Daily Report 040116 2016-01-04
Macro Economy
US stock market was slumped in prior trading day, S&P 500 index dropped 19.42 point or 0.94% to 2043.94 point. Throughout this year, 2015 had set the largest down range from four year and, fluctuation had the top from financial crisis but, close point by the end of year was slighter lower than the begin of the year; hammer on US stock market was continuously raising no matter from fundamental side or technical side, need to pay attention on retracement risk. On US side, last week initial jobless claim was 287,000, higher than expected 270,000, but was still lower than 300,000 mark. The US initial jobless claim was lower than 300,000 mark for forty-three straight weeks. Reviving on labor market was continuing, US December non-agriculture and employment data will be released on this Friday and, it will be the focus. Fed vice president Fischer indicated if the financial market was overheating the central bank was necessary to hike interest rate. Cleveland Fed Mester indicated recent data showed the inflation was rising. Fed January meeting will be ended at 27 January and will release the statement at 28 January, the wording from Fed on this meeting will be crucial. In addition, Saudi Arabia's execution of prominent Shiite cleric Nimr al-Nimr had caused uproar and, Iran claimed would take retaliatory measures but, influence on commodity market was limited, variation on crude oil and gold price was small. We will continue focusing the following influence from this event to the situation in the Middle East and, price on crude oil and other commodities.
On domestic side, the State Statistics Bureau released Chinese December industrial PMI slightly increased to 49.7 on Friday, was lower than 50 for the fifth straight month and, was the longest continuously shrinking period since 2009. The non-industrial PMI rose to 54.4, set the sixteen months’ highest point. Specifically, production, new export and new order broad revived, finished product inventory decreased and, raw material inventory increased. Data revealed Chinese economy growth is continuing month-on-month but, the downturn risk cannot be ignored and, Small Business Index is 44.9 means economic vitality in the bottom was insufficient. In addition, China December Caixin industrial PMI will be released at 9:45, intraday morning, and expectation is 48.9 and is lower than the 50 threshold for the tenth straight month; November is 48.6. The data need to be focused.
Last week cooper market was mainly rising in the fluctuation. On macro side, China December official industrial PMI increased 0.1% to 49.7. From sub-index perspective, production index increased 0.3% to 52.2 month-on-month, new order index revived 0.4% to 50.2, was both above the Entrepreneurs confidence threshold which showed a gradually plainly sign on economy stabilizing from the bottom. But the PMI index was still lower than the 50 threshold; the nation’s policy would still be stabilized growth. In addition, December official non-industrial PMI was 54.4, set a record high since August 2014, showed the service industry was accelerated developing along with the economic transition. Euro Zone PMI increased 0.3 point to 53.1 and, US PMI hadn’t released yet, need to focus on. On fundamental side, LME premium slightly increased $1 to $0.75; domestic was discount RMB 170 to discount RMB 110. Last week three major exchange copper inventories decreased 1513 tons, including LME increased 3300 tons; SHFE inventory decreased 4981 tons. Peru November copper output increased 37% to 159,000 tons year-on-year, the increased copper output was mainly benefit from new mine put into production and mine field extension. Technically, copper price volatile upward trend has not shifted yet and, we recommend still take long positions on operation.

The domestic and overseas market will resume trading after the New Year holiday, performance from domestic and overseas market was mainly in stabilizing under the influence from the holidays. DCE soybean was in divided performance before the holidays, pattern on strong oil and weak meal was still plainly. Recent domestic soybean tendency was weak out of stabilization, under the stalemated supply and demand side, spots price was basically operate on the basis of narrowly adjustment out of stabilization. We regarded soybean No.1605 contract direction was uncertain in short term, overall tendency would be weakly fluctuated before Spring Festival, stayed in observing on operation temporally. Domestic soybean meal spots price were stabilized, downstream side replenished before Spring Festival and, low January port arrival amount bolstered the firm spots price, but under the strong grease, it was predicted soybean meal price would continue volatile in a short term. Oil against meal ratio was 2.40:1. As for operation, we recommend focusing on the fluctuation ceiling of grease and, arbitrage between oil and meal pay attention on stop profit at the top edge of interval.
Natural Rubber
Shanghai rubber continued fluctuation before the end of the year, US dollar spots market continued weaken. Up to the last day of last year: domestic spots price was 1080-1100(-20); domestic cargo price 1120-1140(-10); US dollar RSS spots price 1210-1240(-10); US dollar RSS cargo price 1200-1230(-10). On news side: SHFE natural rubber inventory slightly increased 9100 tons to 249,300 tons; registered warehouse receipt increased 8900 tons to 158,900 tons. Qingdao Bonded Zone rubber inventory continued rose to 255,200 tons, increased 4.7% compare to middle of December. The released China December industrial PMI during holidays was 49.7, rose 0.1% month-on-month, including new order index rose above 50 to 50.2%. Non-industrial PMI index was 54.4, increased 0.8% month-on-month. In addition, Caixin PMI will be released on intraday, we will focus on it. Overseas market was mostly closed during New Year holiday; global oil price soared near 3% since Saudi cut ties with Iran but, still hovering around $38. Overall: we remain the standpoint on phased revive, pay attention on protect right side as for operation and, focus on prior concentrated trading area on technical.
                                                                       Dong LV (Investment Certificate NO. TZ008452)