Thursday, September 19, 2013

Fed Reserve Avoid Tapering And Continue Asset Buying Programme 19th Sept 2013

Thursday, 19th Sept 2013. U.S federal reserve bond buying programme remain and help most of the financial market rose overnight. Other news to follow.

"-  U.S. stocks climbed to record highs on Wednesday and the benchmark 10-year Treasury yield fell sharply after the Federal Reserve abstained from reducing its bond buys. Rising for a fourth session, the S&P 500 index SPX +1.22%  rose to a an intraday record of 1,729.44, and ended at 1,725.52, up 20.76 points, or 1.2%. Utilities gained the most as investors were drawn to high dividend-yielding stocks. Extending gains into a fourth session, the Dow Jones Industrial Average DJIA +0.95%rose to an intraday record of 15,709.58. It ended at a record 15,676.94, up 147.21 points, or 1%.

"-Oil futures rallied on Wednesday after U.S. government data revealed a big weekly drop in crude supplies and the Federal Reserve maintained the pace of its bond purchases.

October crude oil CLV3 +0.47%  rose $2.65, or 2.5%, to settle at $108.07 a barrel on the New York Mercantile Exchange. Prices, which fell 1.1% in the previous session, traded at $105.73 before the government’s supply data and at $107.02 before the Fed announcement."
"-November Soybeans finished up 5 1/4 at 1347 3/4, 2 1/4 off the high and 12 3/4 up from the low. January Soybeans closed up 7 1/4 at 1350 1/4. This was 14 1/2 up from the low and 1 3/4 off the high. December Soymeal closed down 0.8 at 425.8. This was 3.0 up from the low and 2.7 off the high. December Soybean Oil finished up 0.47 at 42.71, 0.09 off the high and 0.68 up from the low. November soybeans closed slightly higher on the day with an inside trading session but this was still the second lowest close since August 23rd. The market traded both sides of unchanged early in the day and the close was near the highs of the day. News of China import demand and ideas that yield and acreage could come down for the October USDA update helped to hold the market above yesterday's lows. Private exporters reported the sale of 1.93 million tonnes of soybeans to China for the 2013/14 marketing year and 182,000 tonnes of US soybeans to unknown destination. The China sale is the 5th largest sale on record. With the low Brazil currency, strong global demand for soybeans and slower than expected demand from Brazil end users of feed and vegoil due to the high global soybean values, Brazil crush for soybeans for the February to July time frame has reached just 20.8 million tonnes, down 7% from last year's pace and down even with a record high crop. Indonesia plans to scrap 5% import duty on soybeans temporarily to ease some tightness there which is seen as a positive for global soybean prices. December soybean oil traded down to the lowest level since August 12th before closing sharply higher on the day and up 69 from the early lows. December meal closed slightly lower on the day. Traders see weekly export sales for soybeans for tomorrow morning near 700,000 tonnes from 478,100 tonnes last week."

FCPO- Recovery Imminent On Recent Fed Move 

Palm oil futures is likely getting some lift today amid recent recovery on Soy oil. Soy oil for December rose about 0.20 or 0.46% cents to 42.72 as the time of writing this article, 9.22a.m 19th Sept 2013. On the other note, regional stock index will have every reason to rise further today, including FKLI and stock index. Recent U.S Federal Reserve decision to continue their bond buying programme sent positive ripple not only to stock market, currencies but also certain commodities such as crude oil, gold, silver and also Soy bean plus Soy bean oil as well. Positive opening is likely to happen on FCPO Dec today judging from the positive re-action to the commodities market. Technically, market is still hovering on Bearish note even though the new benchmark month attempt to recover substantially after hitting day low a few times since last week. Prior to the Federal Reserve news, market is yet making any significant recovery that would turn this medium term Bearish momentum to positive momentum. Candle formation to comply for an early Bullish momentum pattern should be at least a higher low and a higher high (than previous major resistance level @ 2,373) form on hourly time frame. For today, pivot point for Dec contract is located around 2,312 while resistance is pegged at 2,340 followed by 2,358 level.

Daily Pivot Point
R2= 2358
R1= 2340
S1= 2312
S2=2302
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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