TOKYO, Oct 22 (Reuters) – Benchmark Tokyo rubber futures dropped for a fifth straight session on Thursday, diving to a 1-1/2 month low, as lingering worries over slowing demand growth in China and oversupply in Asia continued to weigh on sentiment. The Tokyo Commodity Exchange (TOCOM) rubber contract for March delivery JRUc6 0#2JRU: finished 2.4 yen, or 1.4 percent, lower at 164.1 yen ($1.37) per kg. It earlier touched 163.6 yen, the lowest since Sept.7 when the benchmark hit a fresh 6-year low.
“The market took a beating from weaker Shanghai rubber futures and slumping Chinese share prices, although the stock market bounced back sharply toward the end of the trade,” said Toshitaka Tazawa, analyst at Fujitomi Co. The most-active rubber contract on the Shanghai Futures Exchange for January delivery SNRcv1 fell 90 yuan to finish at 11,210 yuan ($1,764.02) per tonne, after sliding to as low as 11,090 yuan. China stocks rebounded more than 1 percent on Thursday, with the previous session’s roughly 3 percent slide seen as creating a buying opportunity for some investors who missed the recent rebound.
.SS “Investors are tired of selling, but they can’t make fresh buying due to persistent worries over softening demand growth in China,” Tazawa said. TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, have lost about 6 percent over the past five sessions.
“It’s difficult to project where the market is headed from here. But if the benchmark falls below the September low of 162.7 yen, it may trigger a flurry of sells,” he added. The front-month rubber contract on Singapore’s SICOM exchange for November delivery STFc1 last traded at 124.5 U.S. cents per kg, up 0.5 cent. ($1 = 119.7700 yen) ($1 = 6.3548 Chinese yuan)
(Reporting by Yuka Obayashi; Editing by Sunil Nair)
