FCPO Related News (Fri, Jan 31)

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Wednesday due to speculative buying amid weather concerns in major soy-growing regions of South America and gains in other commodity markets. The benchmark April contract at Bursa Malaysia Derivatives ended 1.4% higher at 2,510 ringgit a metric ton after moving in a MYR2,474-MYR2,512 range. CBOT March soyoil was trading 0.9% higher at 52.19 cents a pound by the end of trade on BMD.

Concerns about dry weather in major soy exporter Argentina and talk that shipping issues in Brazil will likely limit the country’s ability to ship soy supplies in the near term helped fuel gains in palm oil. Technical indicators point to further price upside Thursday, rising toward MYR2,550/ton, as traders may cover positions ahead of the long weekend, according to a trading executive in Kuala Lumpur. "Chinese quality control officials’ decision to allow several [refined] palm oil cargoes to be unloaded in the country has lifted sentiment as well," he said. Financial markets in Malaysia will be closed Friday in observance of Federal Territory Day.

Five cargoes from Malaysia have been unloaded at various ports in China, a trader at an international trading corporation said, the first since the major vegetable oil consumer imposed stricter quality measures on refined cooking oils for food use from Jan. 1. Concerns about the tighter rules had prompted Chinese buyers to boost palm oil imports before the measures were enforced, raising port stocks to over 1 million tons in December. Palm oil port stocks in China reached 1.13 million tons Jan. 30.

Malaysian exports of refined palm oil, refined palm olein and refined palm stearin have dwindled since the start of the year with China’s new standards and its burgeoning port stocks. Export estimates by cargo surveyor Intertek Agri Services showed palm oil shipments to China during the Jan. 1-25 period fell 24% to 253,200 tons, while another surveyor, SGS (Malaysia) Bhd., said outbound sales for the period dipped 23% to 252,250 tons. Open interest on the BMD was 172,963 lots versus 177,786 lots Tuesday. One lot is equivalent to 25 tons. A total of 24,129 lots of CPO were traded versus 30,506 lots Tuesday.           [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,500 and 2,560 respectively.

FKLI Related News

NEW YORK (Reuters) - Stocks fell on Wednesday after the Federal Reserve said in its latest statement that economic growth had stalled but indicated the pullback was likely temporary. Stocks were flat for most of the session prior to the Fed statement at the end of a two-day policy meeting. The Fed repeated its pledge to keep purchasing securities until employment improves substantially. The statement followed data that showed the economy, as measured by gross domestic product, unexpectedly contracted in the fourth quarter. Economists stressed that the 0.1 percent contraction, caused partly by a plunge in government spending and lower business inventories, is not an indicator of recession.

The S&P 500 held above 1,500, seen by technical analysts as an inflection point that will determine the overall direction in the near term. The index is on track to post its best month since October 2011 and its best January since 1997. The Dow Jones industrial average (.DJI) was down 44.00 points, or 0.32 percent, at 13,910.42. The Standard & Poor's 500 Index (.SPX) was down 5.88 points, or 0.39 percent, at 1,501.96. The Nasdaq Composite Index (.IXIC) was down 11.35 points, or 0.36 percent, at 3,142.31. Giving the market extra support, private sector employment topped forecasts with the ADP National Employment report showing 192,000 jobs were added in January, higher than the 165,000 expectation.

The euro climbed to a 14-month high and gold rallied on Wednesday after the Federal Reserve left its monthly $85 billion bond-buying stimulus plan in place. Commodities rallied on Wednesday, with oil, corn and soybean prices hitting multi-week highs, propelled by encouraging economic data from Europe, a weak dollar and concerns about tighter supplies of raw materials. Brent crude touched a three-month high on Wednesday after better-than-expected economic data out of Europe spurred optimism about the global economy before oil pared gains with surprisingly weak U.S. growth numbers.

Stocks on Bursa Malaysia closed lower yesterday due to heavy selling pressure late yesterday morning  as the local market sentiment was dragged down by speculative market talks that the 13^th general election would be held soon. FKLI spot month contract opened slightly higher this morning at 1626.5. Today’s Support and Resistance for January contract is located around 1,610 and 1,634 respectively.

FCPO Related News (Wed, Jan 30)

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Tuesday on the back of hopes that shipments from Malaysia will rise as top producer Indonesia has decided to raise its CPO export tax for February. However, gains were limited by expectations that stockpiles in Malaysia will surge to another record high end-January, market participants said. The benchmark April contract on Bursa Malaysia Derivatives ended 1.2% higher at 2,476 ringgits a metric ton, after trading in a MYR2,446-MYR2,484/ton range.

Indonesia said Monday that it will increase the CPO export tax to 9% next month from 7.5% now, while Malaysia said it will keep its February CPO export duty unchanged at zero. "The tax hike will likely boost shipments from Malaysia next month. However, many are still worried about stocks hitting another high at the end of the month," a trading executive at a foreign commodities brokerage said.

