SINGAPORE: Japanese rubber futures slid 1.5% on Monday as lower demand for the tyre-making raw material pressured prices, while fears of a wider conflict in the Middle East weighed on sentiment across the markets. Washington warned over the weekend of a significant risk to US interests in the region as ally Israel pounded Gaza and clashes on its border with Lebanon intensified.
The Osaka Exchange (OSE) rubber contract for March delivery lost 3.9 yen, 1.5%, to 255.9 yen ($1.71)per kg, hitting its lowest since Oct. 13 earlier on Monday. The rubber contract on the Shanghai futures exchange (SHFE) for January delivery gave up 80 yuan, or 0.6%, at 14,480 yuan ($1,978.79) per metric ton.
“Rubber demand from tyre manufacturers has been tepid,” said one Singapore-based trader. “In an over-supplied market demand factors weigh in more heavily than supply factors.” The trader added that heavy rains in Thailand and Vietnam had hit rubber supplies.
Global shares hit seven-month lows on Monday as the risk of a wider conflict in the Middle East and the prospect of a long stretch of high interest rates soured sentiment at the start of a week full of mega-cap earnings and key data.
Japan’s Nikkei share average closed below the psychologically important 31,000-level on Monday as events in the Middle East kept investors on edge, sending a gauge of volatility spiking to a one-year high. The front-month rubber contract on Singapore Exchange’s SICOM platform added 0.1% to 144.8 US cents per kg.
Source: Brecorder
