As for FCPO, market eroded to its lowest level in nearly 2 weeks on bearish sentiment and absence of supporting factors. Selling was prompted by uncertainties over the Indonesian biodiesel mandate and no confirmation as yet on the CPO export levy. Increasing production in the coming months and weakness in soyoil and soyabean also weighed on sentiment. The slightly better 1-25 April exports had little effect. A strengthening ringgit, which rose about 0.5 pct vs USD today, will be negative. Prices were 7 to 31 lower in the morning and extended losses to 47 lower in the afternoon.
Slow demand and increasing production in the coming months are weighing on sentiment. April exports are likely to be around March levels, which will result in a big jump in stocks. There is also competition from bumper global soyabean supplies. However, prospects of El Nino and poor Indian monsoon will be supportive in the medium term if they materialize.
Technical view - the break below 2130 is slightly negative. Strong support seen at 2100, which if broken, will carry prices to 2000. Trend sideways ; RSI 38.14 ; support 2100 / 2080 / 2050 ; resistance 2150 / 2200 / 2250 / 2280.
In other news...
🇺🇸 U.S. stocks closed lower as investors eyed earnings and looked ahead to the beginning of the two-day Federal Reserve meeting on Tuesday.
The dollar fell against the euro and the yen amid concerns the Federal Reserve’s policy-making committee meeting this week could offer little guidance on the timing of its next interest rate increase.
€ European equities were higher, with investor sentiment boosted by a reshuffle of the team of Greek officials that are negotiating with its creditors. The German DAX finished higher by around 1.9% and Greek stocks posted gains of over 4%.
🇨🇳 The Shanghai Composite jumped 3% to a seven-year peak, while the Hang Seng Index rose to its highest level since December 2007. Investors brushed off weak data released at the market open; industrial profits for the first three months of the year fell 2.7% on year, the Statistics Bureau said.
🇯🇵 When Japanese Prime Minister meets with President Obama this week, the most important item on the agenda is the negotiation between Japan and the U.S. for a new trade deal that would set the stage for an agreement in the 12-nation Trans-Pacific Partnership.
USD/JPY is up +0.28% as the yen weakened after Fitch Ratings cut Japan's sovereign-credit rating to 'A' from 'A+' with a stable outlook.
Oil prices wavered, then settled lower, amid uncertainty about the strength of the recent price rally. Analysts say the market remains oversupplied and prices could be due for a pullback.
Gold prices notched their biggest gain (>2%) in more than three months after a summit between Greece and its eurozone creditors concluded with no progress made toward a solution to the country’s debt problems. Also, some dealers scrambled to cover short positions and the May options expiry triggered more buying.
FCPO eroded to its lowest level in 2 weeks. Selling due to the uncertainty over Indonesia biodiesel mandate, increasing productions in the coming month, and lower Soyoil price. The break below 2130 is slightly negative.
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