Production in Malaysia in January is widely expected to be lower due to a seasonal drop in yields, but end-January stockpiles could rise to 2.66 million-2.70 million tons, beating end-December’s record high of 2.63 million tons, due to weak exports, analysts and planters said. The palm oil market could turn choppy in the holiday-shortened week, trading in a MYR2,400-MYR2,490/ton range as traders limit activity and move to the sidelines.

Investors will be eyeing January export estimates by cargo surveyors Intertek Agri Services and SGS (Malaysia) Bhd., due Thursday. Open interest on the BMD was 177,786 lots, versus 185,630 lots Friday. One lot is equivalent to 25 tons.           [Dow Jones Newswire]

Total traded volumes stood at 30,506 lots of 25 tonnes each, higher than the usual 25,000 lots. Technical analysis shows palm oil is expected to test a resistance at 2,486 ringgit per tonne, a break above which will lead to a further gain to 2,522 ringgit, said Reuters market analyst Wang Tao.

Shipments for the first 25 days of the month suffered a double-digit decline on lower Chinese and European demand, raising worries that stocks could still climb higher in January after hitting a record 2.63 million tonnes last month. Palm oil exports from Indonesia fell 4 percent to 1.9 million tonnes in December from the previous month, industry data showed on Tuesday.

Brent crude stayed above $113 on Tuesday on hopes that economic growth might be picking up in the world's largest oil consumer after a gauge of planned U.S. business spending rose in December, adding to recent positive global economic data.  In competing vegetable oil markets, U.S. soyoil for March delivery edged up 0.1 percent in late Asian trade. The most active September soybean oil contract on the Dalian Commodity Exchange closed 0.5 percent lower.          [Reuters]

Today’s Support and Resistance for benchmark April contract is located around 2,440 and 2,500 respectively.

FKLI Related News

NEW YORK (Reuters) - Stocks advanced on Tuesday, led by defensive sectors, in a sign the cash piles recently moving into the market are being put to use by cautious investors to pick up more gains. The S&P 500 is on track to post its best monthly performance since October 2011 and its best January since 1997 as investors poured $55 billion in new cash into stock mutual funds and exchange-traded funds in January, the biggest monthly inflow on record.

The Dow Jones industrial average has been flirting with 14,000, a level it hasn't seen since October 2007. Shares of Amazon.com (AMZN) jumped nearly 7 percent in extended trade after the world's largest Internet retailer posted fourth-quarter revenue that jumped 22 percent to $21.27 billion. The stock closed down 5.7 percent at $260.35 in regular trading.

Among rising defensive shares, which are companies relatively immune to economic swings, were drugmaker Pfizer (PFE), up 3.2 percent to $27.70 after posting earnings and AT&T (T.N), 1.6 percent higher at $34.68. "Cyclical were moving very nicely, now you see balance with some of the defensive. Many managers use that as an internal hedge in equity portfolios," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey. She said the market is cautious ahead of Wednesday's statement following the Federal Reserve's two-day meeting. In addition, defensive stocks would hold up better if Friday's payrolls report surprises on the downside. The top performing sectors on the S&P 500 were healthcare (.SPXHC) and telecom services (.SPLRCL), so-called defensive sectors, both up more than 1 percent.

Stock markets around the world rose and the dollar fell to a 14-month low against the euro on Tuesday amid rising risk appetite as the Federal Reserve began a two-day policy meeting in which it is expected to maintain its easy monetary policy. Oil and copper prices rose for a second straight day on Tuesday as strong U.S. housing market data bolstered confidence that economic growth and fuel demand were accelerating. U.S. crude oil rose more than 1 percent on Tuesday, exceeding gains in Brent crude.  

FKLI opened slightly higher this morning at 1,634.50 but trading sentiment remains cautious due to the shorter trading days this week as the market will be closed on Friday for Federal Territory Day. Today’s Support and Resistance for FKLI spot month contract is located around 1,616 and 1,639 respectively.

FCPO Related News (Tues, Jan 29)

Crude palm oil futures on Malaysia’s derivatives exchange ended lower Friday, weighed down by lower export demand and forecasts for improving weather in South American soy-growing regions. Market participants said prices stayed in narrow ranges as investors moved to the sidelines and squared off positions ahead of the long weekend. The benchmark April contract on Bursa Malaysia Derivatives ended 1.4% lower at 2,445 ringgits a metric ton after moving in a MYR2,442-MYR2,467 range.

Malaysia’s exports of palm oil fell 14% to 1.10 million tons in the Jan. 1-25 period, cargo surveyor Intertek Agri Services said. Another surveyor, SGS (Malaysia) Bhd., said exports for the same period fell 15% to 1.10 million tons.

