Market Update - 1 April 2013

· The focus this week will likely be the ECB monthly press conference, though Cyprus and Italy will be tough to keep off the front page.

· As usual the Media needs dramas and there has been plenty of it in Cyprus. It would be a pity if this were to dominate too much of the ECB’s press conference, which, after all, is supposed to be about monetary policy.

· Cyprus is actually pretty small in EU context, and Draghi should focus on what is happening in the rest of the eurozone, which accounts for 99.8% of GDP

· USDMYR traded sideways in US last Friday night as most are away on a long Easter weekend. Markets are weary of the every closer inching of the GE and we continue to expect a range trade on the pair at 3.0800-3.1200 in the short term.

· Although markets are not particularly reacting drastically to the issues in EU, what is going on there is definitely not good. The flash PMI for the eurozone was down, and the Economic Sentiment indicators is weak, showing that the economy is mired in recession – not a very deep one, but a recession nonetheless. Even German data fell back. And this was before the impact of Cyprus will have been felt. And yes let’s not forget France.

· EURUSD still trading around the 1.2800 handle while USDJPY is holding up at the support level of 94.30, I expect more buyers should the pair track back towards 92.80 and 92.00.

Market Update - 29 March 2013

• Stocks rallied, sending the S&P 500 Index to a record, as the reopening of Cyprus banks with new rules curbing access to cash eased concern about Europe’s debt crisis.

• Confidence among US consumers fell to a six-week low and claims for jobless benefits rose more than forecasted, highlighting the risks to the economy posed by federal government budget cuts. US Q4 GDP rose at a 0.4% annual rate.

• The euro hovered near four-month lows against the dollar, mainly due to the political deadlock in Italy and worries that the Cyprus bailout could cause panic amongst investors in other euro zone debt.

• Cyprus averted panic withdrawals as banks opened for the first time in almost two weeks, with government controls on access to cash leading to orderly lines rather than runs on deposits.

• Japan’s manufacturers predict a rebound in production this month after the deepest slide since the aftermath of the March 2011 earthquake, with the central bank poised to step up monetary stimulus next week.

• USD/MYR opened lower this morning, below 3.1000, expected trading range for today 3.0800 – 3.1000

Market Update - 28 March 2013

• Europe continue to be on the drag as Italy failing to form a government, which will lead to fresh elections, and fear of contagion from Cyprus has caused markets to be on a bearish mode.

• Cyprus has deployed hundreds of security guards to help maintain order after the government announced capital controls that will limit daily cash withdrawals to €300 and a cap of €1,000 that can be taken out of the country by an individual. The measures will apply to all banks, not just the two largest covered in the restructure; banks are due to open for the first time in almost two weeks tomorrow. 5 board members of the Bank of Cyprus tried to resign, before having their resignations rejected - ICAP

• To make it more shaky in Europe, Moody’s declared that they doubted market conditions were benign enough to avoid contagion to other peripherals, “We think that that confidence may well be misplaced.”

• USDMYR didn’t show much change or reaction to the news in Europe and continue to trade in the 3.1000 handle. Range for the week, 3.0800-3.1200.

• There is a huge increase in risk premium for holding deposits anywhere in Europe has hugely increased, particularly in the periphery, and that will lead, at best, to an increase in borrowing costs and a squeeze on capital at the most troubled banks.

• All across Europe markets were down, the EURUSD was down 90 pips on the night to 1.2773, the lowest since November, while Eurostoxx fell 1.09%.

• In the US, things followed the sentiment, DOW is down just 0.23% and the S&P off 0.03% as several dovish Fed members talked down the chances of an early exit and despite pending home sales softening up for a second month.

• Meanwhile France and the UK both confirmed a Q4 contraction with final GDP printing -0.3% in both countries. Italian industrial orders grew less than expected but an upward revision to last month’s figures actually lifted the annual pace of decline to -3.3% from -15.3%. F

Market Update - 27 March 2013

• Overnight, it was relatively quiet in comparison, not much new on Cyprus, more a case of enforcing the restructure & soothing mkt confidence in Italian/Spanish/French Banks..

• Only one EU Data out yesterday, March French Consumer Confidence which at 84pts was under the 86pt survey and at a 4 month low....hardly surprising given the last 2 weeks.

• USDMYR today is still trading around the 3.1000 handle and I don’t see much change from the range of 3.0800-3.1200, except of course unless we have a sudden announcement of elections that might send some USDMYR buyers in.

• In the US, data continues to show positive signs, strong US Housing numbers saw the Case Shiller price index print its biggest monthly rise since 2006. New Home Sales were also strong.

• The US Durable Goods headline was above survey but weak ex-transport. Still the market chose to be optimistic with equities rallying over the release.

• March Consumer Confidence & the Richmond Fed Manufacturing Index both missed the mark but are both still in positive territory.

Market Update - 25 March 2013

• New week, new start and we guess we can expect politics to drive near-term risk appetite, but an approaching peak in growth momentum suggests limited risk sentiment ahead. The key risk is weaker growth exacerbating political uncertainty in Europe and of course Cyprus now, but who’s next?
• Honestly,we see limited contagion risk from the situation in Cyprus. Overall, markets seem to be cautious of Euro zone investments but odd enough on Saturday’s Business Times Singapore, PIMCO’s euro zone debt head fund manager actually said despite the woes they still like Europe.

• Italian and Spanish bonds rose this week as investors bet the European Central Bank’s pledge to buy the securities of struggling countries would prevent turmoil in Cyprus from spreading to other high debt and deficit nations.

• USDMYR looks like a good day to buy so far, the pair dipped back down below 3.1000 this morning on profit taking and news of some oil players selling USDMYR. Interesting to track the pair this week to see where it might be heading, a firm break of 3.1000 might see it trade back towards 3.0800 but if it’s a false break then we can see it trade back to the 3.1000-3.1300 range.

