Thursday, December 1, 2011

Market Overview 2nd Dec 2011

Friday, 2nd Dec. The FBM KLCI and index futures joined regional benchmark rallies yesterday after the U.S Federal Reserve agreed to aid European Union to tackle their financial trouble. Other news to follow.

"- U.S. stocks on Thursday tilted lower after the prior day’s surge as Wall Street turned wary before Friday’s November jobs report and after claims for unemployment benefits rose last week. The Dow Jones Industrial Average DJIA -0.21%  fell 25.65 points, or 0.2%, to 12,020.03, with 20 of its 30 components losing ground. The S&P 500 Index SPX -0.19%  shed 2.37 points , or 0.2%, at 1,244.59 with financial firms the heaviest weight and technology the best performing of its 10 major sectors. The Nasdaq Composite Index COMP +0.22%  gained 5.86 points, or 0.2%, to 2,626.20."

"-Asian shares joined in a global rally Thursday, soaring as investors welcomed central bank moves to slash dollar credit costs in Europe and ease monetary conditions in China. Hong Kong’s Hang Seng Index HK:HSI +5.63%  jumped 5.6%, while the Shanghai Composite Index CN:000001 +2.29%  climbed 2.3%. Japan’s Nikkei Stock Average JP:NIK +1.93%  rose 1.9%, South Korea’s Kospi KR:0100 +3.72%  finished 3.7% higher, and Australia’s S&P/ASX 200 index AU:XJO +2.64%  added 2.6%. U.S. and European stocks ended Wednesday with similarly strong gains, with the Dow Jones Industrial Average DJIA +4.24%  rising by the largest margin since 2009. "

"- Oil futures lost ground Thursday after rallying in the previous session and as traders were cautious ahead of Friday’s employment figures. Prices found some strength in news that U.S. manufacturing expanded but fell after a surprise rise in weekly U.S. jobless claims. Some traders also took profits after futures ended 1.6% higher on Wednesday. Crude for January delivery CL2F -0.16%  declined 16 cents, or 0.2%, to $100.20 a barrel on the New York Mercantile Exchange."

"-US soybean futures end lower, ending a three day recovery from prior declines. Concerns about soybean export demand in the face of favorable South American crop prospects and ongoing competition from Brazil in export markets, analysts say. Soybeans attempted to rally, but once support from equities and crude oil faded, traders focused on demand fundamentals, an area that is clouded by prospects from South American output and exports, analysts add. CBOT Jan soy ended down 3 1/4c at $11.28/bushel. Soy product futures end mixed, with traders buying soyoil at the expense of soymeal on spreads the dominant feature in the market. Analysts are encouraged about soyoil amid solid world vegoil demand, and its prospects for biodiesel as crude oil tops $100 a barrel, analysts say. CBOT Jan soyoil ended up 0.20c at 49.70 cents/lb, and Jan soymeal dropped $3.20 to $289.00/short ton."

FKLI- Breached Most Resistance Level On Gap Up

Most Asia and other regional benchmark rejoiced after the Federal Reserve agreed to help European Union to gradually resolve their debt crisis by offering loans to prevent them from falling into the biggest debt default ever in financial history. The U.S market re-acted extensively to the positive commitment by Federal Reserve to prevent European Union from debt default because it will do substantial damage to U.S economy if European countries does fall into massive debt crisis. At close, the FBM KLCI rose 13.16 points to 0.89% to 1,485.26 level while index futures for Dec contract gained about 17 points to 1.15% to 1,494.50 level, this was the highest level in 3 months. Technically, the index futures recovery has took off to a new stage after rising to the highest in 3 months yesterday or in other words, the upside is confirmed, the question is how far it could rise ? And will this be the beginning of new uptrend market, and previous 19% swift correction was just a major market corrections ? Yesterday gap up might be overdone and it might need to take some breather, paving some way for some mild corrections before continue to rallies further. If this event materialize, traders are advise to go Long on the daily pivot support level. 

Daily Pivot Point
R2= 1524
R1= 1509
S1= 1483
S2= 1472

FCPO- Rallies On Broader Market Recovery.

 CPO futures for benchmark Feb contract rose about RM40 to 3,058 yesterday amid promising recover on broader commodities and equity market after investors are relieve to know the Federal Reserve will commit to help European Union with their debt trouble if they need it. Palm oil futures re-acted positively and inches up along with Soya oil recovery which topped at 50.00 cents per pound during Asian trading session yesterday. Palm oil fundamental remain the same with uncertainties over stocks level and likely lower demand for the year end but that alone would not stop market to recover further for the moment judging from other positive factors that might support it, i.e: Soya oil and other broader based commodities recovery.  Technically, the benchmark Feb contract made its first attempt to breach the resistance trend line yesterday by closing above 3,050 level. For more upside confirmation, the benchmark Feb need to breach yesterday high above 3,078 level whcih also serve as today first pivot resistance level. We should expect more follow through Buying activities if the market could hit above 3,100 psychological resistance level today.

Daily Pivot Point
R2= 3092
R1= 3075
S1= 3043
S2= 3028
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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