India announced Wednesday that it would set a base price of $802/ton for CPO imports in a bid to prevent a flood of cheap palm oil from top producers Indonesia and Malaysia. "We are neutral on India’s news, as recent declines in CPO price should have priced this in previously," Alan Lim Seong Chun, an analyst at Kenanga Investment Bank, said. "In the long run, the new rule could prompt Indian refineries to use local CPO before importing from Malaysia and Indonesia."  Mr. Lim added that the major concern was Malaysia’s ample inventories. Tepid export demand could boost stockpiles to another all-time high at end-January. Planters tip end-January stockpiles to reach 2.66 million-2.70 million tons.

Open interest on the BMD was 185,630 lots, versus 181,117 lots Wednesday. One lot is equivalent to 25 tons. A total of 35,486 lots of CPO were traded versus 50,452 lots Wednesday.  The market was closed for a holiday Thursday.

Today’s Support and Resistance for benchmark April contract is located around 2,420 and 2,475 respectively.

FKLI Related News

U.S. stocks fell, following the longest rally for the Standard & Poor’s 500 Index since 2004, as a drop in pending home sales overshadowed a rise in durable- goods orders while investors watched earnings. 

The S&P 500 (SPX) fell 0.2 percent to 1,500.18 at 4 p.m. in New York. The equity benchmark closed above 1,500 last week for the first time since December 2007 after an eight-day rally. The Dow Jones Industrial Average lost 14.05 points, or 0.1 percent, to 13,881.93 today. The Nasdaq 100 Index added 0.2 percent to 2,742.43. About 6.1 billion shares traded hands on U.S. exchanges today, or 1.1 percent below the three-month average.

“The sentiment is really, really bullish,” Barry James, who helps oversee $3.5 billion as president of James Investment Research in Xenia, Ohio, said in a phone interview. “That is a little bit of a warning sign to us that we could be more in a topping phase than actually a new bull phase. It would take a lot to really convince everyone that happy days are here, and we can just ride this off into the sunset.”

The index of contracts for the purchase of previously owned homes fell 4.3 percent to 101.7 in December after a revised 1.6 percent increase in November, the National Association of Realtors reported today. The median forecast in a Bloomberg survey projected no change in the gauge.  A separate report showed orders for durable goods in the U.S. rose 4.6 percent in December after a 0.7 percent gain the prior month.          [Bloomberg)

FKLI  opened slightly higher this morning at 1636 but sentiments remain cautious in Malaysia due to this holiday-shortened week with only three trading days. Friday will be a public holiday in conjunction with The Federal Territory Day. Today’s Support and Resistance for January contract is located around 1,628 and 1,645 respectively.

FCPO Related News (Fri, Jan 25)

Crude palm oil futures on Malaysia’s derivatives exchange ended up Wednesday after choppy trade as investors covered positions amid supply concerns. Concerns about tight global vegetable oil supplies brought on by bad weather in soy-growing regions in South America and oil-palm growing areas in Malaysia provided the catalysts for palm oil’s upside, market participants said. The benchmark April contract at Bursa Malaysia Derivatives ended 0.6% higher at 2,481 ringgit a metric ton after moving in a choppy MYR2,450-MYR2,488/ton range. Malaysian markets will be closed Thursday for a public holiday.

CBOT March soyoil was up 0.2% at 52.54 cents a pound by the end of trade on the BMD. "Palm oil is now trading at a hefty discount to rival soyoil. Any weather issues in Latin America will likely drive up soy prices, steering price-conscious importers to palm oil," a vegetable oil exporter in the southern state of Johor said. Refined palm olein is currently offered $300-$350/ton cheaper than rival soyoil from Argentina, physical market data showed.

Tight  global  soy  supplies  and  expectations  for  palm  oil  demand  to  improve in  the  coming  months may   help   reduce   record   high   stockpiles   in   Malaysia , the  world’s  no.  2  producer, and  underpin  prices. Palm  oil  stocks  hit  an  all-time  high  of  2.63  million  tons  at  end-December , according  to   a   Jan. 10  crop  report  by  industry  regulator  the  Malaysian  Palm  Oil  Board.  Cash   CPO   for    prompt  shipment  was  offered  at  MYR2,350/ton. Open  interest   on   the   BMD   was   181,117   lots,   versus  176,684  lots Tuesday. One lot is equivalent to 25 tons. A total of 50,452 lots of CPO were traded versus 35,955 lots Tuesday.           [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,439 and 2,483 respectively.

FKLI Related News

NEW YORK (Reuters) - The smallest of gains gave the Standard & Poor's 500 its seventh straight winning day on Thursday, but the index failed to hold above the 1,500 line, restrained by Apple's worst day in more than four years. Apple Inc (AAPL) slid 12.4 percent to $450.50 a day after it posted revenue that missed Wall Street's forecast as iPhone sales were poorer than expected.

