SINGAPORE, March 18 (Reuters) - Malaysian palm oil futures edged lower on Monday, as traders turned cautious after a radical bailout proposal for Cyprus rattled investors and triggered a broad-based decline in commodities and financial markets.
Euro zone finance ministers asked Cyprus savers to forfeit a portion of their deposits in return for a 10 billion euro ($13 billion) bailout for the island, sparking fears of fresh turmoil in the euro zone and worries about global demand. "It seems like Europe is back to the headlines for the wrong reasons," said Ker Chung Yang, investment analyst with Phillip Futures in Singapore. "We have probably seen the last of the rally last week, and this week could be the beginning of a downturn or corrections in the commodities market."
The benchmark June contract on the Bursa Malaysia Derivatives Exchange fell 1.4 percent to close at 2,383 ringgit ($761) per tonne, also its low for the day. Prices traded in a tight range between 2,383 to 2,415 ringgit. Total traded volume stood at 27,137 lots of 25 tonnes each, slightly higher than the usual 25,000 lots. Technical analysis indicates Malaysian palm oil is expected to revisit its March 14 low of 2,360 ringgit per tonne, as a rebound from this level has completed, said Reuters market analyst Wang Tao.
Palm oil futures also continued to come under pressure from a weak soy market, which is suffering from poor U.S. demand and higher South American supply, losing 1.4 percent last week. But seasonally lower output in Malaysia may help ease palm oil stocks and support prices, especially after cargo surveyor data on Friday showed firm export demand. Malaysian palm oil shipments for the first half of the month were slightly better compared to the same period last month, with cargo surveyors Intertek Testing Services and Societe Generale de Surveillance reporting a 0.2 and 4.6 percent increase respectively.
In other markets, crude oil dropped to below $109 a barrel on Monday as stock markets tumbled and the dollar strengthened on the bank bailout proposal for Cyprus. In other vegetable oil markets, U.S. soyoil for May delivery lost 0.8 percent in late Asian trade. The most-active September soybean oil contract on the Dalian Commodities Exchange also dropped 0.4 percent. [Reuters]
Today’s Support and Resistance for benchmark June contract is located around 2,380 and 2,435 respectively.
No comments:
Post a Comment