TOKYO (Aug 14): Benchmark Tokyo rubber futures skidded on Friday, dragged down by U.S. crude oil prices which hit their lowest in almost 6-1/2 years, but the contract marked a small gain for the week amid thin trade as many traders were away for holiday, dealers said.
The Tokyo Commodity Exchange (TOCOM) rubber contract for January delivery <0#2JRU:> finished 0.4 yen, or 0.2 percent, lower at 193.9 yen ($1.56) per kg.
TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, rose 0.3 percent for the week, their first weekly gain in four.
“Rubber was weighed down by slumping oil prices,” said Hiroyuki Kikukawa, general manager at Nihon Unicom Inc.
U.S. crude oil fell to its lowest in almost six-and-a-half years on Friday as huge stockpiles and refinery shutdowns heightened concerns about global oversupply and slowing economies in Asia.
“But the losses were limited, as Shanghai stocks held up well, giving investors relief.”
Shanghai’s benchmark stock index edged up on Friday and had its biggest weekly rise in more than two months, as investors turned bullish after concerns about the yuan’s depreciation eased.
“But overall sentiment in the rubber market is likely to stay weak next week as oil prices are in a downtrend and China’s auto demand is softening,” Kikukawa said.
Auto sales in China fell 7.1 percent in July from a year earlier to 1.5 million vehicles, their biggest decline since February 2013, an industry association said earlier this week.
The most-active rubber contract on the Shanghai futures exchange for January delivery fell 110 yuan to finish at 12,280 yuan ($1,921.51) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for September delivery last traded at 134.0 U.S. cents per kg, down 1.2 cent.
($1 = 124.2800 yen)
($1 = 6.3908 Chinese yuan)
