Market Factors to Watch |Wednesday, 29 January 2014 ==================================== GLOBAL MARKETS ==================================== • U.S. STOCKS — U.S. stocks rose on Tuesday after the S&P 500s three-session slide, but an unexpected drop in durable goods orders in December and Apples disappointing iPhone sales kept investors on edge. The Nasdaq underperformed the broader market, pressured by Apple Inc shares, which plunged after holiday iPhone sales missed expectations. The shares of Apple suppliers such as Qualcomm Inc and Cirrus Logic Inc also tumbled and pulled on the Nasdaq. Orders for long-lasting U.S. manufactured goods unexpectedly fell 4.3 percent in December, and a gauge of planned business spending on capital goods also slid, which could cast a shadow on an otherwise bright economic outlook. The durable goods report preceded the start of a two-day policy meeting of the U.S. Federal Reserve. Investors will closely watch the outcome of the meeting to see if the Fed will announce another $10 billion reduction in its monthly bond-buying program. On Tuesday, the Dow Jones industrial average rose 75.84 points or 0.48 percent, to 15,913.72. The S&P 500 gained 8.19 points or 0.46 percent, to 1,789.75. The Nasdaq Composite added just 0.336 of a point or 0.01 percent, to 4,083.945. • U.S. TREASURIES — U.S. Treasuries prices edged up on Tuesday after data showing an unexpected fall in orders for U.S. durable goods in December spurred safe-haven bids, but nervousness ahead of the Federal Reserves policy decision capped gains. The new supply helped limit gains in Treasuries prices, along with uncertainty surrounding the outcome of the Feds two-day policy meeting. The Fed will release its policy decision at the close of the meeting on Wednesday afternoon. The U.S. central bank is considering whether to further scale back its bond-purchase program, which is aimed at holding down long-term borrowing costs to help the economy. Emerging market assets stabilized on Tuesday after three straight sessions of intense selling, but signs of trouble in developing economies remained fresh in traders minds and contributed to the modest flight to quality in Treasuries. Investors waited to see if Turkey would hike interest rates to defend its battered lira currency. • FOREX — The dollar rose modestly against the yen and euro on Tuesday as investors stepped back into stocks and emerging markets whose recent sell-off had driven money into safe-haven currencies. The greenback might receive another boost if the Federal Reserve were to further pare its bond-purchase stimulus despite data suggesting the U.S. economy lost some momentum at the end of 2013. U.S. central bank officials began a two-day policy meeting on Tuesday, at which analysts expect the Fed to decide to reduce its monthly bond purchases in February by $10 billion to $65 billion. Such a move is perceived as positive for the dollar since it would reduce the amount of cash the Fed injects into the banking system, although the Feds tapering which began in December has hurt emerging market currencies because the dollars created had flooded into fast-growing nations in Asia, Africa and Latin America. The dollar in the meantime held steady against the euro and recovered further against the yen in the wake of a much weaker-than-expected reading on U.S. durable goods orders in December. The dollar rose 0.3 percent against the yen at 102.84 yen after hitting a seven-week low last Friday. The euro dipped 0.06 percent against the greenback at $1.3661, retreating from an approximately 3-1/2-week high set last Friday. • GOLD — Gold fell on Tuesday, extending the previous sessions 1 percent drop, as global equities rebounded from a one-month low and emerging markets stabilized after three days of intense selling. Liquidation pressure related to an option expiry and encouraging data on U.S. consumer confidence also weighed down golds safe-haven appeal. The precious metal was under pressure on speculation that the Federal Reserve will make a $10 billion cut to the U.S. central banks $75 billion monthly bond-buying stimulus. Fed tapering worries were a major factor