January 29, 2020 / 3:56 AM / a month ago

VEGOILS-Palm oil climbs the most in 11 years after Tuesday's sharp drop

    JAKARTA, Jan 29 (Reuters) - Malaysian palm oil futures rose
more than 9% on Wednesday, their biggest intraday gain in 11
years, after declining sharply in the previous session on fears
the fast-spreading coronavirus would curb demand from major
importer China.
    The benchmark palm oil contract          for April delivery
on the Bursa Malaysia Derivatives Exchange gained as much as
9.1% in early trade, its most since Nov. 5, 2008, to 2,810
ringgit ($691.27) per tonne. On Tuesday, palm oil prices dropped
10% in their biggest drop in over a decade. 
    "The drop because of coronavirus worries yesterday was
overdone. Now, the market is doing some adjustment," said a
Kuala Lumpur-based trader.  
    The death toll from the coronavirus outbreak in China rose
to 132 with nearly 1,500 new cases.                          
    Helping the gain in palm oil prices, soyoil on the Chicago
Board of Trade climbed 0.9%, as investors took stock of the
economic impact of the coronavirus.             
    Palm oil is generally affected by price movements in related
oils as its competes for a share in the global vegetable oil
market.
        
    FUNDAMENTALS
    * Chicago soybean futures edged higher as the market took a
breather after dropping to a more than one-month low earlier
this week, although gains were capped by concerns over China's
demand.       
    * Oil prices rose for a second day, standing on firmer
ground after a five-day fall on talk OPEC could extend oil cuts
if the new coronavirus hurts demand, while data showing a
decline in U.S. stockpiles helped steady prices.      
    
    MARKET NEWS
    * Asian shares erased earlier gains, swinging into negative
territory as a spike in new Chinese virus cases sent Hong Kong
stocks tumbling and fuelled fears about the economic impact of
the outbreak.               
    * U.S. stocks rebounded on Tuesday, as the S&P 500 bounced
back from its worst day in nearly four months, led by a climb in
Apple and other names hit by exposure concerns to the
coronavirus outbreak in China that sparked a recent
sell-off.    
    * Risk currencies steadied on Wednesday as investors took
stock of the economic damage from the outbreak of the
coronavirus originating in China.       
    
DATA/EVENTS (GMT)
0700   Germany   GfK Consumer Sentiment         Feb
0700   Germany   Import Prices MM, YY           Dec 
0700   UK        Nationwide House Price MM, YY  Jan
0745   France    Consumer Confidence            Jan
0900   EU        Money-M3 Annual Growth         Dec
1500   US        Pending Sales Change MM        Dec
1900   US        Federal Open Market Committee announces its
decision on interest rates followed by statement
    
($1 = 4.0650 ringgit)

 (Reporting by Fransiska Nangoy; Editing by Subhranshu Sahu)
 
 
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