• Picked this up in one of the mails this morning, “It will also be important to monitor the political developments in Portugal not only over this week but also over the next month. Last Friday, the Socialist Party, the biggest opposition party, announced in parliament that it will submit a no-confidence vote to overthrow the government, saying that the country was on the verge of an economic and social catastrophe. The vote could be submitted either this week or on the week after Easter.”

• AUDUSD continue to trade higher, currently trading at 1.0450 with upside maybe around 1.0550, but RBA could come in and cap the pair at 1.0600, market is probably positioned to buy on dips.

Malaysia Palm Oil ITS Data 1-25 March 2013

ITS (1-25 Mar) = 1067140 v 1153852 (down 7.52%)

Malaysia Palm Oil SGS Data 1-25 March 2013

SGS (1-25 Mar) = 1055914 v 1134872(do​wn 6.96%)

Market Update - 21 March 2013

• Wall Street recovered after a 3-day losing streak with DOW +0.39%, S&P +0.67% and Nasdaq +0.78% after Bernanke announced that the Fed will continue to hold its aggressive efforts to stimulate the economy.

• Cyprus banks are expected to close until the end of the week. The Cypriot Parliament rejected the bank deposit levy and Cyprus is in the midst of seeking rescue from Russia, although no deal has reached at the first meeting.

• New Zealand economy grew at the fastest pace in three years last quarter, led by retailing and the rebuilding of earthquake-damaged Christchurch city, sending the NZD higher. GDP rose 1.50% (exp 0.90%) in the last quarter of 2012.

• USD/JPY rallied, Nikkei news reporting that the Bank of Japan may be calling for “bold easing”

• Asian stocks advanced as the Fed said it will continue stimulating the US economy and amid reports Japan’s new central bank governor may announce a more aggressive policy stance

• USD/MYR opened lower this morning, today’s trading range expected between 3.1100 – 3.1250

Malaysia Palm Oil SGS Data 1-20 March 2013

SGS (1-20 Mar) = 922987 v 811722(up1​3.71%)

Does My Tween Really "Need" a Cell Phone?

By Risa Green 

My daughter, who is nine, keeps pestering me about a cell phone.

As in, when can she have one. As in, so many of her friends have them (so many equaling three, and they all have divorced parents who want to be able to call them directly).

I keep telling her that we’ll discuss it when she’s older, because right now, I don’t really see the point of her having a cell phone. I mean, who is she calling? And where does she think she’s going all by herself that would require her to need to make phone calls?

In what I imagine she thought was a subtle attempt to persuade me otherwise, she recently asked how old I was when I got my first cell phone. Twenty-five, I informed her. I left out the part about how that’s because they hadn’t been invented before then, because it was just more fun to watch her mouth hit the floor and the wheels spin in her head as she tried to come up with a different approach.

But then here’s what happened: we went skiing over winter break, and one afternoon we decided to ditch ski school and lessons and just ski together as a family, which isn’t something we do very often because we’re all at different skill levels. My husband is an expert skier, my daughter thinks she’s an expert skier, I’m a fairly decent skier, but I’m slow and I’m scared of anything steep or icy or bumpy or crowded, and my son is somewhere between advanced beginner and crying every time he falls down, which is often.

So anyway, we decided to ski together on a pretty basic blue run, which happens to fork off to another run in the middle of the mountain. My husband stayed with my son so that he could follow his turns, I stayed behind both of them because, as I mentioned, I’m slow, and my daughter, who was frustrated and annoyed with all of us, took off down the mountain ahead of us. And by the time the rest of us reached the fork, she was nowhere to be found.

Now mind you, my daughter has skied at this resort at least a dozen times, and it’s a point of great pride for her that she knows every run and every lift like the back of her hand. She also wears a black helmet cover with an enormous hot pink and neon orange synthetic “ponytail” sticking out of it, so she’s kind of hard to miss. My point being, that I was not at all panicked. There were only two ways she could go, they both led to lifts, and we knew she’d be at one or the other. So my husband and my son and I picked a side, which, of course, turned out to be the wrong way, because she wasn’t at the lift when we got to the bottom. Still, I wasn’t panicking. The three of us got on the lift with the plan that we would ski the same run again, except this time we’d go the other way and we would find her. We asked the lift operator to radio over to the other lift where we knew she had to be, and ask them to look for a girl with a crazy pink ponytail and to let her know we were on our way.

But as we’re on the lift, my husband’s cell phone rings. It’s a woman who’s found my daughter. Apparently, she was standing in the middle of the run, crying hysterically. Now, I have to say, I was kind of disappointed. Not disappointed that somebody found her, obviously, but that she fell to pieces so quickly. I mean, she knows this place. She knew we wouldn’t just leave her. I understand that she was scared, but really? Crying hysterically in the middle of a run? We asked the woman to tell her that we were on her way and that we’d meet her at the lift, and I skied ahead, terrifyingly faster than normal.

Once she stopped crying, do you know what the first thing she said to me was? "This is why I need to have a cell phone." I was like, oh, no you didn’t. Actually, I told her, this is exactly why you can’t have a cell phone. She was all, what? huh? But I explained that a cell phone is for someone who knows how to handle situations even when they don’t have a cell phone. Instead of crying, I told her, you could have found a ski patrol person or anyone who works here, and you could have calmly told them that you got separated from your parents and weren’t sure where to go. And they would have found us.

But, she argued, if I had a cell phone, I wouldn’t need to do that. I could have just called you. True, I admitted. But what if your cell phone was dead? What if you didn’t get reception? What if you dropped it in the snow and it got wet and didn’t work? You have to know what to do without it, just like you need to know how to look something up in the dictionary in case spellcheck isn’t available.

When I know you’re mature enough to do that, then we can talk about getting you a cell phone. And when is that going to be? she wanted to know. I don’t know, I told her. Why don’t you try getting lost again and we’ll see what happens.

