TOKYO, May 11 (Reuters) – Benchmark Tokyo rubber futures edged down on Wednesday, surrendering earlier gains after oil prices came under pressure and the yen rebounded against the U.S.dollar, dealers said.
The Tokyo Commodity Exchange rubber contract for October delivery JRUc6 0#2JRU: finished 0.5 yen, or 0.3 percent, lower at 181.2 yen ($1.67) per kg, not too far away from a one-month low of 178 yen hit in the previous session. It rose to as high as 183.7 yen in early trade on Wednesday. “The market lost ground after oil started dropping and the yen bounced back,” said Hiroyuki Kikukawa, general manager of research at Nissan Securities.
Oil prices dipped on Wednesday as Canadian oil sands production was expected to gradually ramp up following forced closures due to wildfires, and as record crude inventories especially in the United States put pressure on markets. O/R The dollar fell 0.4 percent against the yen to 108.83 JPY= as investors locked in gains following its steep rise against the yen after intervention warnings from Japanese officials. It moved back toward last week’s low of 105.55, which marked its lowest since October 2014, after climbing to a two-week high of 109.38 yen early in the Asian session. FRX/ A stronger yen makes yen-denominated assets less affordable when purchased in other currencies.
“All eyes will be on the oil market and China’s economic indicators,” Kikukawa said, adding whether or not the benchmark can hold at a 180 yen support would set a trend. The most-active rubber contract on the Shanghai futures exchange for September delivery SNRcv1 rose 30 yuan to finish at 11,875 yuan ($1,823.28) per tonne. The front-month rubber contract on Singapore’s SICOM exchange for June delivery STFc1 last traded at 145.7 U.S. cents per kg, down 0.6 cent.
($1 = 108.7200 yen)
($1 = 6.5130 Chinese yuan)
(Reporting by Yuka Obayashi; Editing by Subhranshu Sahu)
