banking shares such as Singapore's DBS Group, Thailand's Bangkok Bank and Malaysia's Public Bank.

Singapore's index <.FTSTI> lost 0.8 percent, snapping a four-session gain, with DBS Group , Southeast Asia's biggest lender, sliding 2.6 percent, Oversea-Chinese Banking Corp inching down 0.4 percent and United Overseas Bank dropping 2.9 percent. The three banks could post sharp declines in second-quarter profits, hit by bad debt charges and lower trading income. They release quarterly earnings on Aug. 3-7.

Malaysia's index <.KLSE> ended down 0.7 percent, with Public Bank down nearly 1 percent and palm plantation firm IOI Corp 2 percent lower.

KLSE Daily: still BULLISH

Bears attack did not have much impact to the current bullish outlook. Thus, we still stick to our bullish view in near term. Upside resistance maintain at 1190-1200 level. For downside, support is stood at 1150-1140.

FKLI Daily: Bulls defended well.

Bulls defended well and managed to sustain from the bears attack. We maintain our bullish view in near term and bulls likely to challenge 1200 mark in near term. While, downside support is pegged at 1150-1145.

NYMEX CRUDE OIL Daily: Heavy TOP

Market looks tiredness to maintain its upward posture following a long black candle printed on daily chart. This had weighed on the immediate technical landscape. Thus, market may move sideways bias to downside potential in near term. As for now, we are looking for the overhead resistance at 68.99. While, underline support is pegged at 58.32.

FCPO Daily: Facing tough resistance

Market gave up early gains after facing tough resistance at around 2160 level. Hence, market is likely enter back to consolidation zone in near term with immediate upside resistance at 2162 followed by 2184. To the downside, immediate support is pegged at 2100-2080 followed by 2060-2050.