By MarketWatch
BEIJING–Iron ore spot prices for China delivery have surged nearly 30% since early September with mills replenishing stocks amid a tentative rebound in the steel sector, suggesting that a recent price decline may have bottomed out.
…..Prices for 63.5% iron ore fines delivered to Qingdao rose 29% from a multiyear low Sept. 7 to around $117 a metric ton Monday, data from The Steel Index showed……
via China iron-ore spot prices surge 30% in just weeks – MarketWatch.
The Shanghai Composite Index is consolidating between 2000 and 2150. Descending 13-week Twiggs Money Flow warns of long-term selling pressure. Respect of resistance at 2150 is likely and breakout below 2000 would signal a decline to 1800*.
* Target calculation: 2150 – ( 2500 – 2150 ) = 1800
Shenzhen Composite Index is testing primary support at 800. Again, descending 13-week Twiggs Money Flow indicates long-term selling pressure. Resistance at 900 is likely to be respected, while breakout below primary support would offer a target of 600*.
* Target calculation: 800 – (1000 – 800 ) = 600
Japan’s Nikkei 225 is testing support at 8650/8700. Respect would indicate a rally to 9200, while failure would complete a double top reversal, signaling a test of primary support at 8200. Rising 13-week Twiggs Money Flow suggests medium-term buying pressure but the long-term picture remains negative. Breach of 8200 would signal a primary down-trend with an initial target of 7200*.
* Target calculation: 8200 – ( 9200 – 8200 ) = 7200
South Korea’s Seoul Composite Index is consolidating between 1950 and 2000. Rising 13-week Twiggs Money Flow indicates buying pressure. Breakout above 2000 is likely, followed by a test of the year’s high at 2050.
* Target calculation: 2050 + ( 2050 – 1900 ) = 2200
India’s Sensex is retracing to test the new support level at 18500. Respect would signal a strong up-trend, but even retracement to 18000 would not be cause for concern. Rising troughs above zero on 13-week Twiggs Money Flow indicate buying pressure. Follow-through above 19000 would signal an advance to 21000*.
* Target calculation: 18.5 + ( 18.5 – 16.0 ) = 21.0
Singapore’s Straits Times Index retreated from resistance at 3100. Expect another test of support at 3000; confirmed if short-term support at 3050 is breached. Recovery above 3100 would confirm an advance to 3300 — as would a 63-day Twiggs Momentum trough above zero.
* Target calculation: 3000 + ( 3000 – 2700 ) = 3300
India’s Sensex is holding above 18500, confirming the primary up-trend. Rising troughs above zero on 13-week Twiggs Money Flow indicate buying pressure. Follow-through above 19000 would signal an advance to 21000*.
* Target calculation: 18.5 + ( 18.5 – 16.0 ) = 21.0
Singapore’s Straits Times Index is testing resistance at 3100. Narrow consolidation indicates buying pressure and breakout above 3100 would signal an advance to 3300*. A 63-day Twiggs Momentum trough above zero would signal a strong primary up-trend.
* Target calculation: 3000 + ( 3000 – 2700 ) = 3300
Japan’s Nikkei 225 is headed for a test of support at 8650. Failure would complete a double top reversal, signaling a test of primary support at 8200. Respect of zero (from below) by 13-week Twiggs Money Flow indicates selling pressure. Breach of 8200 would signal a primary down-trend with an initial target of 7200*.
* Target calculation: 8200 – ( 9200 – 8200 ) = 7200
South Korea’s Seoul Composite Index is consolidating below 2000 on the daily chart. Rising 21-day Twiggs Money Flow, high above zero, indicates medium-term buying pressure. Expect a test of this year’s high at 2050. Breakout would signal a primary advance to 2350*.
* Target calculation: 2050 + ( 2050 – 1750 ) = 2350
Chinese exchanges are closed the entire week for Mid-Autumn Festival and National Day. The Shanghai Composite Index is headed for a re-test of 2150. Oscillation of 13-week Twiggs Money Flow around zero indicates hesitancy. Respect of resistance is likely and would signal a decline to 1800*.
* Target calculation: 2150 – ( 2500 – 2150 ) = 1800
Hong Kong’s Hang Seng Index is closed Monday/Tuesday but will re-open Wednesday. Rising 13-week Twiggs Money Flow above zero indicates strong buying pressure. Expect retracement to test 20000 but respect is likely and would signal an advance to 22000.
