TOCOM rubber plunges on pessimism about global growth

0
209

(Jan 22): Benchmark futures plunged nearly 4% on Tuesday, sliding from a nearly 8-month high hit the previous day, amid pessimism about global growth and signs of economic slowdown in China, the world’s top rubber buyer.

The International Monetary Fund (IMF) trimmed its global growth forecasts on Monday and a survey showed increasing pessimism among business chiefs as trade tensions and uncertainty loomed over the world’s biggest annual gathering of the rich and powerful.

Downward pressure on the economy will impact China’s job market, the state planner warned on Tuesday, a day after data showed gross domestic product grew at its slowest since 1990.

“Weaker economic outlook for China and IMF’s lower prediction for growth hit investors’ sentiment,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.

Article continues below Advertisement...

The Tokyo Commodity Exchange rubber contract for June delivery finished 7.7 yen, or 3.9%, lower at 183.6 yen ($1.68) per kg.

But the TOCOM’s January contract rose 2.1%.

“The rally for the near-month contracts is apparently helped by continued buying from Chinese speculators,” Yoshida said.

TOCOM’s technically specified rubber (TSR) 20 futures contract for delivery fell 2.8% to close at 153.6 yen per kg.

The most-active rubber contract on the Shanghai futures exchange for May delivery plunged 240 yuan to finish at 11,580 yuan (US$1,701) per tonne.

The front-month rubber contract on Singapore’s SICOM exchange for February delivery last traded at 134.9 US cents per kg, down 1.9%.

(US$1 = 6.8081 Chinese yuan renminbi)
(US$1 = 109.4400 yen)

LEAVE A REPLY

Please enter your comment!
Please enter your name here