Market Overview 21st Nov 2011

Monday, 21st Nov. The FBM KLCI ended lower amid growing concern over European debt issues and slower than expected performance on U.S stock index. Other news to follow.

"-U.S. blue-chip stocks rose Friday as a gauge of leading indicators climbed, boosting views of the U.S. economy. But the major indexes lost about 3% for the week, their worst performance in nearly two months. The Dow Jones Industrial Average DJIA +0.22%   ended up 25.43 points, or 0.2%, to 11,796.16, off 2.9% from last Friday’s close. That was its worst week since Sept. 23. Down 3.8% on the week, the S&P 500 Index SPX -0.04%   ended down 0.5 point, or 0.04%, at 1,215.65 Friday, with utilities and financial companies faring best and technology and energy the weakest performers among its 10 industry groups. It was also the S&P 500’s worst week since Sept. 23. The Nasdaq Composite COMP -0.60%   fell 15.49 points, or 0.6%, to 2,572.50, a level that has it down nearly 4% from last Friday’s close. "

"- Asian shares dropped sharply Friday, pulled down by fresh concerns about Europe’s ongoing debt woes following a weak Spanish bond auction. Hong Kong’s Hang Seng Index HK:HSI -1.73%  dropped 1.7%, while the Shanghai Composite Index CN:000001 -1.89%  fell 1.9%.

Japan’s Nikkei Stock Average JP:NIK -1.24%  lost 1.2%, Korea’s Kopsi KR:0100 -2.00%  fell 2%, and Australia’s S&P/ASX 200 index AU:XJO -1.91% shed 1.9%."

"-Crude-oil futures ended lower after fluctuating between small gains and losses earlier in Friday’s session, as concerns about the sovereign-debt crisis in Europe kept worries about oil demand alive and well.Crude for December delivery  declined $1.41, or 1.4%, to settle at $97.41 a barrel on the New York Mercantile Exchange."

"-US soybeans end steady, stabilizing after choppy trading today. Analysts view current prices as a good reflection of fair market value, reflective of renewed export interest from foreign buyers, particularly China, analysts said. Uncertainty surrounding the global economy in the face of the euro-zone debt crisis, continue to limit investor's appetite for risk. However, traders are mindful that if prices slump too far, supplies could tighten to more uncomfortable levels, analysts added. CBOT Jan soybeans end unchanged at $11.68 1/4/bushel. Soy-product futures end mixed, with traders unwinding some positions ahead of the weekend. Soyoil was hit by spillover pressure from declines in crude oil, a feature that may weaken biodiesel margins, analysts note. But soymeal was lifted by a recent upturn in demand. CBOT December soyoil dropped 0.52c to 50.88c/pound while soymeal rose $3.90 to $298.40/short ton."

 FKLI- Healthy Correction Not A Bearish Reversal Yet.

Stock index retrace again last Friday as it made some correction from previous rally. Regional stock index mostly ended in negative territories last week amid escalating concern over European debt crisis would get out of hand. We are not getting much boost from the west market as well as their stock index are currently weaken. Technically, we are likely expect more weakness on index futures judging from the lower high formation so far. The Nov contract would retrace down to the support area soon if the support trend line @ 1,440 level would breach. If this event materialize, we going to see lower low formed on hourly chart today. The correction might halt, targeted major support would be located around 1,420 level, some rebound is likely expected around this level as it is known as oversold level.

Daily Pivot Point
R2= 1460
R1= 1452
S1=1439
S2= 1434


FCPO- Buyer Remain Strong, Correction Was Short Lived.

Palm oil futures is not going to give up gain so easily judging from last week positive momentum. But this scenario may not be the same for this week as it should pave some session for corrections, maybe at least for a day. Last week, there was merely any noticeable correction as market quickly recovered from weakness. Buyers are likely remain aggressive throughout this week judging from better than expected palm oil fundamental. The upside momentum remain intact for this week as palm oil supplies is likely disturb by current above-average rainfall (La Nina) over the next few weeks in key palm oil growing areas in peninsular Malaysia. To make matter worse, state-linked Malaysian Palm Oil Board point to further falls in stock levels in the coming months, as the ongoing monsoon and a developing La Nina event could stall harvesting progress. Technically, there is sign for the market to retrace yet but traders can focus more to Long around support level. For today, support is likely located around 3,193 while resistance is pegged at 3,286.  
 
Daily Pivot Point
R2= 3324
R1= 3286
S1=3193
S2= 3138
Disclaimer: Information and opinions contained in this report are for educational purposes only. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness.