Market Overview 22nd Feb 2012

Wednesday, 22nd Feb. The FBM KLCI extended its gain yesterday as Greece approved second bailout, thus further reducing the likely hood of massive debt default on Europe. Other news to follow.

"- U.S. stocks finished mostly higher Tuesday after European officials agreed to another round of aid for Greece, pushing the Dow industrials briefly above 13,000 for the first time since 2008. After topping 13,000 for the first time since May 2008, the Dow Jones Industrial Average DJIA +0.12%  ended at 12,965.69, up 15.82 points, or 0.1%. It last closed above 13,000 on May 19, 2008. The S&P 500 Index SPX +0.07%   climbed as high as 1,367.76, just points from 1,370, its May 2011 high. It finished at 1,362.21, up nearly 1 point, or not quite 0.1%, and its highest close since April 29, 2011. The Nasdaq Composite COMP -0.11%  fell 3.21 points, or 0.1%, to 2,948.57."

"-Asia’s major stock markets ended mixed Tuesday, with most indexes making only modest moves, as reaction to European approval for new aid to Greece was muted by widespread anticipation of the deal. Japan’s Nikkei Stock Average JP:NIK -0.20% slipped 0.2%, and South Korea’s Kospi KR:0100 -0.03%  closed fractionally lower, but Hong Kong’s Hang Seng Index HK:HSI +0.25%  rose 0.3% after moving in and out of positive territory during the session. Earnings results helped Australia’s S&P/ASX 200 index AU:XJO +0.83%  rise 0.8%, while the Shanghai Composite Index CN:000001 +0.75%  also added 0.8%, finding support from real-estate shares. European finance ministers concluded a marathon meeting early Tuesday with agreement on the terms of a new bailout deal for Greece, totalling 130 billion euros ($171.9 billion)."

"-Crude-oil futures rallied 2.5% on Tuesday to settle at a nine-month high, pushing past $105 a barrel on fears of more supply disruptions from Iran’s latest move and as traders cheered Greece’s second bailout. Crude for March delivery CLH2 +3.49%  advanced $2.60, or 2.5%, to settle at $105.84 a barrel on the New York Mercantile Exchange. That was oil‘s highest settlement since early May."

"-US soybean futures end higher, fueled by strong export demand and lingering uncertainty about South American production. Soybeans climbed to fresh four-month highs, able to withstand spillover pressure from corn and wheat. Ongoing concerns about smaller crop sizes in South America are attracting fresh export business, and with corn poised to grab more US acres from soybeans this year, traders are comfortable adding risk premium to prices, analysts say. CBOT March soybeans ended up 3 1/2c to $12.71/bushel. Soy product futures end mixed, with soymeal unable to feed off the firm price theme in soybeans. Soymeal stumbled with other feed grains, garnering additional pressure from sluggish domestic demand, analysts say. Soyoil futures climbed, buoyed by strength in soybeans and crude oil futures. CBOT March soymeal ended down $2.30 at $330.20/short ton; March soyoil ended up 0.66c to 54.06c/lb."

 FKLI- Holding On Their Gain

 Stock index continue to rose for the second time this week as Greece receive deal on their second bailout yesterday. Despite craze rally, local and regional market did not respond that well as this Greece bailout results has already anticipated previously. But nonetheless, this news does strengthen market confidence and generally paving way for more promising recovery on the stock market. Technically, the Feb contract has expand higher yesterday as a continuity from it's previous uptrend. Although we are not anticipating a smooth sailing approaching 1,600 level, there is no danger sight for Bearish trend reversal yet so far. Plus U.S market is expected to resume its trading session on higher note after it close on Monday for Presidency holiday. If anything goes wrong, the index futures should rebound from the support channel or some would know it as support trend line. For today, support is located around 1,561.50 while resistance is pegged at 1,576.50

Daily Pivot Point
R2= 1576.50
R1= 1572.50
S1= 1561.50
S2= 1554.50

FCPO- Bulls Are Dominating.

CPO futures continue to move upwards with higher gear yesterday couple with promising surge on Soya oil during Asia trading session. At close, the benchmark May gained about RM23 to 3,268 while CME Soya oil rose about 0.415 cents to 53.81 cents per pound on 5.45PM +8GMT. Part of palm oil price recovery was likely due to surging commodities prices that include Crude oil and Soya oil, which is more relevant. Technically, market is still trending up and we are expecting the benchmark May to continue rising until 3,300 which could turn out to be another important resistant level. Some of you may ask whether the Bulls still have the energy to rise after it have rally more than 200 points from previous swift correction that brought the market down to 3,050 level, 3 weeks ago. There would be no direct answer to this as some traders would like to re-act to major support and resistance level while most of the traders in the market would like to pick the top and bottom to execute their trades. And by that reason alone, market will move within expectation and most of the time beyond our expectation. For this mean time, support is located around 3,240 while resistance is pegged at 3,284 followed by 3,300 level.

Daily Pivot Point
R2= 3301
R1= 3284
S1= 3240
S2= 3213
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.