Daily Report 080615 2015-06-10
Macro Economy
On Friday, the U.S. stock market ended up low, S&P index continues dropping for two weeks, the better-than-expected employment data encouraged this year FED interest rate expectations. Data released that in May, the added U.S. non-farm employment amount increased a 5-month high position to 280,000, over medium value from market anticipation; monthly average payment per hour year-on-year growth was 2.3% and ring growth was 0.3%, but unemployment rate slightly increased 0.1%. On the whole, current data still encouraged FED interest rate expectations in Sep; after announcement the U.S. dollar soared, U.S. debt dropped and gold slumped. William Dudley, the president of the Federal Reserve Bank of New York indicated that if employment market continues improving and inflation expectation remain a well being anchor, will support starting normalizing monetary policy in later this year; deflation shall follow the path “shallow range, upward”, pace shall depending on reaction from financial market. We hold opinion that recently continuous strong non-farm data has not bring more sufficient information to rates raising, payment increasing accelerating may or may not boost sales and drawn the inflation is the crucial of FED deflation policy in later stage. In Euro side, Greece continues deadlock, Tsipras - prime minister of Greek criticized creditors’ plan which is “Obviously not realistic” and, Greek lawmakers supposedly will not support the creditors’ plan; Tsipras indicated will hold a meeting to German Chancellor Angela Merkel and French president Hollande, core of divergence in negotiation is still on reducing compound interests and austerity budget, it tend to be difficult to accomplish final agreement for both side in this meeting.
As domestic side, there will be a large amount of data being released, including intraday import and export trade data, Tuesday CPI and PPI inflation data, Thursday industrial added value, consumer and investment growth. In addition, data in monetary finance aspect is going to be issued during 10-15 June, which investors shall pay significant attention.
 
 
Stock Index
Stock Index entered the period of high position with fluctuantaion. First of all, valuation turns up confused; divergence between momentums from punters and industry funds is increasing. Substantial Shareholder unloads shares since the profit rate of stock market extremely increased. Secondly, bull market will not tend to end easily, there’s a strong bargain-hunting momentum from market and, fund enthusiasm will not subside at once. Thirdly, national reforms and policies keeping launch and, concepts in bull market are still in preliminary stage of implementation, if the bull market ends currently then all these concepts will be invalidated, reforming failed, which is obviously impossible. One Belt and One Road, SOE reform, Made in China, intelligence, internet plus, and other concepts will be further launched. Only with in current stage in the high position, psychology of market needs digestion and adjustment.
At present, market will transform from fast bullish into slow bullish or volatile bullish, risk increasing accordingly. We recommend intraday do not chase high return irrationally and buy in long positions at low price.

 
Soybean
Soybean No.1 Contract futures price decreased RMB200/ton after it hits the pressure from warehouse receipt cost area, broke through bolster of RMB4300; since soybean spot price slightly rally recently, soybean futures price will get bolster from it, we recommend previous short holdings may unload under RMB4300.
Soybean meal spots price continues dropping, mainstream quotation is RMB2500-2600/ton, impacted by grease width fluctuant recently, soybean meal short term volatile tends to weak, lacking of orientation and, supply in the future is abundant which will continues hammer the price.
In terms of operation, we suggest investors who hold soybean meal short when the price rallies, previous short holdings are recommended to be held further.
 
 
                                                                           Dong LV (Investment Certificate NO. TZ008452)