DJI - NEW YORK, Feb 26 (Reuters) - U.S.
stocks rebounded from their worst decline since November on Tuesday after
Federal Reserve Chairman Ben Bernanke defended the Fed's bond-buying stimulus
and sales of new homes hit a 4 1/2-year high.
The S&P 500 had climbed 6
percent for the year and came within reach of all-time highs before the minutes
from the Fed's January meeting were released last Wednesday. Since then, the
benchmark S&P 500 has fallen 1 percent.
Bernanke, in testimony on Tuesday
before the Senate Banking Committee, strongly defended the Fed's bond-buying
stimulus program and quieted rumblings that the central bank may pull back from
its stimulative policy measures, which were sparked by the release of the Fed
minutes last week.
Bernanke's comments helped ease
investors' concerns about a stalemate in Italy after a general election failed
to give any party a parliamentary majority, posing the threat of prolonged
instability and financial crisis in Europe, and sending the S&P 500 to its
worst decline since Nov. 7 in Monday's session.
Bernanke "certainly said
everything the market needed to feel in order to get comfortable again,"
said Peter Kenny, managing director at Knight Capital in Jersey City, New
Jersey.
"The fear is we were going to
see a rollover, and the first shot over the bow was what we saw out of Italy
yesterday with the elections," Kenny said. "When it came to U.S.
markets, we saw some of that bleeding stop because our focus shifted from the
Italian political circus to Ben Bernanke."
Economic reports that showed
strength in housing and consumer confidence also supported stocks. U.S. home
prices rose more than expected in December, according to the
S&P/Case-Shiller index. Consumer confidence rebounded in February, jumping
more than expected, and new-home sales rose to their highest in 4-1/2 years in
January.
However, the central bank chairman
also urged lawmakers to avoid sharp spending cuts set to go into effect on
Friday, which he warned could combine with earlier tax increases to create a
"significant headwind" for the economic recovery.
The Dow Jones industrial average gained 115.96 points, or 0.84 percent, to 13,900.13 at the close. The Standard
& Poor's 500 Index rose 9.09 points, or 0.61 percent, to
1,496.94. The Nasdaq Composite Index advanced 13.40 points, or 0.43 percent, to close at 3,129.65.
Despite the bounce, the S&P 500
was unable to move back above 1,500, a closely watched level that was technical
support until recently, but could now serve as a resistance point.
The CBOE Volatility Index or the VIX, a barometer of investor anxiety, dropped 11.2 percent, a day after
surging 34 percent, its biggest percentage jump since Aug. 18, 2011.
The uncertainty caused by the
Italian elections continued to weigh on stocks in Europe. The FTSEurofirst-300
index of top European shares closed down 1.4 percent. The benchmark Italian index tumbled 4.9 percent.
Brent Crude Oil - NEW YORK, Feb 26 (Reuters) - Brent crude oil futures fell $1.73,
or 1.51 percent, to settle at $112.71 a barrel on Tuesday as inconclusive
Italian election results revived investor concerns about instability in the
euro zone and threatened the outlook for fuel demand.
CBOT Soybean - Soybean futures on the Chicago Board of Trade fell for a
third day on pressure from the expanding Brazilian soybean harvest
and market participants exiting long soybean/short corn spreads, traders said.
* Unconfirmed talk that China may sell 1 million to 2.5 million tonnes soybeans out of reserves to ease supplies
until Brazilian shipments arrive.
·
Soymeal
futures closed higher while soyoil sank for a fifth day,
with March soyoil briefly dropping below 49 cents per
lb, its lowest level since Dec. 31.
·
The
European Union is likely to raise soymeal imports in coming
months as supplies from large harvests in Argentina and Brazil
come on to the global market - analysts Oil World.
·
Palm oil’s
competitive price against other vegetable oils means palm
is likely to win more sales in coming months in markets
including India, Europe, China and even the United States -
Oil World.