My Tween's First "I Hate You"

By Risa Green 

There are certain moments in life that, while they’re happening, you just know will be moments you’ll remember forever. There are the obvious ones - saying I do, holding your child for the first time, finding out that someone close to you has passed away.

But there are also moments that are less dramatic, less once-in-a-lifetime, and yet, somehow, you still know that they’re going to be seared into your memory for the rest of your life. Like, say, the first time your daughter tells you that she hates you, for example. But let me rewind, because it’s a better story if I tell it from the beginning.

My kids had been fighting since day one of winter break, and like the lame-ass parent I am but pretend not to be, I’d been threatening Extremely. Major. Consequences. I told them if they fought again I would leave them home and go on our vacation to Utah without them. I told them if they fought again I would take away tv for a week. I told them if they fought again I would banish video games from our household. I think they actually might have believed the Utah one, but needless to say, they were on the plane.

The fighting continued in Park City. This one was mean, that one ate my popcorn, he yelled at me, she won’t let me watch the show I want, and on and on and frigging on. The only time they didn’t fight was when they were ignoring each other because they were playing on their Nintendos. So, being the genius I am, I threatened that the next person who did something wrong would lose their Nintendo. And, I might add, that threat occurred the night before we were leaving. Of course, not ten minutes after I said it, my son did something that antagonized my daughter, and she kicked him in the butt. Right in front of me, in the elevator, on our way to a bowling alley. So I did it. I told her the DS was gone, for twenty-four hours.

I don’t know what the unit of time shorter than a nanosecond is called, but it took her about that long to figure out that our flight the next day was in less than twenty-four hours, and that she would, therefore, be videogame-less on the plane. At which point she turned into a highly skilled negotiator, on par with Manhattan divorce attorneys and the guys who sell fake handbags on the beach in Mexico. But I stayed strong. I didn’t succumb to her suggestions of taking it away the day after tomorrow, or taking away TV instead, or that punishments are unenforceable once you’re in federal airspace. She said it wasn’t fair, she said I was mean, she pouted at me. I felt bad, but I held my ground. I told her that next time, maybe she’d think twice before kicking her brother, no matter how light of a kick it might have been. My friend, who we were with, patted me on the shoulder. It’s hard to be a good parent, she said.

At the bowling alley - where she was still pouting and giving me dirty looks - I took her aside and told her that she could be punished and ruin her last night of vacation by being angry, or she could just accept the punishment and try to have fun. And that’s when it happened. My very first I hate you of parenthood.

Of course, I know she doesn’t hate me. I could see by the look on her face that she was shocked the words had even come out of her mouth, and she apologized immediately amid remorseful sobs. But still, it felt like a million bees had gotten inside me and were stinging my bones. And before I could think of anything else, I thought, I will never, ever, forget this. This will be with me until the day that I die. And then, as we hugged and made up, I suddenly felt relieved. I always knew that moment would come, and I was glad to have it over with. The next fifty or one hundred times it happens, I thought, I probably won’t remember at all. 

Holy Hormones - Handling My Tween's Pre-Puberty Crying Jags

By Risa Green 

Somewhere during the first week of school, I noticed that my daughter was not acting like herself. “Herself” is usually (not always, but usually) a bubbly, happy, confident, energetic kid who generally tends to let things roll off her back.

But during that first week of school, she seemed more sensitive than normal; she was getting upset at little things and she was crying a lot. I mentioned it to a few of my friends, but nearly everyone had the same response: it’s the first week of school, it’s a lot of change, they’re all tired, she probably misses camp, it’s an adjustment period.

Okay, I thought. I can live with that. Even though she’s never tired. Even though it’s never taken her more than five minutes to adjust to anything. Even though camp ended nearly three weeks ago. I tried not to over-analyze, though. My plan was to just see what happens.

What happened was not much. The second and third weeks of school were more or less the same as the first. It wasn’t anything alarming, mind you - I wasn’t worried that she was on drugs or anything like that - it was just subtle changes in her behavior. Where last year, a joke about her hair being messy in the morning would have gotten a laugh, now it got watery eyes and a shuffle off to her room to fix it. Where last year an accusation of meanness by her brother would have solicited an eye-roll, now it caused tears and a slammed door.

I tried talking to her. Is anything going on at school? Are you having problems with your friends? Do you feel like you’ve got too much on your plate? Is fourth grade homework too overwhelming? Through tears, she insisted that everything was fine. Then what’s wrong? I finally asked her. How come you’ve been crying so much lately? Her answer: I don’t know why I’m crying.

Well.

If there were ever six words in the English language that resonated more with me, I don’t know what they could possibly be. Okay, maybe "I need a drink right now." Or, "I must buy some new shoes." Then again, "I’m not answering to ‘mommy’ anymore" could be another. But anyway, the point is, with "I don’t know why I’m crying," the kid was definitely speaking my language. I mean, I don’t know about you, but I utter those very words at least once a month, and usually around the same time each month, if you catch my drift.

It was one of those classic, smack-yourself-on-the-side-of-the-head, I Should Have Had a V-8 Commercial moments. She wasn’t tired, or adjusting, or missing camp. She was hormonal. Oy.

Now, the kid is only nine. I know some girls do start that early, but given that she has no other signs of puberty, I don’t believe we’re in menstruation territory quite yet. What I was thinking is that there had to be some kind of early, pre-period hormone phase, and sure enough, when I sat down to Google “hormones in nine year old girls,” I found an article about pre-puberty, which “typically begins in girls between 8 and 9 years old, or three to four years prior to their first period.” Well, hello.

And guess what? Under the section titled “hyper hormones,” it explained that, in pre-puberty, the hormones “are active, but not yet in synch. The discombobulated hormones are like ping-pong balls firing away…sensitive feelings, crying, attitude problems and moodiness can all come into play.” Uh, bingo.