Economic data helped buoy equities as U.S. factory activity grew the most in nearly two years in January and new claims for jobless benefits dropped to a five-year low last week, giving surprisingly strong signals on the economy's pulse. At the same time, Chinese manufacturing grew this month at the fastest pace in about two years, while data suggesting German growth picked up boosted hopes for a euro-zone recovery. "PMI in Asia, Europe, and obviously, here in the United States, is moving in the right direction, and that's stuff people should be excited about," Polcari said.

The Dow Jones industrial average (^DJI) rose 46 points or 0.33 percent, to 13,825.33 at the close. The S&P 500 (^GSPC) inched up just 0.01 of a point, or 0 percent, to finish at 1,494.82. The Nasdaq Composite (^IXIC) dropped 23.29 points or 0.74 percent, to end at 3,130.38, with most of that loss on Apple's slide. Video streaming service Netflix Inc (NFLX) surprised Wall Street with a quarterly profit after it added nearly 4 million customers in the United States and abroad. Netflix shares surged 42.2 percent to $146.86, its biggest percentage jump ever.

Earnings have helped drive the stock market's recent rally. Thomson Reuters data through early Thursday showed that of the 133 S&P 500 companies that have reported earnings so far, 66.9 percent have exceeded expectations - above the 65 percent average over the past four quarters. About 6.8 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average during January 2012 of about 6.93 billion shares. Roughly five issues rose for every four that fell on both the NYSE and Nasdaq.           [Reuters]

Stocks on Bursa Malaysia closed higher Wednesday on continued buying support in selected blue-chips. FKLI spot month opened lower this morning at 1,628.50 as the market is likely to trade cautiously ahead of the long weekend due to the public holiday on Monday. Today’s Support and Resistance for January contract is located around 1,616 and 1,640 respectively.

FCPO Related News (Wed, Jan 23)

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Tuesday, reflecting investor concern about inclement weather in major soy- and oil-palm growing areas, South America and Malaysia, respectively.  The benchmark April contract at Bursa Malaysia Derivatives ended 1.9% higher at 2,465 ringgit a metric ton after moving in a MYR2,430-MYR2,474 range.

Concerns that dry weather in Argentina and Brazil could hurt soybean crops supported palm oil as both vegetable oils compete for similar export destinations. Malaysia, the world’s no. 2 palm oil producer, faces weather issues as well. Malaysia’s weather bureau said heavy rain is expected over the peninsular states of Pahang and Johor, which both account for about 30% of Malaysia’s palm oil production, raising concerns of a supply disruption. The two states produced 5.7 million tons of palm oil in 2012. Malaysia’s overall palm oil output last year was 18.79 million tons.

"Market sentiment improved somewhat following the Jan 1-20 export reports, as the fall [in shipments] was not as steep as Jan 1-15 numbers," a vegetable oil exporter in Pasir Gudang said. Cargo surveyor Intertek said Jan 1-20 exports fell 17% to 830,830 tons, compared with Jan 1-15 fall of 21% to 570,510 tons. Palm oil exporters said weather-related supply disruptions could prevent further stock builds in Malaysia, underpinning prices. They tip prices to rise toward MYR2,500/ton this week. Stockpiles at end-December rose to an all time high of 2.63 million tons, industry regulator the Malaysian Palm Oil Board said in a Jan. 10 report.

Open   interest   on   the   BMD   was  176,684   lots,  versus  176,691  lots  Monday. One  lot   is equivalent  to  25  tons.  A   total   of   35,955   lots   of   CPO   were  traded  versus  25,074  lots Monday.                   [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,450 and 2,500 respectively. 

FKLI Related News

NEW YORK, Jan 22 (Reuters) - Bank and commodity shares led the benchmark Standard & Poor's 500 Index to a fresh five-year closing high on Tuesday on hopes that the global economy continues to mend. Travelers' shares climbed after the insurer's results and lifted the Dow Jones industrial average to a new five-year closing high. On Friday, both the Dow and the S&P 500 ended at five-year highs after the quarterly earnings season got off to a solid start. On Monday, the U.S. stock market was closed in observance of the Martin Luther King, Jr., holiday.

In Tuesday's session, the market also gained on signals that Republican leaders in the U.S. House of Representatives aim on Wednesday to pass a bill to extend the U.S. debt limit by nearly four months to May 19. Jack de Gan, chief investment officer of Harbor Advisory Corp, in Portsmouth, New Hampshire, said better economic numbers in the United States and China, as well as more stabilization in Europe, were driving buyers into sectors associated with economic growth. "Any (bearish) news could turn us down for a day or so," he said, referring to the recent string of gains.

