Daily Report 221214 2014-12-22
Stock Index

The stock index closed up on Friday. The “One Belt One Road” theme led infrastructure and iron became the new main force of the index. While on the other hand, intensive funding issues between banks and influences from new shares subscriptions forced funds in the whole market lost balance. Moreover, stocks that have strong former performances slumped. As estimated, the impacts from new stocks subscriptions would fade, while funding in the banking area might keep the intensive situation. If the intensiveness of funds remain, it is possible that the central bank would take further easing policies. Beware of funding risks if the central bank does not take any further measures. In operations, be alert of drops after short increases in the short run.


PP

PP futures contract low shocked last week. On the upstream, propylene prices increased $5 last Friday, FOB Korean propylene averaged at $535.5 per ton. On the device aspect, current operating rate does not show apparent changes, and there are no signs of overhaul and production restriction. On the spot market, the core of turbulence for the futures moved up slowly last week, cheered the companies up, associated with a better trading circumstance. Sinopec took the opportunity and restricted its supply, and that led to a slight growth of quoted prices. Take bushed PP as an example, the quoted price of the north China was RMB 8,950-9,300, while for the east China was RMB9, 000-9,500, and the south China quoted at RMB 9,350-9,500. Although the basic shipment turned better in a certain extent, it is a problem that whether the good sign can be remained. The current 5-day moving average turned up, forming an MACD golden crossing, which shows a rebound pattern. It is more likely to remain narrow drifts this week, and the main pressure is from RMB 8,000 line. Once a bullish breakout happened, the next pressure interval is RMB 8,500-8,600.
                                                                                      Dong LV (Investment Certificate NO. TZ008452)