Around like, fifteen minutes later, my daughter had another one of her inexplicable crying jags, this time with my husband.

I heard them yelling at each other in her room. "What’s the matter with you?" he asked her, dumbfounded. "I don’t know!" she shouted. "I don’t know why I’m acting like this! I can’t help it, and I don’t like it!"

I thought of the many, many times I’d said virtually the same thing to my husband, and I knew he wasn’t going to understand it with her any better than he understood it with me. I went into her bedroom and found her standing there, sobbing, while my husband looked on, completely freaked out. I got down on my knees so we could be face to face, and I took her hands in mine. I explained the situation. I told her about the ping pong balls. I let her know that it’s normal, and that if she thinks this is bad, she should just wait until she gets pregnant for the first time.

I was worried that the information might scare her, but if anything, she seemed relieved to know that there was a reason for the way she felt. She hugged me, and I hugged her back, hard. "I get it," I whispered into her ear.

I totally get it. And, I thought, God help us all in a few years, when she gets it, too.

Do You Follow the "Mom Code?"

By Risa Green 

I think we’ve all seen enough bromance movies by now to know that men follow a “Guy Code.” As in, they don’t talk about what happens at bachelor parties, they don’t date their best friend’s exes, and they don’t eat each others’ fries.

But whether you know it or not, there’s also a “Mom Code” that we all need to live by. The rules are pretty simple, and you’re probably already following them out of courtesy, but just in case, here they are:

• You don’t poach another mom’s nanny.
• You don’t flirt with another mom’s husband.
• If you are driving your child and someone else’s child and you only have one booster seat, you give it to the other kid.
• And finally, you don’t give living things to other people’s children as birthday party favors.

This last one was added to the Mom Code just this past weekend, after my son attended a birthday party and came home with a goldfish in a plastic bag. The party was on a Friday evening (hey, there’s another one; don’t have birthday parties on Friday nights that require pickup at 7:30 pm), and since my husband and I had dinner plans, my son got a ride home from the party with another mom. (That’s one more: if a party is at an inconvenient time and you are willing to be inconvenienced, offer to drive home as many other kids as will fit in your car). Not five minutes after he was dropped off, my phone rang. It was my daughter.

(Daughter) - Okay, you’re going to be really, really mad, but the party favor was a goldfish.

(Me) - Why would I be mad that they gave him Goldfish? I mean, they do have a lot of sodium, but is that really worth calling me during dinner?

(Daughter, rolling her eyes through the phone) - Not Goldfish, mom. A goldfish. That swims. It’s in a plastic bag.

(Me) - @$&#! Sorry, honey, pretend you didn’t hear that. Seriously? They gave him a goldfish?

(Daughter) - I knew you’d be mad. Anyway, it’s in a plastic bag and we don’t know what to do with it.

(Me) - Umm, flush it down the toilet?

(Daughter) - Are you serious?

(Me) - Would that upset you?

(Daughter, calling to son) - Would you be upset if we flushed it down the toilet? (Son sobbing in the background) Yeah, I think he’d be upset.

(Me) - @$&#! I mean, shoot.

So, now we have a goldfish. Named Swimmy. Because, you know, with two kids and a husband and a dog, I don’t have enough things to feed and take care of. The last time we had a goldfish, my daughter got it from her preschool teacher as a graduation present. She named it Seashell. I thought Seashell would last five minutes, but she lived for over three years. That’s three years of feeding her, changing her dirty goldfish water, and driving her - in her bowl, between my legs, water sloshing all over my lap - to a friend’s house every time we went out of town. And now I get to do it all again, all because a fellow mom didn’t think to follow the mom code.

And so, if you ever find yourself even thinking about breaking the mom code, I’ll leave you with three little words: So. Not. Cool.

Why It Sucks To Be The Second Child

By Risa Green 

It sucks to be a second child.

Being a first child myself, I always kind of knew this, but it wasn’t until recently that I’ve really come to understand just how hard it is. When I was a kid, I used to torture my poor little brother. My favorite line to use on him was that I was bigger, faster, smarter and stronger, and it made no difference to me whatsoever that I was only conferred those advantages because I’d been born three and a half years before him. I didn’t care that one day he would most certainly be bigger, faster, stronger, and maybe even smarter than me. At the time, he wasn’t, and I let him know it whenever I got the chance.

It wasn’t until I took Psych 101 in college that I even thought about the damage I might have done to his self-esteem. But now that I’m the parent of a big sister/little brother, I’m really starting to see how awful it must have been.

Let me just say here that generally speaking, my daughter is not that mean to my son. He annoys her, and she yells at him and locks him out of her room sometimes, but she doesn’t overtly put him down, and for that I’m eternally grateful. And yet, lately, my poor little boy has just been devastated by her.

The fact is, she doesn’t have to put him down or point out to him that she’s bigger or faster or stronger or smarter, because he already knows it all by himself. He’s not a dumb kid - he can see that she’s bigger. He knows that when they race each other, she always wins. He knows that she can swim farther, that she can ice skate better, that she can read longer books, that she can draw prettier pictures, and that she can figure out more complicated math problems. And no matter how many times I tell him that she couldn’t do all of those things when she was six, it doesn’t change the fact that she can do them now, and he can’t.

The other night, my son tried to show us something he learned in science camp this summer; it was that trick where you put water in a cup and spin it around and the water doesn’t fall out. Except he held the cup the wrong way, and the water spilled everywhere. So my daughter jumped in and said, no, no, no, this is how you do it, and got it right on the first try, causing my son to instantly melt down to a puddle. I took him aside to talk to him, and he was just sobbing about how she can do everything and he can’t do anything, and he feels like he’s the dumb one in the family because there’s nothing that he’s the best at. So I started pointing out all of the things he’s good at, like building Legos and playing soccer and making up crazy stories and using his imagination. But he shot me down every time. Everyone builds Legos. Everyone on my team is better than me at soccer. Everyone uses their imagination. Like I said, he’s not a dumb kid.

