Daily Report 131114 2014-11-13
Macro Economy

Chinese President Xi Jinping and Premier Li Keqiang talked to U.S. President Obama respectively yesterday. Both parties hope to come up with a balanced bilateral investment agreement to further promote the increase of bilateral trade. Meanwhile, both countries want to cooperate with each other in areas such as export of hi-tech products, exit-entry administration, energy cooperation and changing of climate etc. Cooperation with the U.S., which is one of the biggest target exporting countries, will bring positive influence to foreign trade and exportation, and stabilize domestic economy as well. Besides, the industrial added value, fixed assets investment and total retail amount of social consumptions etc. in October will be released by National Bureau of Statistics on 1:30 p.m. today. Attention should be paid on those data.


Overnight domestic gold main contract 1506 rushed up high then fell back; in short term it is above RMB 229.7 on 10-day moving average. After the recent slump, the price edged up to fix previous dropping. Investors who hold short positions at high price should make defense by 5-day moving average; the short term we suggest not taking any further steps beside wait and see; intraday pay attention to the performance at RMB 230.
This week the U.S. market is relatively flat. The dollar index and U.S. stock adjust at high price, which gives gold price a chance to rally slightly. However, from the financing perspective appears that funds are not bullish on gold price. Gold ETF was lightening up 4.48 tons in three consecutive days to 722.67 tons.


Overnight domestic silver main contact 1506 has a narrow adjustment; in the short term the price will be test if it could break 10-day moving average resistance. In terms of operation, silver futures price rally slightly recently. Investors should make defense at RMB 3300 for previous short positions which bought in at high price. In the short term we suggest not taking any further steps beside wait and see; intraday pay attention to the performance at RMB 3340.
In general, silver price followed with the gold price trend; it may hardly get rid of the independent situation. From the fund perspective, silver ETF remains unchanged for four continuous days.

Stock Index

Stock index fluctuated in the early market and then increased in the afternoon yesterday. Promoted by the expectation of Shanghai – Hong Kong Stock Connect, funds are substantially flowing to blue-chip stocks. However, changing of style leads to risk to small cap growth stocks. The stock market corrects for a while. Considering the trend in the early market, the pressure of selling stocks is not heavy. The cautious sentiment among the market is erased in the afternoon. The stock index is then back to a upward trend. Supported by the Shanghai – Hong Kong Stock Connect and easing monetary policy, blue-chip stocks is likely to continue soaring, which will further drags up the stock index.


In domestic market, positions of soybean in Dalian Commodity Exchange shrank in near months with the price closing lower. The downward trend of domestic soybean spot remains. Purchasing prices of part of regions continue dropping. Currently, purchasing prices of most regions are lower than RMB 4400 / ton. Soybean meal spot prices in most area are upwardly revised by RMB 40 to RMB 80 / ton. The supply of soybean meal spot is relatively small while the basis spread in far months drop. The U.S. soybean will arrive at harbor at the end of this month, which will bring pressure to the market. In terms of operations, considering the soybean rallies in foreign market, short-term moves could be taken for soybean meal in Dalian Commodity Exchange. As for the No.1 soybean, contracts in near months are believed to be strong while contracts in far months are weak.
                                                                              Dong LV (Investment Certificate NO. TZ008452)