Thursday, December 15, 2011

Market Overview 16th Dec 2011

Friday, 16th Dec. The FBM KLCI manage to closed positively amid growing concern over regional economy slow down that shun investors from taking too much risk in the equity and commodities market.

"-U.S. stocks gained after investors took heart from stronger U.S. economic data, snapping a three-day losing streak, but finished off session highs after another warning about Europe’s sovereign-debt crisis. The Dow Jones Industrial Average DJIA +0.38%   rose 45.33 points, or 0.4%, to 11,868.81. The Standard & Poor’s 500-stock index SPX +0.32%   tacked on 3.94 points, or 0.3%, to 1,215.76, and the Nasdaq Composite COMP +0.07%   eked out a gain of 1.7 point, or 0.1%, to 2,541.01. The defensive utilities, health care and consumer-staples sectors posted the strongest gains as investors edged back into stocks after three days of losses. Initial jobless claims filed in the U.S. last week were the lowest since May 2008, the Labor Department said."

'_Asian markets slumped Thursday, with resource-sector shares suffering hefty losses a day after commodity prices plunged on mounting fears about euro-zone debt troubles. Concern about Asia’s economic health also contributed to the sell-off after data showing manufacturing activity weakened in China, while the Bank of Japan’s quarterly tankan survey showed worse-than-forecast conditions for large manufacturers. Japan’s Nikkei Stock Average JP:NIK -1.66%  fell 1.7% to 8,377.37, Australia’s S&P/ASX 200 index AU:XJO -1.21%  declined 1.2% to 4,139.80, South Korea’s Kospi KR:0100 -2.08%  shed 2.1% to 1,819.11 and Taiwan’s Taiex gave up 2.3% to 6,764.59. Hong Kong’s Hang Seng Index HK:HSI -1.79%  dropped 1.8% to 18,026.84, while China’s Shanghai Composite Index CN:000001 -2.14% skidded 2.1% to 2,180.90, suffering its ninth decline in 10 trading days to finish at a level it hasn’t seen since March 2009."

"- U.S. crude-oil futures declined Thursday after their early-session relief rally lost steam despite good news on the economic data front. Crude oil for January delivery CL2F -0.16% declined $1.08, or 1.1%, to $93.87 a barrel on the New York Mercantile Exchange. Prices got tenuous support from a weaker dollar, rising stocks, and good news about manufacturing levels in the Philadelphia and New York areas, as well as a drop in jobless claims."

"-US soy futures end higher amid worries about the South American crop. Dry weather in Argentina fueling concerns about potential yield loss, although traders say the growing season is still early. A weaker dollar added to the support. Traders also say the market's inability to pierce support at $11 prompted short-covering. Prices rallied despite losses in corn. CBOT March soy ends up 11 3/4c, or 1.1%, to $11.11 3/4 a bushel. March soybean oil ends up 0.56 cents to 49.36 cents/lb, while March soybean meal flat at $286.30 per short ton."

 FKLI- Trading Within The Triangle.

 The FBM KLCI rose slightly yesterday despite poor performance from Asia regional index due to escalating concern over economy slow down in the west and Asia country, I.e, China and Japan. There is nothing concrete for the market to regain its footing and surge unless we are talking on some technically ground. Most of the bad news were still focus on European debt crisis while for the our local stock market, the only happening rumors to support the market may seems to be impending general election. Yes you did not read it, the prime minister have hinted during UMNO assembly to get ready for Malaysia general election, although the premier does not officially specify the big date. According to market seasonal pattern, we should have some window dressing event towards this end of final. Unfortunately on the technical term, index futures is likely trading within the triangle (white colored ) shown above unless there is any major break out or break down from the triangle. Conservative traders may want to wait longer as there might be a pull back on a break out or some mild recovery on a break down (from the white triangle) entering the market. For today, support is located around 1,447 while resistance is pegged at 1,472.50.

Daily Pivot Point
R2= 1482
R1= 1472.50
S1= 1447
S2= 1431

 FCPO- Bears Resume Control

CPO futures closed significantly lower amid escalating concern over weaker palm oil data that showed lower monthly demand towards the end of 2011. Price were also effected by the weak overnight performance over the Soya oil futures which drop below 49.00 cents again earlier yesterday due to higher USDA projection on Soya bean inventories. Apart from that, the palm oil export figures for 1st-15th Dec vs Nov announced yesterday saw a substantial declined, prompting weak demand for palm oil towards the end of 2011. At close, the benchmark Feb closed RM81 to 2,971, the lowest since 8th Nov. Market is poised to continue heading south very soon as it was hammered by selling pressure yesterday with increased volume and open interest. In other words, Bears are definitely in control yesterday, pushing the price further south to closed at the day's low. Technically, previous Tuesday recovery can be deem as technical rebound when the price headed down to 2,971 yesterday. For today, market is likely to continue trending down with the first support is eyed at 2,933 while resistance is located at 3,009 if the market open higher for any reason.
  
P/S: Malaysia Dec. 1-15 Palm Oil Exports Down 17% On Month -Intertek. Malaysia Dec. 1-15 Palm Oil Exports 649,138 Tons, Down 19% -SGS
Daily Pivot Point
R2= 3047
R1= 3009
S1= 2952
S2= 2933
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.

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