TOKYO (Dec 9): Benchmark Tokyo rubber futures ended up 1.1% on Wednesday getting support from a rebound in global oil prices, while firm Japan machinery orders offered some support.
The Tokyo Commodity Exchange rubber contract for May delivery finished 1.8 yen higher at 172.6 yen per kg, after hitting near a two-month high earlier.
The May contract has risen 10% since its debut late in November on the back of strength in Shanghai futures’ benchmark contract for the same month delivery, industry sources said.
“Short-covering continues to be at work to support TOCOM, and the market sentiment has improved somewhat,” said a Tokyo-based broker source who declined to be identified.
Oil prices rose on Wednesday, after industry data showed a surprise drop in U.S. crude stocks.
Japan’s core machinery orders unexpectedly jumped in October, rising by the most since March 2014, government data showed on Wednesday, an indication of renewed investment that eased concerns about weakness in capital spending.
The most-active rubber contract on the Shanghai futures exchange for May delivery fell 45 yuan to finish at 10,205 yuan per tonne.
The U.S. dollar was quoted around 122.68 yen, compared with around 123.08 yen on Tuesday afternoon.
Thailand on Tuesday approved US$139 million in additional loans, to help rubber farmers in the Southeast Asian country hit by weak global prices of the commodity.
The front-month rubber contract on Singapore’s SICOM exchange for January delivery last traded at 118.2 U.S. cents per kg, up 0.9 cent.
