As for FCPO, market rose yesterday on strong 1-10 May exports, which were sharply higher than estimates. Adding support were strong gains in CBT soyoil and China Dalian futures. Lack of fresh sellers also underpinned sentiment. Gains were however, capped by the bearish MPOB April data which showed bigger than expected rise in stocks. Prices were 20 to 8 higher in the morning and rose to 34 higher in the afternoon on strong support late in the session.
Market showed good strength today as traders discounted the big increase in April stocks. The big jump in exports were encouraging with prospects of strong Chinese demand, following reports of low stocks, in the coming months. The Indonesian export levy may also draw more demand to Malaysia. However, better production in the coming months may see further increase in stocks which will cap gains.
Technical view - prices remain sideways in the 2200 - 2140 range. An effective break above 2200 will be positive.
Ringgit ~ 3.5980 / 3.6000 vs USD
As for other news...
€ European stocks were down on speculation the Greek debt crisis will not be resolved anytime soon. Greek government officials are meeting Eurozone finance ministers in Brussels today and Dutch Finance Minister Dijsselbloem, who is leading the gathering, said that an accord "will surely not be reached at today's meeting."
🇺🇸 San Francisco Fed President Williams said he expects the U.S. economy to rebound in Q2 from weakness in Q1 and that he also “expects unemployment to be down to 5.0% or even lower than that by the end of the year.” He reiterated that policy makers could raise interest rates at any meeting, depending on economic data.
🇺🇸 U.S. stocks closed lower, giving back some of Friday’s gains. Treasurys tumbled as the 10-year yield closed at its highest level in more than five months.
🇬🇧 As expected, the BOE maintained its benchmark interest rate at a record low 0.50% and kept its asset purchase target at 375 billion pounds following the conclusion of the policy meeting.
🇨🇳 China's Shanghai Composite surged 3% on the back of the country's latest policy support measures.
🇨🇳 China Apr CPI rose +1.5% y/y, weaker than expectations of +1.6% y/y. Apr PPI fell -4.6% y/y, weaker than expectations of -4.5% y/y.
🇯🇵 Japan's Nikkei 225 steadied at a seven-day high, but share for Sharp plummeted nearly 30% to 196 yen following the announcement of a capital-reduction report and preferred share issuance as part of its restructuring plan. Toshiba also nosedived 16.6% after canceling a dividend payment and withdrew its earnings outlook last Friday.
🇳🇿 Australia’s conservative government led by Prime Minister Tony Abbott faces a high-stakes test as it prepares on Tuesday to unveil its second budget. Some economists predict it may need to borrow more than 70 billion Australian dollars (US$55 billion) this year to plug a deepening revenue shortfall.
Oil prices slipped as the U.S. dollar strengthened and investors eyed concerns about weak demand in the physical market. In addition, speculation that the global oil supply glut will persist as EIA data shows U.S. Crude inventories are more than 100 million bbl above the 5-year average for this time of year.
Gold was little changed, as the impact of a rebounding dollar ahead of talks between Greece and euro zone finance ministers and weakness in the Chinese yuan against the dollar after the PBOC cut interest rates for the 3rd time in 6 months.
FCPO rose on strong 1-10 May exports, higher Soyoil and China Dalian. However, gain was capped by MPOB bearish data. Price remain sideway trading at 2140 to 2200.
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