TOKYO (Oct 24): Benchmark Tokyo rubber futures climbed on Monday, snapping a 4-day losing streak and bouncing back from a 10-day low hit last week, as higher Shanghai futures prompted short-covering.
The Tokyo Commodity Exchange (TOCOM) rubber contract for March delivery <0#2JRU:> finished 4.7 yen, or 2.7%, higher at 178.6 yen (US$1.72) per kg.
“The TOCOM was just tracking Shanghai move,” a Tokyo-based dealer said.
“I think the rebound will be short-lived as it came as some investors in China who have oversold on Friday unwound their positions,” he said.
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The most-active rubber contract on the Shanghai futures exchange for January delivery rose 290 yuan to finish at 13,905 yuan (US$2,053.67) per tonne, rebounding from a 3-week low touched last Friday.
The market paid little attention to China’s trade data that showed a 36.5% drop in import of natural rubber in September from a year earlier.
A softer yen against the US dollar also lent some support to the TOCOM futures, dealers said.
The dollar added 0.2% to 103.97 yen, buoyed by expectations that the US Federal Reserve would raise interest rates this year. A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
The front-month rubber contract on Singapore’s SICOM exchange for November delivery last traded at 145.8 US cents per kg, up 0.4 cent.
(US$1 = 103.8700 yen)
(US$1 = 6.7708 Chinese yuan)
