DJI - NEW YORK, Jan 3 (Reuters) - U.S.
stocks edged lower on Thursday after minutes from the latest Federal Reserve
meeting showed growing concern about the risks of its highly stimulative
monetary policy.
Despite the concerns about the
effects of its asset purchases, the Fed look set to continue its open-ended
stimulus program for now.
The minutes from the December
meeting showed a growing reticence about further increases in the central
bank's $2.9 trillion balance sheet, which it expanded sharply in response to
the financial crisis and recession of 2007-2009.
Stocks had pushed the benchmark
S&P 500 index 4.3 percent higher during a two-day run as investors turned
their focus to upcoming battles in Congress, including likelihood of bitter
fights over spending cuts and raising the federal debt ceiling.
"As we look down the pathway
here, there are some real issues in front of the market. There is going to be a
new battle in two months over the debt ceiling and sequestration and
fourth-quarter earnings are going to start to come into focus," said
Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
"There are some issues out
there that could hold this market back, but on the other side of the ledger,
zero interest rates are a tremendous stock market flotation device."
The rally in equities began on the
last day of 2012 on optimism a deal would be reached to avert the "fiscal
cliff," and avoid a possible recession. Gains continued on Wednesday, the
first trading day of 2013, with Wall Street's best performance since Dec. 20,
2011 after Congress approved a fiscal compromise.
Retailers advanced after several
major companies in the sector beat expectations of modest sales increases in
December, with the S&P retail index up 0.8 percent and the Morgan Stanley
retail index up 0.6 percent.
The Dow Jones industrial average dropped
17.47 points, or 0.13 percent, to 13,395.08. The Standard & Poor's 500
Index shed 2.30 points, or 0.16 percent, to 1,460.12. The Nasdaq Composite
Index dipped 5.19 points, or 0.17 percent, to 3,107.07.
Economic data showed U.S.
private-sector employers shrugged off a looming budget crisis and stepped up
hiring in December, offering further evidence of underlying strength in the
economy as 2012 ended.
The government's broader monthly
payrolls report, due on Friday, is expected to show the economy created 150,000
jobs compared with 146,000 in November, according to a Reuters poll. The U.S.
unemployment rate is seen holding steady at 7.7 percent.
Retailers advanced after several
major companies in the sector beat expectations of modest sales increases in
December, with the S&P retail index up 0.8 percent and the Morgan Stanley
retail index up 0.6 percent.
Shares in Costco Wholesale Corp rose
1.4 percent to $102.85 after the company reported a better-than-expected 9
percent rise in December sales at stores open at least a year.
Gap Inc stock climbed 3.1 percent to
$32.33 following news that the retailer will buy women's fashion boutique
Intermix Inc, the Wall Street Journal reported.
Family Dollar Stores Inc stumbled 12
percent to $56.38 on the company's report of lower-than-expected quarterly
profit.
NYMEX - NEW YORK, Jan 3 (Reuters) - U.S.
crude futures edged lower on Thursday, faltering after the previous session's
1.4 percent rally, traders and analysts said, as looming budget battles in
Washington tempered optimism about the deal to avert the automatic tax hikes
and spending cuts considered a threat to economic growth.
Late in the session, crude futures
felt pressure when minutes from the latest policy meeting revealed signs of
growing concern by the U.S. Federal Reserve about buying bonds to spur economic
growth.
CBOT Soybean - Soybean futures on the Chicago Board of Trade
fell for a third
straight session, with the
bellwether March contract touching a six-week low after China
canceled orders of U.S. soybeans, traders said.
USDA said China canceled purchases
of 315,000 tonnes of U.S. soybeans for delivery in
2012/13. The move follows Chinese cancellations of purchases totaling
840,000 tonnes in the week of December 16.
·
Also
bearish, USDA's attache in Brazil raised its estimate of Brazil's 2012/13
soybean production to a record-large 83 million tonnes, above USDA's last
official forecast of 81 million tonnes.
·
Additional
pressure from strength in the U.S. dollar, which firmed after minutes from the
Federal Reserve's latest meeting showed rising concern about the Fed's policy
of buying bonds to stimulate growth. The policy has helped to buoy equity and
commodity markets.
·
CBOT
soymeal fell for a sixth day, with the front contract dipping below below $400
a ton for the first time in seven months.
·
CBOT
March soyoil ended lower on profit-taking after Wednesday's 2.7 percent jump,
halting a four-session rally.
·
Trade
expects USDA to report weekly export sales of U.S. soybeans on Friday at
250,000 to 450,000 tonnes. The report was delayed by a day due to the New
Year's Day holiday.
·
CBOT
reported nine soymeal deliveries against January futures, 2,754 soyoil
deliveries and no soybean deliveries.
FCPO - SINGAPORE, Jan 3 (Reuters) - Malaysian palm oil futures edged lower on Thursday after prices climbed to a two-month high the previous day, although hopes of a new export tax structure boosting demand had curbed losses.
The tropical oil started the year strongly by jumping to its highest since Nov. 2 on Wednesday after the United States reached a fiscal deal that prevented the world's largest economy from slipping into recession.
Market players are eyeing Malaysia's Jan. 1-10 exports data due next week, expecting higher demand from crude palm oil as the country imposed a zero percent duty in January for shipments of the grade.
"We see a bit of profit-taking
coming in. Every time we go above 2,500 ringgit, there's no strong follow
through," said a trader with a foreign commodities brokerage in Malaysia.
"The important issue now is
with the new export tax structure and traders want to see how Malaysian exports
will be for the first 10 days. Prices should be trading in a range of
2,450-2,550 ringgit."
At market close, the benchmark March
contract on the Bursa Malaysia Derivatives Exchange fell 1.0 percent to 2,475
ringgit ($816) per tonne. Prices hit a two-month high of 2,524 ringgit on
Wednesday.
Total traded volumes stood at 36,244
lots of 25 tonnes each, higher than the usual 25,000 lots.
Technicals appear to be bearish as
palm oil is expected to retrace to 2,452 ringgit based on a wave analysis,
Reuters market analyst Wang Tao said.
But prices may find support as lower
December production and disruption to supply due to heavy rains could help ease
record-high stocks of 2.56 million tonnes, traders said.
Industry regulator the Malaysian
Palm Oil Board will release official data on December's stocks and output next
week.
Investors are monitoring the impact
of China starting to enforce its quality standards on edible oil imports. Palm
oil which fails to make the grade could see cargoes turned away from Chinese
ports, depressing demand a little.
Brent crude dropped below $112 a
barrel on Thursday as the prospects of more budget battles in the United States
and rising oil supply weighed on prices, although upbeat economic data from China
limited losses.
In competing vegetable oil market,
U.S. soyoil for March delivery fell 0.2 percent in late Asian trade. China's
Dalian Commodities Exchange is closed for the New Year holiday and will resume
trading on Friday.
