Market Overview 18th April 2012

Wednesday, 18th April 2012. The FBM KLCI retrace slightly yesterday amid concern over weak FDI flow into China recently. Other new to follow.

"U.S. stocks leapt Tuesday, pushing the Dow average to its first finish above 13,000 in more than a week, as increased appetite for Spanish debt calmed global concerns and tech stocks rebounded.  The Dow Jones Industrial AverageDJIA +1.50%  closed up 194.13 points, or 1.5%, to 13,115.54, its biggest point gain in a month, after rallying as much as 209 points. The S&P 500 SPX +1.55%  climbed 21.21 points, or 1.6%, to 1,390.78. Technology stocks rose 2.3%, the best performers among 10 industry sectors, all of which gained. Tech had been the worst performer Monday, losing more than 1%.

The Nasdaq Composite COMP +1.82%  gained 54.42 points, or 1.8%, to 3,042.82, rebounding after two sessions of losses.

"-Asian stocks skidded on Tuesday amid lingering worries about Spain’s debt troubles, with mainland Chinese and Hong Kong stocks dropping after data showing foreign direct investment in the mainland continued to decline. Hong Kong’s Hang Seng Index HK:HSI -0.23% lost 0.2% to 20,562.31 and China’s Shanghai Composite index CN:000001 -0.94%  contracted 0.9% to 2,334.98. Taiwan’s TaiexXX:Y9999 -1.86%  fell the most in the region, dropping 1.9% to 7,585.87, as technology stocks there took a beating after an overnight decline on Nasdaq. Australia’s S&P/ASX 200 index AU:XJO -0.31%  gave up 0.3% to 4,288.80, South Korea’s Kospi KR:0100 -0.37%  fell 0.4% to 1,985.30 and Japan’s Nikkei Stock AverageJP:100000018 -0.06%  slipped 0.1% to 9,464.71."


"-Crude futures advanced Tuesday, as a successful Spanish bond sale and data showing German investor confidence rising for the fifth month in a row buoyed hopes the world economy is on the mend, propelling U.S. equities and commodities alike.

Oil for delivery in May CLK2 +0.15%  advanced $1.27, or 1.2%, to $104.20 a barrel on the New York Mercantile Exchange."

"-Soybean futures closed 5 1/2 to 7 1/2 cents higher, which was near the middle of today's range. Buyers returned to the soybean market today after consecutive days of corrective price declines. Fundamental support came from fresh demand news as USDA announced daily sales of 225,000 metric tons (MT) of soybeans to unknown destinations, split between this and the upcoming marketing year."

FKLI- Still The Same Ranging Market

Stock index finished slightly lower yesterday due to lacking wonderful effect from recent earning results announcement from U.S market. The FBM KLCI went down about 1.32 points to 1,596.19 level while stock index closed unchanged at 1,598 after hovering within 1,598~1,593 throughout the trading session. Market will paired win and losses closely as it will recover and quickly giving up that gain again in a sideways market. Technically, both index futures and stock index are still ranging on the top currently as both Bulls and Bears are somewhat equally matched. Trader may want to wait to go Short if the market rise high enough or approaching its resistance area or go Long when it approach support area. Else, there is no point taking any position in between these range. If you do, you are not making any worthwhile guess in the market. Major support still stand at 1,575 while major resistance is located at 1,606.

Daily Pivot Point
R2= 1601
R1= 1599
S1= 1594
S2= 1591

FCPO- Looking For Support

CPO futures manage to finished on higher ground yesterday and regaining healthier price outlook for the to recover further. After surging to 13-months high, the Bulls just need some breather before it could continue to run again. Therefore, market need to correct about 170 points or 4.7% from 3,625 to 3,460 level since past Thursday. Technically, the benchmark July has yet to breach the long term support trend line at the moment. Things are looking better as palm oil price manage to bounce off from previous correction yesterday but it is still early to say that we are clear from further price mark down this week. In other words, price is still travelling on danger area as one more craze sell-off will triggered collective Selling spree. Furthermore, things could get even worse if the benchmark July able to breach below the long term support trend line. Overall, market is having some correction at the moment and this was a typical scenario to expect in any up-trend market. Another lower highs is forming on daily chart and only time will tell whether this formation turn out to be valid. Upside continuation will be confirmed if the July contract manage to rise above 3,530 level this week.

Daily Pivot Point
R2= 3526
R1= 3514
S1= 3479
S2= 3456

 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.