TOKYO (Dec 4): Benchmark Tokyo rubber futures edged lower on Friday, weighed down by profit-taking after a three-day rally and weaker Tokyo stock prices, but managed to post their biggest weekly gain in three months.
Tokyo Commodity Exchange (TOCOM) futures, which set the tone for tyre rubber prices in Southeast Asia, had fallen nearly 40% by early November since hitting this year’s high in early June on growing fears about slowing demand in top buyer China.
But prices have since recovered by about 10%, with some investors suggesting the long bearish trend is finally turning around.
“But it seems the buying spree has already run out of steam as rubber prices had climbed too quickly this week,” said a Tokyo-based dealer who declined to be named.
“December is traditionally a good month for the rubber market, but we may not see the same result this year,” he said.
The TOCOM rubber contract for May delivery <0#2JRU:> finished 0.6 yen lower at 170.1 yen (US$1.39) per kg on Friday.
For the week, the contract gained 4.5%, marking the biggest weekly increase since early September. It hit a high of 171.7 yen on Thursday, the highest since Oct. 19.
On the downside, Japan’s Nikkei tumbled 2.2% at the close on Friday, joining a global markets slump after theEuropean Central Bank‘s stimulus package fell well short of market expectations.
The most-active rubber contract on the Shanghai Futures Exchange for May delivery fell 10 yuan to finish at 10,190 yuan (US$1,591.99) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for January delivery last traded at 116 U.S. cents per kg, down 1.2 cent.
(US$1 = 6.4008 Chinese yuan)
(US$1 = 122.7200 yen)
