Sunday, April 22, 2012

Market Overview 23th April 2012

Monday, 23rd April 2012. The FBM KLCI went down on previous Friday but still hover within the trading range since past two weeks. Other news to follow.

"-U.S. stocks mostly rebounded Friday from a two-day losing spell, with two of the major indexes tallying weekly gains, as better-than-expected corporate results overrode global concerns. "A lot of stock prices are being made in Europe these days, but it is a short-term phenomenon. Even though the economies are weak, they seem to be doing what they should be doing," said John Manley, chief equity strategist at Wells Fargo Advantage Funds. Halting a two-week losing run, the Dow Jones Industrial Average DJIA +0.50% rose 65.16 points, or 0.5%, to 13,029.26, leaving it 1.4% ahead from the week-ago close. The S&P 500 SPX +0.12% added 1.61 point, or 0.1%, to 1,378.53, up 0.6% for the week. The Nasdaq Composite COMP -0.24% fell 7.11 points, or 0.2%, to 3,000.45, off 0.4% for the week, its third consecutive weekly slide."


"- Asian shares mostly lost ground on Friday, with investors taking a lead from the U.S. and sending technology stocks lower, although emerging monetary-policy support helped lift China.

South Korea’s Kospi KR:0100 -1.26%  led the region lower with a 1.3% loss as a poor earnings report from LG Chem weighed. In Tokyo, the Nikkei Stock AverageJP:100000018 -0.28%  fell 0.3%. In China, however, the Shanghai Composite Index CN:000001 +1.19%  ended with a 1.2% gain, while Hong Kong’s Hang Seng Index HK:HSI +0.07%  rose 0.1%. Australia’s S&P/ASX 200 index AU:XJO +0.09%  gained 0.1%."
"-Oil futures ended higher Friday, snapping a two-day losing streak for the commodity and ending the week with modest gains. Crude for May delivery advanced 78 cents, or 0.8%, to end the session at $103.05 a barrel on the New York Mercantile Exchange."


"-July Soybeans finished up 7 1/2 at 1421, 14 3/4 off the high and 8 3/4 up from the low. July Soybean Oil finished down 0.01 at 55.59, 0.6 off the high and 0.17 up from the low. May soybeans closed slightly higher on the session but down sharply from the highs of the day which were posted early. More China buying of US old crop soybeans plus a surge higher in corn sparked renewed buying interest in the soybean market early today. Rumors of China buying old crop corn helped to support. Private exporters reported the sale of 110,000 tonnes of US soybeans to China for the 2011/12 season. Weekly export sales for soybeans came in at 374,300 metric tonnes for the current marketing year and 845,000 for the next marketing year for a total of 1.219 million tonnes which was well above trade expectations. Sales of 126,000 metric tonnes are needed each week to reach the USDA forecast. Net meal sales came in at 300,700 metric tonnes for the current marketing year and 1,500 for the next marketing year for a total of 302,200. Sales of 82,000 metric tonnes are needed each week to reach the USDA forecast. Oil sales were 23,900 metric tonnes which was also well above expectations. Cumulative soybean oil sales stand at 66.2% of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 65.3%. Sales of 7,000 metric tonnes are needed each week to reach the USDA forecast."


FKLI- Still Trapped

Lack luster market and uncertain economy stability were the main headlines that curb most equity market to rise higher for the moment. Even though we have more earnings news coming out locally and from foreign market, market is still susceptible to weaken if the earning results is poorer than expected. For instanceChina's first-quarter GDP data was at 8.1% year-on-year compared with the previous quarter's 8.9%. Nonetheless many analysts are forecasting China' annual GDP to have a soft landing at circa 8.3%-8.5% full-year growth. Separately, the International Monetary Fund (IMF) cut China's current account surplus to 4%-4.5% of GDP over the medium term, from an earlier estimate of 7.5%. But things may not be that bad locally as a few blue chips companies such as Maybank and CIMB are expecting to announce positive earning results. On the technical perspective, the market is still congesting within the horizontal support and resistance trend line. This is the method used to trade in the ranging market by identifying immediate support and resistance area first. Traders may go Long when the index futures approaching the support area shown on the hourly chart above. If anything goes wrong, Stop loss will be place few points below the second horizontal support trend line. For today, pivot point support is located around 1,582 while resistance is pegged at 1,593.

Daily Pivot Point
R2= 1593
R1=1590
S1= 1585
S2=1582

FCPO- Upside Resuming

CPO begin lower but manage to finish unexpectedly higher on previous Friday amid some help from Soy bean futures. The benchmark July finished up about RM23 to 3,500 level after dipping to the low of 3,444. Buyers step in on the final minute before the closing bell and force the market to end with a Bullish engulfing candle. This may mean that previous Bearish sentiment that caused the benchmark July to breached below the long term support trend line to be turn to neutral. Technically, previous week losses have been nullified by the surprise recovery made on previous Friday. With this positive momentum, most of the Bears influence are likely deny last Friday as market start with Sellers controlling the tone but ended with Buyers domination. Moreover, major support level could be identified on benchmark July as price manage to bounced off successfully when it approach 3,440~3.444 level. More market recovery will be greatly enhance if the price manage to surpasses previous Friday high above 3,509. For today, support is likely to located around 3,459 while resistance is pegged at 3,549.

Daily Pivot Point
R2= 3549
R1=3524
S1= 3459
S2=3419
 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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