in golds 28 percent price crash last year. Spot gold was down 0.4 percent at $1,250.80 an ounce by 2:56 p.m. EST (1956 GMT). U.S. COMEX gold futures for February delivery settled down $12.60 an ounce at $1,250.80, with trading volume about 25 percent above its 250-day average. Trading volume was about 25 percent higher than its 250-day average, preliminary Reuters data showed. Traders said selling related to Tuesdays expiration of COMEX February options also pressured gold futures prices. Over-the-counter gold options are scheduled to expire on Wednesday. • BRENT — Brent futures rose to $107 a barrel on Tuesday as the steepest fall in three weeks prompted fresh buying, with concerns of turmoil in emerging economies and a slowdown in China keeping the gains in check. Oil also drew support from expectations of a steep fall in U.S. distillate inventories, which would indicate ongoing robust demand for heating oil because of bitter winter cold in northern countries. That helped crude futures diverge from Asian shares, which remained near five-month lows. U.S. oil gained 18 cents to $95.90, after sliding the most since January 13. Brent crude touched a high of $107.10 a barrel and was up 25 cents at $106.94 by 0725 GMT. Brent fell $1.19 in the previous session, its biggest decline since January 2. • NIKKEI — Japans Nikkei average fell to a fresh two-month low on Tuesday as investors stayed cautious before the Federal Reserves policy meeting, while suppliers to Apple Inc took a hit after the tech giants iPhone sales and revenue forecast fell short. The Nikkei shed 0.2 percent to 14,980.16, its lowest close since November 14, having erased earlier gains. ==================================== MALAYSIA ==================================== • PALM OIL — Malaysian palm oil futures dropped to their lowest in almost two weeks on Tuesday, hit by a decline in other vegetable oil prices and fragile equity markets, but a weak local currency helped curb losses. The benchmark April contract on the Bursa Malaysia Derivatives Exchange ended 1.1 percent lower at 2,529 ringgit ($760) per tonne. Prices earlier reached a low of 2,519 ringgit, a level not seen since Jan. 15. Total traded volume amounted to 35,987 lots of 25 tonnes, slightly above the usual 35,000 lots. • COMPETING VEGOIL — May soybeans oil contract, the most active on the Dalian Commodities Exchange declined 1.8 percent to its lowest level since 2006. Emerging markets steadied after three days of intense selling due to concerns that slower growth in China and reduced U.S. monetary stimulus could hurt some economies dependent on exports and foreign capital. • FBM KLCI — Gains in Tenaga helped lift the FBM KLCI, closing Tuesday firmer against a weaker regional sentiment, as investors were concerned on Fed’s plan to cut stimulus. At 5pm, the KLCI closed up 2.37 points or 0.13% to 1,781.25. Turnover was 1.36 billion valued at RM1.86bil. There were 352 gainers, 331 decliners and 321 counters unchanged. ==================================== CLOSING PRICES FOR U.S. MARKET Tuesday, 28 January 2014 ==================================== • DJIA Up 90.68 points at 15,928.56 • NASDAQ Up 14.35 points at 4,097.96 • S&P 500 Up 10.94 points at 1,792.50 • US Soybean Oil [Mar’14] Up 0.34 points at 37.40 metric ton • NYMEX Light Sweet Crude Oil (WTI) [Mar’14] Up 1.69 points at 97.41 a barrel • US COMEX Gold [Feb’14] Up 1.69 points at 97.41 dollars an ounce ==================================== CLOSING PRICES FOR CHINA MARKET Tuesday, 28 January 2014 ==================================== • DALIAN SOYBEAN (May 14) closed down 13 at 4696 • DALIAN SOYBEAN OIL (May 14) closed down 116 at 6436 • DALIAN PALM OIL (May 14) closed down 124 at 5660 ==================================== CLOSING PRICES FOR MALAYSIA MARKET Tuesday, 28 January 2014 ==================================== • FCPO (April 14) closed down 24 at 2,532 • FKLI (Jan 14) closed up 2.0 at 1,782.5 • FBM KLCI closed up 2.37 points to close at 1,781.25 • FGLD (Jan 14) closed down 1.80 at 134.65 • FGLD (Feb 14) close down 2.10 at 134.65
Posted on: Wed, 29 Jan 2014 02:29:56 +0000
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