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Morning markets: palm oil touches three-month low

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Sentiment has no trouble crossing thousands of miles, as palm oil showed on Friday by touching its lowest for nearly three months.

The weak close to Chicago food commodities' latest session – the last ahead of a long weekend – set the tone in Kuala Lumpur, focusing traders on potential negative influences.

And they did not have to look far. Besides the longstanding fears of rising Malaysian production, and sagging exports, oil remained depressed, below $67 a barrel, after falling 4% overnight following the weak US jobs figures.

Exports question

Stockmarkets were generally weak, with Australian stocks down 1.3% and Tokyo's Nikkei share index closing down 0.6%.

Meanwhile, September soyoil slipped 3.4% on China's Dalian commodity exchange.

On the Bursa Malaysia Derivatives Exchange, benchmark September palm oil closed the morning session down 33 ringgit at 2,142 ringgit a tonne, having touched 2,123 ringgit earlier its lowest since early April.

"For the market to rebound, I guess we must wait to see how exports perform in the first 10 days of July," a broker said.

Chicago declines

On Thursday, July corn closed down 1.7% at $3.45 ¾ a bushel in Chicago, a four-month low, taking its declines for the week to 10%.

Prices were badly dented by data showing greater-than-expected US plantings, before the soft US jobs data tumbling external markets and the strengthening dollar chipped in as well.

July wheat ended down 6 cents at $5.00 ¼ a bushel, its lowest since March 11, with soybeans for July slipping 15.5 cents to $12.43 a bushel.

US markets are closed on Friday for the Independence Day holiday.

By Mike Verdin

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