·
Germany’s
2013 rapeseed crop is likely to rise to 5.3 million
tonnes from 5.0 million tonnes in 2012, the German Farm Cooperatives Association said.
BMD CPO - KUALA LUMPUR, Feb 26 (Reuters) -
Malaysian palm oil futures slipped on Tuesday to their lowest in more than five
weeks, as weak overseas vegetable oil markets kept investors on edge, although
upbeat export data and slowing production helped limit losses.
China and U.S. soy markets, which
are tracked by palm, remained weak after suffering steep falls on Monday and as
better weather in the U.S. Midwest and South America improved the prospects for
supply.
But stronger-than-expected exports
in the first 25 days of February, buoyed by increased shipments of Malaysian
palm oil products to Europe and India, kept prices from tumbling further.
"The market is a little
oversold at the current juncture after a slew of negative news from pundits and
analysts," said a trader with a local commodities brokerage in Malaysia.
"The external market 'grains'
are a major contributor to the current low prices. We anticipate demand to pick
up very soon, and prices to recover once the selling pressure subside."
The USDA outlook numbers, with
projections of a record soybean crop at 3.4 billion bushels, are bearish, he
added. "This certainly spells trouble for palm oil in the second quarter
of 2013."
The benchmark May contract on the Bursa Malaysia Derivatives Exchange had dipped to 2,411 ringgit per
tonne, the lowest since Jan. 21, before closing at 2,417 ringgit ($779), a fall
of 2.2 percent.
Total traded volume stood at 35,620
lots of 25 tonnes each, higher than the average 25,000 lots.
Investors are pinning hopes on
healthy exports alongside seasonally slowing production to ease the current
stockpile of 2.58 million tonnes in Malaysia, the world's No.2 producer.
"At the end of the month we
might see an 18 percent drop in production. And with this kind of exports, we
will definitely see a drawdown in the stocks," said a trader who deals
with a foreign commodities brokerage.
Oil fell below $114 a barrel on
Tuesday, hit by doubts over demand growth as a potential political vacuum in
Italy revived concern over instability in the debt-plagued euro zone.
In competing vegetable oil markets,
the U.S. soyoil for May delivery fell 1.3 percent in late Asian trade. The most-active September soybean oil
contract on the Dalian Commodity Exchange slipped
1.5 percent.
Regional Equities - BANGKOK, Feb 26 (Reuters) -
Southeast Asian stock markets fell on Tuesday on profit-booking in recent
gainers such as PT Bank Mandiri Persero Tbk and Ayala Land Inc after Italy's inconclusive election
fuelled concerns of a resurgent euro zone debt crisis.
Jakarta's Composite Index lost 0.7 percent to 4,663.03 with Bank Mandiri fell 0.5 percent after Monday's
2.1 percent gain on strong results.
The Philippines slid 1.4 percent to 6,630.67 as large cap Ayala Land declined 3.5 percent.
Indonesia and the Philippines both
hit record closes on Monday, making them among overbought markets, with the
14-day relative strength index ending at 72.4 and 70.2, respectively, on
Tuesday. The level of 70 or above indicates a market is overbought.
Singapore's Straits Times Index fell 1.1 percent to a one-month low of 3,254.26 on heavy volume of 3.3 times a
monthly average, led by a 6.6 percent drop in shares of Global Logistic
Properties Ltd .
The Ho Chi Minh Stock Exchange's VN
Index dropped 3.9 percent, its biggest one day
loss since August.
Malaysia's main index eased 0.2 percent to 1,624.18, with retail and domestic institution selling
shares worth $14.8 million and $26.7 million, respectively, countering foreign
buying on the day, stock exchange data showed.
Thai SET index finished down 0.6 percent at 1,530.32. Top energy firm PTT Pcl fell 1.4 percent after it reported a weaker-than-expected net profit for the
fourth quarter.
More than 70 stocks were trading at
high valuations, about 40 times price to earnings multiple, Thai stock exchange
president Charamporn Jotikasthira said.