At that moment, I realized this was just one of those things that I can’t make right for him, no matter how much I want to. I can keep exposing him to new things, but if he wants to be the best at something - or at least better than his big sister - then he’s going to have to figure out for himself what it is he loves, and he’s going to have to put in the work to get really good at it. For my brother, it was art. He’s an incredibly talented artist, while I can barely make stick figures, and I think it always made him feel good to have that over me. I may have been bigger and faster and stronger and smarter, but he was the gifted artist, and we both knew it.

I would love for my son to have something like that. I would love for him to be confident that he’s great at something. But no matter how much it breaks my heart, I can’t hand it to him on a silver platter. I can love him, and support him and give him all of the encouragement I possibly can, but in the end, he’s the one who’s going to have to get out from under his sister’s long shadow, all by himself.

INSIDE MALAYSIA: Ringgit Falls; Inflation Seen Fastest in 8 Mos

By Yanping Li

March 20 (Bloomberg) -- Ringgit declines 0.2% to 3.1302 per dollar before data due out at 5pm today which economists surveyed by Bloomberg say will show consumer prices rose 1.5% Y/y in February, fastest pace since June.

* Nomura expects Malaysia’s inflation to quicken, driven more by strong demand rather than cost side; Barclays says inflation looks set to remain range-bound amid low food inflation and falling fuel prices

* Malaysian Prime Minister Najib Razak said nation may reach high-income status two years ahead of target, as he seeks to convince voters of his economic achievements before elections due within weeks

* Malaysia to release central bank’s annual report today

* 1-mo. implied volatility jumps 8 bps to 7.3500%

* 12-month forwards little changed at 3.1891 per dollar

* Yield on 3.172% bonds due July 2016 rose 1 bp to 3.069% yesterday; yield on 3.48% notes due March 2023 little changed at 3.482% yesterday

* Bank Negara to sell 1.5b ringgit 364-days note, 1b ringgit 63-days Islamic note and 1b ringgit 126-days Islamic note today

Malaysia Palm Oil ITS Data 1-20 March 2013

ITS (1-20 Mar) = 927665 v 835612 (up 11.02%)

Market Update - 19 March 2013

• Spotlight still on Cyprus, the government delayed voting on the EU deal again and announced banks would remain closed until at least Thursday while discussions continue behind the scenes over how best to administer the draconian Troika medicine to the Cypriot people.

• The latest update is that the tax levied on smaller deposit holders (i.e. less than 100k) will be reduced and that levied on the larger holders (i.e. more than 100k) will be increased to soften the blow on the protesting masses. The Troika has left the composition of the tax up to the Cypriot government but they have just reiterated €8 must be raised, so they will have to come to a compromise before passing it through parliament, presumably tomorrow.

• USDMYR came off a little, opening at 3.1220 as overnight markets turned a little risk off and MYR NDF traded lower. No change from my end still for USDMYR expectations, range of 3.1100-3.1350 with 3.1000 being the strong support and bias towards the upside with resistance coming in at 3.1500.

• USDJPY having dipped down towards 94.50, it gapped up to 95.50 but USDJPY options riskies seems to favour more downside which I agree as I reckon market could push USDJPY lower towards the 93.80 support again before resuming this upside trade.

• Until the deal passes parliament you can expect markets to remain on edge but it seems a straightforward path to me. Longer term this may well have implications for other peripheral states if more bailouts are necessary, as is expected in Portugal and Greece (and quite possible in Spain and Italy), but in the short run I think markets are more than capable of getting over this scare.

• In the US the NAHB housing market index fell for a second month to 44 from 46, current conditions have softened but expectations remain distinctly positive.

• The DOW is down 0.43% after trading briefly in the black and the S&P is lower by 0.55%. Commodities stabilized with oil pared losses of as much as 2%, now down only 0.5% while copper fell 0.62% and gold held onto gains made in the Asian session at $1604.70 last.

Market Update -18 March 2013

• Wall Street closed lower on Friday with DOW -0.17%, S&P -0.16% and Nasdaq -0.30% as investors reacted to lower-than-expected US Empire Manufacturing and U. of Michigan Confidence Index. US headline and core inflation rose 2.0% yoy.

• Eurozone’s annual inflation fell to 1.8% in Feb due to moderate growth in wages and food prices

• The euro dropped to its lowest level this year, stocks fell and the yen strengthened as an unprecedented levy on bank deposits in Cyprus threatens to plunge Europe back into crisis. Gold jumped.

• Japan’s parliament has named Kuroda as the next BOJ Chief while Iwata and Nakaso have also been named as Kuroda’s deputies.

• Chinese Premiere, Li Keqiang pledged to open the Chinese economy to more market forces and strip power from the government to achieve 7.5% annual growth through 2020 and spread the benefits of the nation’s expansion

• Government bonds in Asia climbed as threats that the euro crisis may be reignited boosting demand for haven assets.

• KLCI ended Friday on a rather sour note, as it closed at 1627.64 amidst a string of profit taking actions in the market. With concerns resurfacing in the Eurozone, caution of further downside move if there is a convincing break of the 1625 mark.

• USD/MYR continues its uphill climb on the back on the Cyprus issue and looming Malaysian GE, today’s range between 3.1250 – 3.1400, short-term range 3.1150 - 3.1500

Malaysia Palm Oil SGS Data 1-15 March 2013

SGS (1-15 Mar) = 678829 v 649045(up4​.59%)

Malaysia Palm Oil ITS Data 1-15 March 2013

ITS (1-15 Mar) = 675210 v 673555 (up 0.25%)

Market Update - 14 March 2013

• Italy tapped the mkts for the 1^st time since Fitch downgraded them. Markets were wary with yields. Luck of the Irish the Italians must be thinking...well its not luck I guess. They issued 5bln of new 10yrs at 4.15%. A massively positive result given expectations were to sell 4bln at 4.5%.

