Monday, September 3, 2012

Market Overview 4th Sept 2012

Tuesday, 4th Sept 2012. The FBM KLCI surge to all time high as investors are eyeing on the west on U.S Federal reserve with their upcoming quantitative easing. Other news to follow.

"-European stocks climbed for a second session Monday on investors made a bet central banks would move to help growth after Chinese data illustrated a slowing global economy. Jumping the most in a month, the Stoxx Europe 600 index XX:SXXP +0.84%  rose 0.8% to 267.46, adding to a 0.5% gain from Friday."

" Jobs data and a European Central Bank meeting will dominate next week as investors return to a market that, with little fanfare, just finished three months of gains. While the monthly unemployment report has always figured heavily on investors’ minds, it took on particular significance Friday as Federal Reserve Chairman Ben Bernanke called the recovery in the labor market “painfully slow” and signaled a willingness to use more quantitative easing tools. NYSE was closed for labor holiday today but Futures product still trade as usual"

"- Most Asian markets rebounded from a weak start Monday as a sharp deterioration in Chinese manufacturing conditions fueled hopes that Beijing will act to support the economy, although a strengthened yen hurt Japanese shares. The Shanghai Composite Index CN:000001 +0.57%  ended 0.6% higher, and Hong Kong’s Hang Seng Index HK:HSI +0.39%  finished 0.4% up. But Japan’s Nikkei Stock Average JP:100000018 -0.63%  finished 0.6% lower, unable to latch on to gains recorded earlier in the day."

"- Oil futures rose Monday on thinking central banks would make additional moves to bolster growth after manufacturing contracted in China. Prices climbed on expectations of further stimulus steps after China’s Purchasing Managers Index narrowed, with crude for October delivery CLV2 +2.43% gaining 58 cents, or 0.6%, to $97.05 in electronic trade on the New York Mercantile Exchange, where floor trade was closed for the U.S. Labor Day holiday."

"-CME pit trading session is closed for labor day holiday."

FKLI- Dragging Game To Extended Time / Injury Time. 

The stock index surged to all time high yesterday thanks to Bernanke speech that hint the Federal Reserve likely approve a third large round of asset purchases as soon as the next policy meeting in September. Conclusively, that was a positive progress or measure to spur economy growth almost immediately and the ripple effect will not only felt in equity index but any market you can think of.  At close, the FBM KLCI edge up about 7.79 points to 1,653.90, a level unseen so far since day one. Unfortunately, the enthusiasm on the stock index was not felt on index futures. The spot month contract just merely tracking behind the stock index surged by closing at 1,646 level, which lag behind 7 points discounts compare to stock index. Technically, the Bulls are taking extra time to defeat Bears as there was not enough juice for the spot month contract to stayed above 1,650 level. Derivative traders may need more time to convince themselves that there is still more room to go up on the stock index this week. For the moment, market is still hovering on sidways direction with immediate support remain around 1,640 level while resistance is located around previous high at 1,658 level.   

Daily Pivot Point
R2= 1654
R1= 1650
S1= 1642
S2= 1638

FCPO- Break Away Gap

The palm oil futures surge unexpectedly higher yesterday amid recent recovery on palm oil export for the Aug month and maybe due to news over quantitative easing on U.S market as well. At close, the benchmark Nov went up about RM54 to 3,073 level, closing just 3 points below the day high yesterday. Previous lower closing price on Soy oil last Friday has no effect on yesterday palm oil futures opening session as market opened gap up with no retracement at all. Technically, further recovery on the benchmark Nov is likely to continue as there was a break away gap when the market open gap up from previous higher low formation yesterday. And that's not all, the long Bullish candle on daily chart was a positive sign for the market to recover further after the market went down for correction previously. Moreover, the ability for the benchmark Nov to close at the day high also signifies that Buyers stayed controlled throughout the trading session yesterday. For today, support is located around 3,036 while resistance is pegged at 3,093 level.

Daily Pivot Point
R2= 3093
R1= 3073
S1= 3036
 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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