Daily Report 220715 2015-07-22
Macro Economy
Yesterday US stock market dropped, fell back from the record high to the 2-weeks largest downward scope; the quarterly results from IBM and United Technologies disappointed the investors, S&P 500 index closed down 9.07 point or 0.43% to 2119.21 point. In US side, US June industrial output correction increased 0.2% compared to last month, initial value was increased 0.3%; manufacturing output correction decreased 0.1% compared to last month and leveled off with initial value, which showed more potential for revolving in manufacturing relative to real estate and consumption. In Euro side, Greek Parliament will vote for the second batch of reform measures. The Greek government spokesman stated after the Parliament voting, Greek would launch the bailout negotiation with creditors and, it was predicted to be finished before 20 August. There is European committee member indicated that the creditors had already approved debt write-down as long as Greek may meet the terms of third round bailout plan. Since the liquidity prospect improves, S&P up-grades the Greece's rating from CCC- to CCC+ and, it is predicted the negative adjustment would be stabilized, the Greek debt risk continues decreasing.
In domestic, Ministry of Commerce presented in yesterday conference that, in this first half year, there was 11,914 pieces foreign-invested enterprise established nationwide, increased 8.6% on year to year base; actual using foreign capital amount was RMB 420.52 billion (about $68.41 billion), increased 8.3% on year to year base. According to our calculation, the hot money in June outflows about RMB 400 billion, still in a high level. PBOC states social financing scale store in June is RMB 131.58 trillion, increased 11.9% on year to year base; of which, the granted outstanding RMB loans to real economy is RMB 88.07 trillion, increased 13.8% on year to year base. Along with progressively improvement from manufacturing and real estate industry, comprehensive recovery appeared in June economic data; we regard China economy is closing the bottom of the periodic, the hammer in later this year will be relieved, concrete policy tendency in later period may be varied, directional policy is gradually becoming the mainstream.


Stock Index
Yesterday stock index volatile, both long and short were in hesitation. But the stock spot is in a bull trend, majority sectors are in red. Sectors as agriculture, forestry animal husbandry, fishery, leisure services, transportation, architectural ornament, light-manufacturing and communication become the big gainers, only bank, national defense and military industry, household appliances edge down. In concept stock, except aircraft carrier, SFTZ index, all the other stocks are in red. As for stock perspective, the confidence is gradually recovering, but the market still appears a certain hesitation. Regarding to further rising, it is hard to boost momentum relying on old logic and the investors are in the injured, hard for unilateral rising. Overall, we recommend maintain the fluctuation or slightly strong mindset.
 
 
Soybean
DCE soybean volatile in night session; soybean No.1 contract maintains in fluctuation platform, merchant has sufficient inventory, market actual trading is thin, South area lacks demand under the impact of import soybean; no relief of difficulty in domestic soybean export sales, hard to say soybean No.1 contract is in optimistic.
Soybean meal spot stabilized in most areas, terminal purchase was in the observing mindset, trading volume was thin, US market dropped and domestic raw material supply sufficient boomed the shorten momentum; current soybean meal spot was strong in North and weak in South, hammer from inventory in North oil plant was seldom, aspiration of insisting price is strong; hammer from inventory in South was huge; meals were in the adjusting after rebounding, market direction was  uncertain in a short period. As for operation, we recommend take short term or observe.
 
 
PP
Yesterday PP futures continued volatile, opened at 8150 and ended at 8142; trading volume decreased 630 lots to 274,000 lots, holding decreased 3192 lots to 264,000 lots. In upstream, FOB Korea propylene decreased $5, average price was $840.5/ton. For spots side, yesterday domestic PP market slightly consolidation, market was in a think observing atmosphere. Most EXW in petrifaction enterprises is stable, individual grades in South China and East China reduce price. Merchant shipped in the market price and bid on the own source of goods. Downstream plants purchase as requirement, trading and investing is common.
Main quoted wires prices of north, east and south markets are RMB 8000-8150/ton, RMB 8150-8350/ton and RMB 8170-8300/ton, respectively.
As for operation, moving average system permutes in short but, MACD green column shortens, current price gets bolster at 8100, the short holdings may further kept in cautious; yesterday crude oil rallies back, if the downturn momentum is weak, may consider of closing position to stop-profit.
 
 
                                                                          Dong LV (Investment Certificate NO. TZ008452)