• A tale of two continents again, Europe not looking great while US continue to perform. Eurozone Industrial Production was disappointing -0.4% vs -0.1% expectation. This weighed on EU equities which closed in the red.

• The US meanwhile bounced on the Retail data, US Retail Sales produced a great result...+1.1% vs +0.5% exp. Even core sales which stripped out the large increase in petrol prices/sales trended higher. Eurostoxx -0.26%, MIB -1.74%, DAX +0.06%, S&P +0.13%.

• USDMYR still stuck at the range and supported at 3.1000. Today’s range im expecting 3.1000-3.1200 with low volumes given the lack of any meaningful data and we are inching closer to elections. I reckon market have more or less priced it in both in equities as well as the fx and fixed income space. Now its all sit and wait for the election results.

• *Down south in the land of kiwis, RBNZ OCR remains unchanged at 2.5% RBNZ'S WHEELER EXPECTS TO KEEP CASH RATE UNCHANGED IN 2013

• It’s of course key to keep in touch with EURUSD and USDJPY developments as they drive the markets nowadays. USDJPY pulled back below 96.00 with market still looking to buy on dips but I reckon they are more keen to buy at 94.80 – 93.80 levels. EURUSD also hovering around 1.3000 with no firm break lower, market is more cautious on this pair and watching Euro headlines to trade in the short term.

Market Update - 12 March 2013

• Again Europe struggling overnight while the US markets continues to perform well. This trend seems to be growing and the datas are substantiating this monthly. Markets have expressed their view in the EURUSD pair but the break of 1.3000 support was short lived.

• GDP data in Italy showed the country suffered its 6^th straight quarter of economic contraction, GDP falling 0.9% QoQ and declining at an annualized pace of 2.8%. Coupled Fitch downgrade on Friday and that cast a dark shadow over the region, the Eurostoxx fell 0.37% while Italian yield rose 4bps.

• USDMYR now trading around a new handle of 3.1000 with today’s range expected to be at 3.0000-3.2000, bias at the moment still upside but a question I am asking myself now is if the correction I am expecting comes, what is the currency markets will run to? Because now it seems risk on, USD strengthens, risk off, USD weakens temporarily….

• Looking at the bigger picture or economic problems faced by Europe, German data was positive, showing imports growing 3.3% MoM and exports growing 1.4%, both higher than forecasts; meanwhile French and the aforementioned Italian data was, well, awful Industrial Production fell 1.2% MoM for an annualized pace of -3.5%, manufacturing production is falling at a rate of 4.5%/year.

• In US the DOW pushed further into new highs territory and is 0.35% higher while the S&P is making fresh daily highs as I write, up 0.32%. Treasuries edged lower with yields rising 1.3bps to 2.056% while commodities struggled on the back of weaker numbers from China and Saudi Arabia announcing they would increase production, Brent crude fell 0.7% to $110.08, copper fell 0.32% while gold edged up 0.17%.

Malaysia Palm Oil SGS Data 1-10 March 2013

SGS (1-10 Mar) = 438549 v 429070(up2​.2%)

Malaysia Palm Oil ITS Data 1-10 March 2013

ITS (1-10 Mar) = 441025 v 440830 (up 0.04%)

Market Update - 11 March 2013

• Non-Farm Payrolls in the US on Friday was way higher than market’s expectation of 147k, coming in at 236k jobs added in February, beating the survey.

• US unemployment rate also fell to the lowest since December 2008 at 7.7% from 7.9% as more people left the labour force. This is probably one of the most important data that the Fed keeps an eye on and if the number continues to fall we could see Bernanke starting to show more willingness to reduce and ease QE.

• USDMYR also opened higher on the back of more US Dollar strength and my view remain unchanged of the pair being upside biased still on the short term with the initial target at 3.1500 and a firm break will take us higher to 3.1700. But if there is a game cahnger then 3.0500 for now looks to be a decent support for the pair. Range for today 3.1000-3.1200.

• We saw the largest gain in construction payrolls since March 2007; manufacturing and goods producing payrolls also rose at the fastest pace in some months. Government payrolls fell 10k, continuing a trend that will accelerate as the sequester cuts hurt the public sector.

• Treasury notes broke out of their recent range, the 10 year yields hitting the highest level since April last year at 2.085% before slipping to close 4.6bps higher at 2.043% (a new April high on a closing basis).

• Stocks were up across the board, the Eurostoxx rising 1.41%, the DOW into new record territory and up 0.47% and the S&P just 25pts shy of its own record, up 0.45% to 1551.2.

• The world’s largest Bond fund manager PIMCO raised their growth forecast for the US in 2013 to 3%, as data in US continues to show promising recovery signs.

• The Euro did well to shrug off a Fitch downgrade of Italy to BBB+ late in the day, but it came after European bond markets had closed, with Spanish yields managing to crack a Nov 2010 low at 4.83%. The markets are clearly underestimating

• China data out on Saturday was cause for concern, with retail sales growing at the slowest pace since 2005 (according to Bloomberg data), CPI rising more than expected to 3.2% from 2% last month and industrial production decelerating to 9.9% YoY, lower than the forecast 10.6%.

Market Update - 8 March 2013

• Fears in Europe were eased by Mario Draghi overnight. He expects that Italian reforms would continue. He also said that a rate cut was discussed at the meeting and EURUSD flew up 140pips to 1.3130 after Draghi also left out the rising currency as an impediment to growth.

• On contrary with the risk on mode last night, US Equities was up and so was the US Dollar.

• Just to clarify, for those who have been reading the commentary and the usual risk off and Dollar is higher has changed in recent weeks as US economy recovers, market expects money to flow into US and resulting in more USD Strength. On top of that the USDJPY strength has also increased the USD strength as market feels more confident in betting on the pair given the risk on sentiment.