The Dow Jones industrial average rose 62.51 points, or 0.46 percent, to 13,712.21 at the close. The S&P 500 gained 6.58 points, or 0.44 percent, to 1,492.56. The Nasdaq Composite added 8.47 points or 0.27 percent, to 3,143.18. Tuesday's session marked the highest closes for both the Dow and the S&P 500 since December 2007. Technology shares underperformed as concerns about Apple's ability to continue to grow at hyper speed and a weak outlook from Intel Corp diminished optimism about the sector's prospects.

Signs of improved sentiment toward world growth were also seen in European bond markets. The yield on Portugal's benchmark 10-year note fell below 6 percent for the first time since late 2010 on news that the country was set to tap the bond market this week for the first time since it was bailed out in 2011.          [Reuters]

Stocks on Bursa Malaysia closed lower yesterday on continued foreign selling. FKLI opened lower this morning at 1,616 but may stage a rebound today after yesterday’s low of 1,601.50. Today’s Support and Resistance for benchmark January contract is located around 1,615 and 1,635 respectively. A break above 1,650 could signal a reversal from downtrend to uptrend.

FCPO Related News (Tues, Jan 22)

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Monday as investors covered short positions following weather concerns in soy-growing areas of South America. However, gains were limited by lower export demand forecasts by cargo surveyors for the Jan. 1-20 period, market participants said. The benchmark April contract on Bursa Malaysia Derivatives ended 0.8% higher at 2,420 ringgits a metric ton after moving in a MYR2,404-MYR2,428 range.

Concerns that dry weather in Argentina and Brazil could hurt soybean crops supported palm oil as both vegetable oils compete for similar export destinations. The tropical oil trades at a wide price discount of $300/ton to soyoil, which may spur price-sensitive buyers to opt for it. "Palm oil is supported by soy crop issues. CBOT soyoil may head toward 52 cents a pound," a Kuala Lumpur-based trading executive said, adding that this could pull up palm oil prices. CBOT January soyoil settled 0.4% higher at 51.68 cents Friday.

Still, palm oil’s upside will likely be limited as investors are wary of rising stockpiles in Malaysia due to lower shipments during the Jan. 1-20 period. Intertek Agri Services said outbound sales during the period fell 17% from a month earlier to 830,830 tons, while SGS put the figure at 813,778 tons, a decline of 20%. Shipments to China remained weak, data from the two surveyors showed. SGS put Chinese purchases at 193,300 tons, down 28%.

Investors are keeping a close watch on shipments to major consumer China following stricter quality control rules for cooking-oil imports into that country that came into effect Jan. 1. Open interest on the BMD was 176,691 lots, versus 181,478 lots Friday. One lot is equivalent to 25 tons. A total of 25,074 lots of CPO were traded versus 44,307 lots Friday.           [Dow Jones Newswire]

Malaysia's weather office issued a heavy rain advisory on Monday, saying intermittent rain may cause floods over low-lying areas that could disrupt production in key palm producing states of Pahang and Johor. A lower output may help ease Malaysian palm oil stocks, currently at a record-high 2.63 million tonnes, although traders point out that exports are also lower. Market participants will also be looking out for the impact of India's latest crude edible oils import duty of 2.5 percent which is aimed at curbing imports and protecting local refiners.          [Reuters]

Today’s Support and Resistance for benchmark April contract is located around 2,410 and 2,465 respectively.

FKLI Related News

Jan 21 (Reuters) - Malaysian stocks suffered their biggest drop in 16 months on Monday as investors woke up to the risks of what is expected to be the Southeast Asian country's closest national election. Speculation that Prime Minister Najib Razak would call the election has been swirling as far back as 2011, but his window for going to the polls is narrowing fast ahead of an April 28 deadline for dissolving parliament.

Investors have been luke-warm on Malaysian stocks for the past few months compared to most of its regional peers. On Monday, they rushed for the exits after rumours circulated online over the weekend that Najib was poised to hold the election as early as March. "People are worried about the elections. That's the trigger," said an analyst at a local investment bank who declined to be identified.The benchmark FBI KLCI stock index fell 2.43 percent to 1,635.63, its worst single-day drop since September 2011 as election nerves sparked selling across the board. Most other regional stock markets were steady on Monday.

The ringgit currency also fell, losing 0.5 percent against the dollar on stop-loss selling related to the slide in stocks. Among the biggest stock losers were government-linked firms whose close political connections would be at risk in the unlikely - but far from impossible - event of an opposition victory ending the Barisan Nasional coalition's 56-year rule. Autos-to-property conglomerate DRB-HICOM, controlled by tycoon Syed Mokhtar Al-Bukhary, fell 3.36 percent, while government-controlled Malaysian Airline slid 3.47 percent. Telecoms firm Axiata Group Bhd, majority owned by the government, plunged 5.12 percent, while government-linked bank CIMB Group Bhd lost 4.49 percent.

