TOKYO, April 19 (Reuters) – Benchmark TOCOM rubber futures surged more than 3 percent on Tuesday, bouncing back from a one-week low hit the previous day, as a weaker yen against the U.S.dollar and firmer oil prices prompted short-covering.
A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
FUNDAMENTALS
The Tokyo Commodity Exchange rubber contract for September delivery JRUc6 0#2JRU: was up 5.8 yen, or 3.1 percent, at 193.3 yen ($1.77) per kg as of 0056 GMT, after falling 1.5 percent to a one-week low the previous day on slumping oil prices.
Crude rubber inventories at Japanese ports stood at 12,624 tonnes as of March. 31, down 3.1 percent from the last inventory date, data from the Rubber Trade Association of Japan showed on Monday.
Kuwait plans to boost crude oil production back to normal levels, despite an open-ended strike by Kuwaiti oil workers, an official from state refiner Kuwait National Petroleum Co (KNPC) was quoted as saying on Monday.
The Japanese share market tumbled on Monday after a series of earthquakes measuring up to 7.3 magnitude struck a southern manufacturing hub, killing at least 42 people and forcing major companies including Toyota 7203.T and Honda 7267.T to close factories.
MARKET NEWS
The dollar gained 0.2 percent to 109.10 yen JPY= , turning positive on the week after a fall to one-week low of 107.75 on Monday. As risk appetite in broader financial markets recovered, the U.S.dollar held the upper hand against the low-yielding yen.
Oil prices edged up in early trading on Tuesday as an oil worker strike in Kuwait cut huge amounts of crude out of the supply chain. O/R
Japan’s benchmark Nikkei stock average (XC0009692440) jumped 3.5 percent in Tuesday trade on the back of a softer yen and after the Dow Jones industrial average closed above 18,000 for the first time since July.
DATA/EVENTS (GMT)
The following data is expected on Tuesday: (Time in GMT)
0900 Germany ZEW economic sentiment Apr
1230 U.S. Housing starts Mar 1230 U.S. Building permits Mar
($1 = 109.0700 yen)
(Reporting by Yuka Obayashi; Editing by Ed Davies)