• USDJPY blew past the 94.20 resistance and hit an overnight high of 95.00. It is still hovering around that handle and market is awaiting tonight’s US NFP numbers. A good one would see the pair trade higher while a weak number would is it trade lower back to the 93.00 support.

• USDMYR is still hovering around 3.1050 and I don’t expect much movement today ahead of the US NFP tonight and also the weekend. Expect tight range trade of 3.0900 – 3.1100 with my opinion of still a biased on the upside.

• Equities were up across Europe, the Eurostoxx 50 up 0.4% while peripheral spreads narrowed after Portugal (-22bps) was upgraded to stable by S&P from negative, Spain successfully auctioned bonds (-11bps), and Draghi was upbeat on Italy (-6bps).

• The USA continued its recent run of better data, jobless claims falling to 340k and consumer credit expanding the most in 5 months.

• The DOW wandered furthered into the unknown, rising 0.2%, while the S&P rose 0.2%. Treasury yields rose 5.4bps to 1.99%.

Market Update - 7 March 2013

• It was all a US Dollar story last night after ADP Research Institute said companies added more jobs than forecast last month, spurring bets U.S. nonfarm labor data will show stronger hiring. Dollar strength finally caught up with the US equity markets that continued to rally, risk appetite is definitely on last night and expecting it to continue here in Asia today.

• USDMYR finally traded higher above the 3.1000 handle, opening at 3.1150. EURUSD and USDJPY is leading the way in USD strength with EURUSD breaking 1.3000 while USDJPY rocketing to 94.20. I am still biased on more upside for USDMYR in the short-medium term, as for this week, Draghi will be speaking tonight so it will either fuel further USD strength or reverse the trend and get back to previous technical support levels.
  
• U.S. Treasuries fell for a third day as the Federal Reserve’s Beige Book business survey said the economy expanded at a modest to moderate pace across most of the country.

• As we mentioned previously, the market is trying to sell the Treasuries but with Fed Chairman Ben S. Bernanke and Vice Chairman Janet Yellen both said over the past two weeks the central bank should maintain stimulus efforts, market is finding it hard to justify getting out of treasuries. The central bank bought $1.46 billion of Treasuries today in a program to support the economy; until the Fed decides to ease its stance on further easing we should see US Treasuries supported for now.

• The Dow Jones industrial average DJI rose 42.47 points, or 0.30 percent, to 14,296.24, another record closing high. The Standard & Poor's 500 Index .SPX edged up 1.67 points, or 0.11 percent, to 1,541.46.

Dollar Remains Lower Versus Majors Before U.S. Jobs Data, ECB

By Candice Zachariahs and Mariko Ishikawa

March 6 (Bloomberg) -- The dollar remained lower after declining yesterday against most of its 16 major peers before a private jobs report in the U.S. forecast to show companies added positions in February.

Demand for the U.S. currency was limited before the Federal Reserve releases its Beige Book report. The euro was little changed against the yen for a third day before European Central Bank President Mario Draghi and his board meet tomorrow.

Speculation that central banks will continue stimulus helped spur the Dow Jones Industrial Average to a record in New York.Australia’s dollar was higher after gains yesterday ahead of a report forecast to show economic growth accelerated.

“The dollar is being sold in a risk-on trade,” said Kazuo Shirai, a trader at Union Bank NA in Los Angeles. “The Dow Average climbed to a record and Treasuries were sold. The market is waiting for the jobs report.”

The dollar traded at $1.3046 per euro as of 8:11 a.m. in Tokyo after falling 0.2 percent to $1.3052 in New York. It fetched 93.33 yen from 93.29 yesterday, when it weakened 0.2 percent. The euro was little changed at 121.77 yen.

U.S. companies took on more workers last month after adding the most jobs in almost a year in January, figures from the Roseland, New Jersey-based ADP Research Institute will probably show today.

U.S. Jobs

Firms added 170,000 positions in February, following a 192,000 increase the previous month, economists forecast in a Bloomberg News survey. The Labor Department will release its payrolls data on March 8.

The Swedish krona and New Zealand dollar have led gains this week among 10 developed nation currencies tracked by Bloomberg Correlation Weighted Indexes as optimism about growth in the world’s largest economy spurred demand for higher- yielding assets. The Dow closed at a record 14,253.77 yesterday.

The ECB will probably maintain its benchmark rate at 0.75 percent this week, according to a Bloomberg survey. The central bank will also update its December economic forecasts.

The euro area’s gross domestic product probably fell 0.6 percent in the fourth quarter from the previous three-month period, according to the median estimate of economists surveyed by Bloomberg before the data today.

Demand for Australia’s dollar was supported before the nation’s statistics bureau is predicted to say GDP expanded 0.6 percent in the fourth quarter, accelerating from a 0.5 percent pace in the previous three months.

The so-called Aussie fetched $1.0266 after gaining 0.6 percent to $1.0258 yesterday.

Market Update - 6 March 2013

• Market seems pretty subdued even though Dow hit a record high last night, risk appetite in equity markets seems quite strong still…..for now. Little movement in other asset classes including the G10 currencies.

• EURUSD still supported at 1.3000 and AUDUSD pop back up to 1.0300. USDJPY still above 93.00 a break of 93.70 could see it test 94.70, a break of 92.00 support would see it track back to 90.80.

• USDMYR after a brief dip below 3.1000 earlier again trades above the 3.1000 handle. My view remains unchanged for now for a bias on the upside for USDMYR and its consistent with some G10 traders view of USD strength in the coming weeks.

• Italy’s bonds advanced for the first time in three days after European Union finance ministers opened the way for looser budget policies that may support growth.

• Treasuries declined for a second day as a report showed U.S. services industries expanded at the fastest pace in a year, damping demand for the safety of U.S. government securities.
  

• Benchmark 10-year yields rose as risk appetite climbed after China vowed to maintain its growth target and euro-area manufacturing and services shrank less than forecast. The yields touched a five-week low yesterday. 