Malaysia's financial markets were caught napping in 2008 when shock gains by the opposition redrew the country's political map and sparked a 10 percent one-day plunge in the main index. The scope for a surprise is very much alive five years later due to a lack of reliable opinion polls and signs that the three-party opposition led by former deputy prime minister Anwar Ibrahim is mounting a well-organised campaign. Najib is widely expected to win, but a failure to secure the two-thirds parliamentary majority the coalition lost in 2008 could trigger ruling party infighting and a leadership battle within months.

A thin victory for the ruling coalition could lead to intense horsetrading as Anwar tries to form his own governing majority. "The biggest worry is a hung parliament. That would be terrible," said Kaladher Govindan, head of research at TA Securities, a local brokerage. "If it's a clear majority there can be a decisive growth agenda." He said the hefty losses by government-linked and telecoms firms on Monday could be a sign that investors were starting to shun defensive stocks and preparing to buy cyclical plays that should gain once election uncertainties ease.

So far this year, the Kuala Lumpur index has fallen 3.2 percent percent, underperforming its Southeast Asian peers. Its 14-day relative strength index is at 31.87, the lowest in the region. A level of 30 or lower indicates a market is oversold. Retail investors led the selling on Monday with a net 21.9 million ringgit ($7.2 million). One Kuala Lumpur-based equities trader said that foreigners were trimming positions ahead of the polls, adding that the election was likely to overshadow the market for the first half of this year. "Telecoms were among best performers last year, so they are selling targets," she added. Foreigners withdrew a net $42 million from Malaysian offshore equity funds in the last six months of 2012, while adding a net $129 million and $230 million to Philippine and Thai funds respectively.

European shares inched towards two-year highs on Monday, as a political attempt to break a budget impasse in the United States and expectations of aggressive Japanese stimulus bolstered the appetite for shares. Brent crude oil slipped below $112 a barrel on Monday, ending a three-day rally, as pessimism over global economic growth returned traders' focus to healthy supply levels, offsetting fears of unrest in North Africa.           [Reuters]

FKLI spot month contract opened slightly lower this morning at 1,623 but soon dropped sharply to a low of 1,601.50 as  jitters over impending national elections continued to affect investor sentiment since yesterday.  Today’s Support and Resistance for January contract is located around 1,591 and 1,635 respectively.

FCPO Related News ( Mon, Jan 21)

Malaysia Jan 1-20 Palm Oil Exports is 830,830 Tons, Down 17% [Intertek]

Crude palm-oil futures on Malaysia’s derivatives exchange ended higher Friday as investors covered short positions ahead of the weekend. However, palm oil’s upside remains limited as a result of persistent concerns about ample palm-oil supplies in Malaysia owing to export worries following an Indian import tax on crude edible oils, market participants said. The benchmark April contract at Bursa Malaysia Derivatives ended 0.9% higher at 2,400 ringgit a metric ton after moving in a MYR2,377-MYR2,418 range.

India, the world’s biggest vegetable-oil buyer, imposed a 2.5% import duty on crude edible oils Thursday to thwart an influx of cheap imports and protect domestic oilseed farmers. "India’s import-tax rate on crude edible oils wasn’t as drastic as previously feared. Given that India is a very price-sensitive market I doubt the consumption pattern of the country’s consumers will change much seeing as palm oil is still the cheapest cooking oil compared to other vegetable oils," a vegetable-oil exporter in Kuala Lumpur said. "India will continue to buy CPO." At current prices refined palm products are offered $350-$370/ton cheaper than rival soy oil and a hefty $400/ton discount to rapeseed oil.

Palm-oil prices face limited upside in the week ahead pressured by record high palm-oil stockpiles in Malaysia–the world’s No. 2 producer–in spite of setting no tax on crude palm oil exports for January. "Prices will have to ease further toward MYR2,250/ton to stimulate more demand," an analyst at a Kuala Lumpur-based bank said. In October, Malaysia said it will reduce export taxes for the crude grade from 23% to a graduated basis ranging from 4.5% to 8.5%, increasing as palm prices rise from MYR2,250/ton, in a bid to regain market share lost to Indonesia and to help flesh out excess stocks. There is no tax now because the reference palm-oil price is below MYR2,250/ton.           [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,378 and 2,425 respectively.

FKLI  Related News

World equity and oil prices rebounded on Friday after Republican leaders of the U.S. House of Representatives said they would seek to break a budget impasse next week, while the yen hit a 31-month low against the U.S. dollar ahead of potential asset purchases by the Bank of Japan. [Reuters]

U.S. stocks rose for a third week, driving benchmark indexes to five-year highs, as earnings from companies including General Electric Co. and Goldman Sachs Group Inc. beat estimates and debt-limit talks progressed. Energy, industrial and consumer companies climbed the most among 10 groups in the Standard & Poor’s 500 Index as GE (GE) rallied 4.3 percent.

