Market Overview 3rd Jan 2012

Tuesday, 3rd Jan 2012. The FBM KLCI departed the 2011 with some losses year to year basis but equities market generally is bouncing back steadily while investors are keeping their eye on European debt crisis. Other news to follow.

"- U.S. stocks slid Friday, with the S&P 500 relinquishing its 2011 gain, as investors closed the books on a volatile year largely driven by Europe’s uncertain efforts to stem its debt crisis.

The Dow Jones Industrial Average DJIA -0.57%  ended the year up 5.5%, its second consecutive yearly rise. What had been a slight gain for 2011 vanished in the final moments of trade for the S&P 500 Index SPX -0.43% , which finished a fraction below its 2010 close. The Nasdaq Composite Index COMP -0.33%  finished 2011 down 1.8% for its first annual loss since 2008."

 "-Japanese and Chinese markets ended higher in light trade Friday, with investors focusing more on U.S. gains overnight than on data showing a further contraction in China’s manufacturing activity. The Shanghai Composite CN:000001 +1.19%  climbed 1.2%, while Japan’s Nikkei Stock Average JP:NIK +0.60%  rose 0.7%, and Hong Kong’s Hang Seng Index HK:HSI +0.20%  closed 0.2% higher in choppy trade. Elsewhere, Australia’s S&P/ASX 200 index AU:XJO -0.36%  lost 0.4% in a shortened trading session, while South Korean markets were closed for a holiday. For the year, however, all of the top Asian stock indexes were well in negative territory. The South Korean Kospi KR:0100 +0.03%  was off 11% in 2011, with the S&P/ASX 200 down 14.5%, the Nikkei Average 17.3% lower, the Hang Seng Index down 20%, and the Shanghai Composite 21.7% in the hole."

"- Crude oil futures closed lower Friday as traders eyed developments in Europe and Iran and their potential risks to global oil demand, but prices ended the year more than 8% higher after a strong fourth quarter. Crude for February delivery CL2G -0.59% shed 82 cents, 0.8%, to settle at $98.83 a barrel on the New York Mercantile Exchange. The exchange held a full session of trading Friday, but will be closed for the new year holiday on Monday."

"-US soy futures end higher, rallying on hot South American weather that is also driving corn higher. Forecasts for more of the same in Argentina are worrying traders about the crop there. Soy climbed 3.1% on the week but failed to set fresh 7-week highs near the close as corn did. South American heat is the biggest threat to corn but a growing worry for soy. The market's technical trend is up, and Dave Marshall, an independent advisor in southern Illinois, says technical chart gaps are becoming more supportive the longer they stay intact. CBOT January soy closes up 11c at $11.98 1/2 a bushel, but spot futures lost 8.6% on the year. CBOT March soyoil rose 0.9c to 52.42c/pound and soymeal added $2.30 to $313.10/short ton."

FKLI-  Recovery Still On Track.

Welcome back dear savvy traders, this site will continue to provide valuable insight and information pertaining local derivatives market. Today we will be trading for the first time for the year 2012. The year 2012 first trading session will begin shortly and I hope most of you are equip with sufficient knowledge from this web site so far. Lets begin with some recap for the stock index and index futures. For the past two months, both instrument  have been rallying on "thin air" or for most who wish to believe it were riding on "Christmas rally" as it were before. The promising recovery that we saw so far happen to supersede most analyst who believe market would continue to correct during the European debt crisis erupt three months ago. The fact is, market have recover almost 70% when it correct down to 1,295 level from 1,599 area and we believe it should continue to rally close to all time high around 1,600 maybe before Chinese new year. Technically, market have been creating series of higher lows and higher highs on daily chart which firmly suggesting strong positive momentum that is going to last for few session. For today, we are expecting some minor retracement for the opening session judging on previous U.S equities market performance last Friday. Support is located around 1,512 while resistance is pegged at 1,537.

Daily Pivot Point
R2= 1537
R1= 1529
S1= 1512
S2= 1504

FCPO- Steady Upside So Far. 

CPO futures manage to recover on previous Friday but the it closed miserably lower looking on yearly basis which due to higher than expected stocks and production towards the end of year. On close, the benchmark Mar rose about RM20 to 3,175 level, closing RM4 off the high. For this near term, palm oil futures is likely to recover further judging on promising recover made by Soya oil futures due to South America hot weather that curb Soy crops and cultivation for this near term. Not only that, the technical outlook on palm oil price action also suggested that market is likely to recover further by looking at the higher lows candles formation shown on hourly chart above. For stronger  Bullish confirmation, the benchmark Mar need to overtake above its previous session Thursday high around 3,205 level.  Other than that, most market participants are expecting better demand for palm oil as Chinese new year is just around the corner. For today, support is located around 3,159 while resistance is pegged at 3,194 area. 

Daily Pivot Point
R2= 3194
R1= 3184
S1= 3159
S2= 3144
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.