RATES PLUS: Citi Shuns Worst-Performing Southeast Asian Currency

By Bloomberg News
March 6 (Bloomberg) -- Investors should use options to simultaneously bet against the Singapore dollar and in favor of the ringgit as the market has overreacted to potential for Malaysian currency to weaken ahead of nation’s election, according to Citigroup.

* Ringgit traded at 3.1071 per U.S. dollar yesterday, having weakened 1.4% this year; currency trimmed losses after government data showed Malaysian economy expanded 6.4% in three months through December, most since 2010

* Singapore dollar has weakened 1.9% in 2013, most among Southeast Asian currencies; factory output shrank 9.2% from month earlier in January, worst performance since December 2010

* “The Singapore dollar has very limited upside given weaker- than-expected growth and inflation data in January, while Malaysia has a strong growth story,” Arup Ghosh, a Singapore-based hedge funds strategist at Citicorp Investment Bank, says in interview. “The recent selloff in the ringgit was only because of fears of a disorderly outcome in the elections. If the current government does stay in power, the underperformance of ringgit could quickly reverse.”

* Investors should buy three-month puts on SGD/MYR cross at 2.50 and sell three-month puts at 2.45; payout ratio vs premium of 0.7% is 3:1

* “This is a positive carry trade, so even if nothing happens and we stay where we are, the trade should perform,” Ghosh says

Market Update - 5 March 2013

• USDMYR opened a touch lower at 3.1030 despite all the bad news earlier, this could be due to a late rally in US markets before the close. For those who are following the equity markets, a correction seems to be in the brewing. Market usually tend to be a little iffy once we reach the first corner of every year, April-June, like the old saying sell in May and go away….this further reinforce my view of USDMYR range trade in short term with bias on the upside.

• Over in the European session, things stared on the back foot after waking to negative headlines from Asia, the Shanghai Composite falling 3.65%, the biggest one day fall since November 2010 after the government proposed measures to curb property prices and the PMI figures hit 5 month lows.

• This story picked up by trade may help explain the rally since 4am in the Euro and US stocks:

• (EU) ECB officials said to refute press speculation that indicated the ECB has considered exiting the Troika due to concerns about central bank independence - financial press:

• An earlier German press story suggested that the ECB was considering separating itself from the Troika structure with the IMF and EU because of worries about political influence in both directions; ECB members are said to be concerned that the Troika may exhibit undue influence on central bank policy, and in turn that the ECB may have increased influence on European politics. The German press report, citing unnamed sources at ECB, said the topic has been coming up every few weeks at the ECB. - Source TradeTheNews.com

• US stocks are rallying again despite warning signs from elsewhere in the world and valuations which I think are definitely on the high side, and earnings projections that may well prove optimistic. Anyway, here we are, the S&P is higher by 0.3% and into my sell zone in the 1520’s:

• Treasuries had a good start with yields hitting 1.825% before selling off all afternoon and closing 3bps higher in yield at 1.87%.

• More bad news for the Brits with the construction PMI falling to 46.8 from 48.7, the lowest since 2009. GBPUSD tested 1.50 before rebounding strongly 

Market Update - 4 March 2013

• On Friday night Barack Obama signed into law the sequestration cuts that will save the US government (cost the economy?) $85bln this year. GDP would have grown by about 2.5% in 2013 but the cuts will shave about 0.5% off growth, it’s not a disaster but the longer the deadlock continues, the larger the risk of a confidence shock. The next budget extension deadline is on the 28^th March.

• So perhaps it’s little surprise the markets shrugged it off, choosing to focus more on the strong domestic data. Personal incomes fell more than expected but that mostly reflected the adjustment following extra payouts ahead of the higher payroll tax.

• USDJPY was an interesting pair on Friday night, the buyers came in and bid the pair up back above 93.00 in a flurry and its currently hovering around 93.50 with resistance coming in at 94.00 and 94.77, a break would see it test 95.00.

• USDMYR also opened higher this morning on the back of strong USD, the pair prop back up above 3.1000 this morning, currently trading at 3.1100. My personally view remains unchanged, range trade for now with bias on the upside.

• The Markit PMI was slightly softer at 54.3 from 55.2 but UoM consumer confidence rose to a 3 month high and the ISM manufacturing PMI hit a 2 year high at 54.2 from 53.1.

• The S&P closed up 0.23% while US treasury yields fell 3.5bps to 1.84%. Industrial commodities were softer, oil off 1.5% and copper down 1.4%, gold held its ground at $1577

• From the FT, Warren Buffet said in his annual letter to share holders “Charlie [Munger, vice chairman] and I have again donned our safari outfits and resumed our search for elephants”. “Our elephant gun has been reloaded, and my trigger finger is itchy.” – they are ready to go buy stuff again after having just acquired Heinz.

• In Europe retail sales grew at the fastest pace in 5 years in Germany after a poor December, but unfortunately data from the rest of the continent reminded us the place is still a basket case:

• Manufacturing PMI’s in Italy and the UK deteriorated significantly, remained poor in France and grew marginally in Germany.

• Unemployment across the region hit a record high at 11.9%, the headline figures are a horror story in themselves but the youth figures are rising even more quickly.

• Italy’s politicians look unlikely to last long before another election is required, with no certainty the good guys will win.

• Stocks fell across the region, the Eurostoxx 50 down 0.64% with the FTSE the only index up, +0.28%. Despite the poor data in Britain, a lower sterling and more printing from the BOE expected this week helping things along there. The ECB will also announce rates on Thursday before the payrolls numbers in the US on Friday.

• China yesterday released its non-manufacturing PMI figure, and, like it’s manufacturing counterpart on Friday, it plunged to a 5 month low. The government has said it will not allow property prices to rise any further but it won’t be tightening monetary policy any further in the wake of recent softening in data.