Daily Report 101016

Stock Market
During the National Day, the property market introduced intensive control policies. New homes, second - hand housing transactions fell sharply, former fear of real estate regulation and control finally come to the real. China's real estate thriving, strictly control is bad to fundamentals and blue chips. But the property market flows out of the capital flows to the stock market is unlikely. The property market and the stock market does have the effect of seesaw since 2014, but this time regulation can’t mean this property market will go down for a long time, more likely to be a runaway property temporarily suppressed. Zhou Xiaochuan said during the National Day: "With the gradual normalization of the global economic recovery, China will have some control of credit growth." Further, if the real estate really wants to become a long period of decline, the government may tight the overall monetary policy, which is not conducive to the stock market.
During National Days Festival, overseas section copper price rolled back, bolstered at 10 weeks average line. During national days festival, inventory of LME and COMEX decreased 16881 tons to 426000 tons. LME inventory decrease 16925 tons to 355000 tons, and COMEX inventory increased 44 tons to 71000 tons. LME physical keeps discount and discount enlarged, which was $19.5 during festival, near the lowest point of this year. We focus on resistance at 10 weeks average.
Domestically, after National Day Holidays, since overseas section has slight increase, DCE soybean opens slightly high. But overseas section reports will release, and bear market is expected. So DCE market rally space is limited. During national days festival, domestic soybean actuals tendency is weak. Recent West Heilongjiang soybean price is weak. Purchase price is RMB 3520-3640/ton, because of the low quality and low protein. High quality district of Heihe soybean quality is worse than last year, and purchasing price is around RMB 3700/ton. As for operation, US section report is near of release. DCE market should be cautious. Hold buying oil selling meal arbitrage position.
                                                                                                         Dong LV (Investment Certificate NO. TZ008452)