* Target calculation: 20 + ( 20 – 19 ) = 21
Interesting quote from Professor Ross Garnaut in the AFR:
He [Professor Garnaut] said Australia’s terms of trade, or income from exports, would be hit by three “mutually reinforcing negatives” under way in China.
The first was a shift in China’s economy away from a focus on heavy industrial investment and exports, which have driven metals and energy demand. The second was a wave of internal reforms including the move towards lower carbon emissions that would cruel demand for Australian thermal coal. The third was the current “cyclical” downturn that was likely to continue.
“It’s an accident they’re coming all at once, but they are,” Professor Garnaut said
From Leith van Onselen at Garnaut’s bitter pill must be swallowed | | MacroBusiness.
by Zarathustra
Rail cargo volume growth fell further from -8.2% yoy in July to -9.2% yoy in August, worst since the financial crisis. Cargo volume transported by the railways amounted to 304 million tonnes in August 2012, slightly below 305 million tonnes in July.
by Zarathustra
After a long period since late last year as Chinese Yuan was expected to depreciate, it appears that the expectation of Chinese Yuan appreciation is back on people’s mind. Chinese Yuan hits the highest level since the revaluation started in 2005, completely reversing the depreciation since earlier this year…..
via Chinese Yuan hits highest level against USD, but PBOC wants it weaker.
By JANE PERLEZ
Notions of punishing Tokyo economically for buying the islands, whose status was left unclear after World War II, are unrealistic, said Hu Shuli, editor in chief of Caixin Media and one of China’s chief economic journalists. So many Chinese workers are employed at Japanese-owned companies, she said, that any escalation of tensions leading to a boycott of Japanese goods could lead to huge job losses.
This would be disastrous in an already shaky Chinese economy, Ms. Hu wrote in the Chinese magazine Century Weekly……
via China Alters Its Strategy in Dispute With Japan – NYTimes.com.
By Roseann Lake
As a result of the real estate boom, reports in Chinese media indicate that the average property in a top-tier Chinese city now costs between 15 and 20 times the average annual salary, though J.P. Morgan reports indicate something closer to 13. For purposes of comparison, in most of the world’s cities, the housing-cost-to-income ratio hovers between 3-to-1 and 6-to-1, rounding out at about 3-to-1 in the United States. This is especially problematic in China, where thanks to still-prevalent Confucian ideals of the male as the “provider,” home ownership has become an unspoken prerequisite to marriage. It’s a tough, competitive life for men in China these days, in part due to the aftershocks of the one-child policy, which has left the country with a gaping gender imbalance of 120 boys for every 100 girls……
China’s Shanghai Composite Index followed through below recent support at 2050. Declining 13-week Twiggs Money Flow, below zero, indicates selling pressure. Target for the decline is 1800*.
* Target calculation: 2150 – ( 2500 – 2150 ) = 1800
South Korea’s Seoul Composite Index is headed for a test of 2050. The 13-week Twiggs Money Flow trough above zero suggests a primary up-trend. Breakout above 2050 would confirm.
* Target calculation: 2050 + ( 2050 – 1750 ) = 2350
India’s Sensex broke through 18500, confirming the primary up-trend. The trough above zero on 13-week Twiggs Money Flow indicates buying pressure. Expect retracement to test the new support level.
* Target calculation: 18.5 + ( 18.5 – 16.0 ) = 21.0
Singapore’s Straits Times Index is testing medium-term resistance at 3100. Rising 63-day Twiggs Momentum, above zero, indicates a primary up-trend. Breakout above 3100 would indicate an advance to 3300*.
* Target calculation: 3000 + ( 3000 – 2700 ) = 3300
Japan’s Nikkei 225 retreated below the new support level at 9200. Reversal of 13-week Twiggs Money Flow below zero warns of a bull trap. Follow-through below 9000 would confirm.
* Target calculation: 9200 + ( 9200 – 8200 ) = 10200
By Floyd Norris
Estimates by the Treasury Department released this week indicated that over the 12 months through July, China reduced its position in Treasury securities by $165 billion, cutting them to $1.15 trillion despite making a small amount of purchases in July. And the Federal Reserve reported that, as of Wednesday, it owned $1.65 trillion in Treasury securities, $17 billion less than it had owned a year earlier.
…..China’s selling of Treasuries over the 12-month period was offset by the actions of Japan, another country whose trade surplus with the United States remains large. The Japanese are estimated to have increased their holdings by $232 billion over the 12 months, to $1.12 trillion. Those figures include both government and private holders of Treasuries.
