Daily Report 310715 2015-07-31
Stock Index
Intraday stock index weak in rally and continues falling. Except for national defense and military industry sector, sectors as medicinal & biological, computer, non-bank financial, electron, communication, household appliances and real estate all dropped. China real economy continues weakens and, not like the performance in stock market, bottoms out from reform and transition from the favorable anticipation. In addition, if concepts in previous cannot further processing, investors will not be further attracted on; market is lacking of confidence, mindset of shorten is strong and weaken when rallies. Meeting of the Political Bureau emphasizes proactive fiscal policy, national team will not out of the market, which boosts the margin-hunting confidence, but cannot boost the upward momentum. Currently there is a certain rally demand at the bottom of IF price but, hammer on the high point is huge, possibility of volatile weak is high.

DCE soybean slightly rallies in night session, recent tendency is fluctuant; domestic soybean spots price stabilize, soybean No.1 contact soars in these days under boosting from strong spots but, downstream purchase demand has no plainly improvement by this impact; in addition, bean products are in slack season at present, domestic soybean is in seasonal shortage cycle which will bolster the price in a short period, but shall not over expecting on this rebounding.
Soybean meal spots maintain stabilize in most areas, sales performance of oil plants is common; hammer on north area is light, soybean port arrival amount in August to September from market anticipation was huge, and the inspection at port of soybean trading flow direction, hammer on raw material market was hard to eliminate in a short time; treat the meals tendency in retracement for a short period. We recommend hold slight positions or stay observing as for operation.

Yesterday PP futures opened up high and went lower, opened at 8006 and ended 7915; trading volume decreased 54,394 lots to 206,000 lots, holding decreased 2797 lots to 184,000 lots. In upstream, FOB Korea propylene edged up $2, average price was $847.5/ton. As for spots side, yesterday domestic PP market slightly raise in stabilize. Overseas oil price rallied, boosted PP futures opened up high, in addition with regions of Petro China East China, South China increased EXW, partial merchants quoted high exploratory. In downstream, plants continued purchase as demand in the end of month, trading in firm offer is mostly rigid demand.
Current main quotation of wires, north market was RMB 7900-8000/ton, east market was RMB 8050-8200/ton and south market was RMB 8150-8250/ton.
As for operation, current moving average system still permutes in short, MACD exposure extends down as bearish formation. Hammer at 8000-8100 is plainly, we recommend continues shorten in high.  
                                                                      Dong LV (Investment Certificate NO. TZ008452)