TOKYO, Sept 28 (Reuters) – Benchmark Tokyo rubber futures inched up on Monday, supported by technical buying, but gains were capped as investors continued to worry about weakening demand in top buyer China and the impact of the Volkswagen (VLKPF)diesel emissions scandal. The Tokyo Commodity Exchange rubber contract for March delivery JRUc6 0#2JRU: finished 1.1 yen, or 0.6 percent, higher at 170.6 yen ($1.42) per kg, after recovering from a low of 169.4 yen. “We saw an increased technical buying at below 170 yen,” said Satoru Yoshida, commodity analyst at Rakuten Securities.
“Still, many investors were hesitant to take fresh positions as they don’t know how the Volkswagen saga would affect global automobile sales,” he said. Volkswagen named company veteran Matthias Mueller as its chief executive on Friday and shook up the way it is organised, as the German carmaker tries to get to grips with a crisis over rigged diesel emission tests that keeps growing.
Trade overall was light as China stock markets were relatively quiet, dealers said. China stocks edged higher in thin trading on Monday, as investors remained cautious while shrugging off data showing profits of Chinese industrial companies in August declined at the sharpest rate in four years.
.SS The profit decline came as costs kept rising and product prices kept falling, according to official data that adds to signs of weakness in the world’s second largest economy. The most-active rubber contract on the Shanghai futures exchange for January delivery SNRcv1 fell 25 yuan to finish at 11,580 yuan ($1,818.47) per tonne. The front-month rubber contract on Singapore’s SICOM exchange for October delivery STFc1 last traded at 125.0 U.S. cents per kg, down 0.8 cent.
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($1 = 120.1700 yen) ($1 = 6.3680 Chinese yuan)
(Reporting by Yuka Obayashi; Editing by Biju Dwarakanath)