A gauge of homebuilders rose to the highest level since 2007 amid better-than-expected housing data. Morgan Stanley jumped 11 percent after reaching profit-margin targets six months ahead of schedule. Dell Inc. surged 18 percent amid reports it’s in buyout talks. Bank of America Corp. and Intel Corp. sank at least 3.4 percent on disappointing results. The S&P 500 (SPX) rose 1 percent to 1,485.98, extending its 2013 advance to 4.2 percent. The Dow Jones Industrial Average added 161.27 points, or 1.2 percent, to 13,649.70. Both measures closed at their highest levels since December 2007.

Equities rose as about 72 percent of the 67 S&P 500 companies that have reported quarterly results beat estimates. Economic reports showed retail sales advanced more than forecast in December and housing starts climbed 12 percent, capping the best year for the industry since 2008. Confidence among American households unexpectedly fell to a one-year low this month, as higher payroll taxes create a risk that the biggest part of the economy will slow in early 2013.

The benchmark index rallied on the final day of the week after Speaker John Boehner said House Republicans plan to vote on a three-month extension of U.S. borrowing authority in an effort to force the Democratic-led Senate to adopt a budget plan. Lawmakers in Washington remain divided about raising the debt ceiling and cutting government spending. The Treasury Department has said the U.S. will exceed its $16.4 trillion borrowing authority sometime from mid-February to early March. Since 1960, Congress has raised or revised the limit 79 times, including 49 times under Republican presidents, according to the department.          [Bloomberg]

Stocks on Bursa Malaysia closed lower last Friday in spite of advances in regional markets lifted by upbeat economic data from the US and China. FKLI opened sharply lower this morning at 1,657 and is likely to continue its correction and consolidation mode. Today’s Support and Resistance for January contract is located around 1,647 and 1,675  respectively.

FCPO Related News (Fri, Jan 18)

SINGAPORE, Jan 17 (Reuters) - Malaysian palm oil futures fell on Thursday after India imposed an import duty on crude palm oil imports, a move that could hurt demand and leave stocks near record highs. India, the world's biggest buyer of vegetable oils, has set a 2.5 percent import duty on crude edible oils to stem imports and protect domestic oilseed growers. Traders fear demand may take a further hit from the move after Malaysian exports suffered a 20 percent decline for the Jan. 1-15 period from a month ago. "The market reacted negatively to the import duty," said James Ratnam, a research analyst with TA Securities in Malaysia. "But we are mindful that the duty may be too small to really have an impact on crude palm oil demand."

The benchmark April contract on the Bursa Malaysia Derivatives Exchange lost 2.1 percent to close at 2,378 ringgit ($789) per tonne. Total traded volume surged to 45,433 lots of 25 tonnes each, compared with the usual 25,000 lots, as the news triggered a sell-off. Technical analysis showed that Malaysian palm oil may end its current rebound around resistance at 2,449 ringgit per tonne, retracing to 2,403 ringgit, said Reuters market analyst Wang Tao.

Malaysia, which neighbours top producer and rival Indonesia, has been struggling with record stocks since September due to tepid global economic conditions and the euro zone crisis, which have stifled demand and caused prices to tumble 23 percent in 2012. While end-stocks are expected to slowly shrink in the first quarter of the this year on the back of seasonally slowing production, sluggish exports could crimp any recovery in prices. "For December we have stocks at 2.63 million tonnes. My assumption is that we are not going to see a 3 million tonne stock level, but it all depends on how exports play out for the rest of the month," said Ker Chung Yang, an analyst with Phillip Futures in Singapore.

Brent futures steadied near $110 per barrel on Thursday after Islamist militants attacked an Algerian gas field and took Western hostages, although concerns about a weak global economic outlook and demand worries weighed. In other vegetable oil markets, U.S. soyoil for March delivery fell 0.6 percent in late Asian trade. The most active May soybean oil contract on the Dalian Commodity.          [Reuters]

Some traders said India’s tax imposition may not be completely negative for Malaysia. "The news is not entirely bearish for Malaysian CPO exporters," a trading executive at a Malaysia-based vegetable oil exporting firm said. "Indonesia has an existing tax of 7.5% on CPO shipments, while Malaysia’s rate is set at zero." Thus palm oil from Malaysia is still cheaper, he said. The world’s no. 2 producer Malaysia said in October it would cut export taxes on CPO from Jan. 1, in a bid to regain market share from Indonesia.

