TOKYO (June 7): Benchmark Tokyo rubber futures ended lower on Tuesday, retreating from a one-week high hit earlier in the session, on softer Shanghai futures and as buying ran out of steam with no fresh fundamental support, dealers said.
The Tokyo Commodity Exchange (TOCOM) rubber contract for November delivery <0#2JRU:> finished lower 2.4 yen, or 1.5%, at 157.0 yen (US$1.46) per kg. It earlier rose to a high of 162.8 yen, the highest since June 1, on the back of bargain hunting.
“The market started with a positive tone, but investors apparently could not find good reasons to keep buying,” said Toshitaka Tazawa, analyst at Fujitomi Co.
“Since the TOCOM benchmark has slumped over the past month or so, and given firmer oil and stock prices, investors were and will be hesitant to step up selling,” he said, predicting trades without a clear sense of direction for a while.
The TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, marked a sixth straight weekly loss last week amid lingering worries over slowing demand in top buyer China.
Brent crude hovered near a seven-month high on Tuesday, retaining the bulk of gains from the previous session, as market sentiment was bolstered by factors such as Nigerian oil infrastructure attacks and projections for falling US crude inventories.
Japanese share prices bounced back from a four-week low on Tuesday after Federal Reserve Chairwoman Janet Yellen held back from giving a clear hint on the Fed’s rate hike timing, even as she stuck to the script that an increase is likely reasonably soon.
The most-active rubber contract on the Shanghai futures exchange for September delivery dropped 40 yuan to finish at 10,560 yuan (US$1,607.06) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for July delivery last traded at 127.0 US cents per kg, down 2.1 cent.
(US$1 = 107.6000 yen)
(US$1 = 6.5710 Chinese yuan renminbi)