The export tax rate on CPO for January and February is set at zero, compared with Indonesia’s export duty of 7.5% on CPO in January. Both Indonesia and Malaysia account for around 85% of global palm oil exports. Palm oil could rebound from Thursday’s fall, as investors will likely square off riskier positions ahead of the weekend, a Kuala Lumpur-based broker said, tipping Friday’s trade in a MYR2,385-MYR2,450/ton range.

In the cash market, refined palm olein for January was offered at $800/ton while cash CPO for prompt shipment was offered at MYR2,230/ton. Open interest on the BMD was 179,036 lots, versus 175,844 lots Wednesday. One lot is equivalent to 25 tons. A total of 45,433 lots of CPO were traded versus 35,249 lots Wednesday.           [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,360 and 2,410 respectively.         

FKLI Related News

Stocks rallied following encouraging news on the U.S. economy, potential progress over the debt ceiling, and talk of central-bank stimulus in Japan. The Dow Jones Industrial Average rose 84.79 points, or 0.6%, to 13596.02. The blue chips neared a five-year closing high but fell just short ahead of the session's close. The Standard & Poor's 500-stock index added 8.31 points, or 0.6%, to 1480.94. The Nasdaq Composite Index advanced 18.46 points, or 0.6%, to 3136.

Indexes churned higher in afternoon trading after House Budget Committee Chairman Paul Ryan said Republicans are discussing whether to support a short-term increase in the debt ceiling. "We've got a relief rally today, but this just pushes back the rancorous debate," said John Canally, investment strategist and economist with LPL Financial. Earlier, the rally revved up as Japanese news outlet Nikkei reported the Bank of Japan is planning further action to stimulate the economy. In the U.S., housing starts jumped in December more than economists had expected. Building permits also rose in December, mostly in line with expectations. Consumer-discretionary stocks, which include home builders, led the S&P 500 higher. Toll Brothers TOL +3.58%rose $1.25, or 3.6%, to $36.16, D.R. Horton DHI +2.52%advanced 53 cents, or 2.5%, to 21.53, and PulteGroup PHM +5.33%gained 1.03, or 5.3%, to 20.37.

In other economic news, jobless claims fell more than expected in the latest week, and a reading indicated business conditions for mid-Atlantic manufacturers unexpectedly contracted. Bank shares in the S&P 500 posted the only sector decline Thursday. "Financial shares had a pretty good year last year, and earnings expectations for this year and next are pretty mundane," said Paul Atkinson, head of North American equities for Aberdeen Asset Management, ADN.LN -1.71%which oversees $300 billion in assets.

FKLI opened higher this morning at 1,688 following the bullish momentum on Wall Street as encouraging economic data and potential progress over the debt ceiling brought back some investor confidence. Today’s Support and Resistance for January contract is located around 1,680 and 1,692 respectively.

FCPO Related News (Thurs, Jan 17)

Crude palm oil futures on Malaysia’s derivatives exchange ended higher Wednesday on speculative buying interest, amid gains in CBOT soy oil during Asian hours. But the rise in palm oil was limited as market sentiment is generally cautious due to uncertainty over exports to major importer China brought about by stricter quality control measures imposed Jan. 1, and despite Malaysia leaving its export tax at zero for February.

The new benchmark April contract at Bursa Malaysia Derivatives ended 0.6% higher at 2,430 ringgit a metric ton after moving in a range of MYR2,423 to MYR2,444. CBOT March soyoil was 0.2% higher at 50.98 cents a pound at the end of trade on the BMD.  "The zero export tax announcement lent some support to the market," said LT International head trader Chandran Sinnasamy. "But palm oil’s upside remains limited as there’s limited cargo inquiries from China while another major importer India is sitting on ample port stocks, after strong purchases in the last three months."

Palm oil is likely to ease toward MYR2,390/ton in the near term, Mr. Sinnasamy said. Indian palm oil purchases reached 628,618 tons in December, an increase of 44% from a year earlier, whereas refined palm purchases rose 28% to 137,475 tons after a dip in prices stoked demand, the Solvent Extractors Association of India said in a statement Tuesday. Cooking oil stocks at Indian ports totaled 1.46 million tons as of Jan. 1, it said. Top palm oil producing countries Indonesia and Malaysia have ample supplies as well. Malaysia, the world’s No. 2 producer, said last week stocks reached an all time high of 2.63 million tons at the end of December, though analysts and planters expect that figure to drop in the coming months as yields are seasonally lower.

In the cash market, refined palm olein for January was offered at $810/ton, and cash CPO for prompt shipment was offered at MYR2,250/ton. Open interest on the BMD was 175,844 lots, versus 173,608 lots Tuesday. One lot is equivalent to 25 tons. A total of 35,249 lots of CPO were traded versus 42,040 lots Tuesday.

Today’s Support and Resistance for benchmark April contract is located around 2,400 and 2,460 respectively.