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[Geojit Comtrade] Daily report on Natural Rubber: January 22, 2014

MARKET COMMENTARY

A mixed trend was witnessed in the Indian markets on Tuesday. While the quotes in the physical market steadied near Rs.151 a kg, on NMCE, rubber futures were seen declining after the recent short covering rallies from the 42-month lows hit last week. The benchmark February rubber futures dropped more than one per cent. Weak underlying fundamentals continued to pressurize prices to move south though anticipation of recovery during the lean production phase lend lower level support. A mixed trend is also being witnessed in the overseas market. On Wednesday, SHFE and AFET rubber futures inched up after the previous session declines while TOCOM rubber futures ticked lower. However, concerns over slowing economic growth and burgeoning stockpiles in the top consumer China pondered upon the market.

MARKET NEWS

Crude rubber stockpiles held at Japanese warehouses rose 4.8 percent to 13,164 metric tons on Jan. 10, according to data from the Rubber Trade Association of Japan.

Rubber inventories in the warehouses monitored by SHFE rose 5.6 per cent to 200815 tonnes last week.

Rubber inventories in Qingdao, China’s main hub for the commodity, advanced to 304,300 metric tons today, from 290,700 tons at the end of December, the Qingdao International Rubber Exchange said.

China imported 350,000 tonnes of rubber in December, up 66.7 percent on the same month a year ago.

According to Thai Office of Agricultural Economics, rubber production in Thailand may rise 4.3 per cent in 2014 to 4.03 million tonnes.

Annual car sales in India declined for the first time in 11 years in 2013, posting a 9.59 percent fall, according to SIAM.

Natural rubber imports by India in December jumps 46 per cent to 26853 tonnes year on. Production falls 5.3 per cent to 108000 tonnes while consumption rose about 1.4 per cent to 79500 tonnes during the same period.

TECHNICAL VIEW

 RUBBER Feb NMCE

Inability to break the stiff resistance at 15550 saw prices edging lower in the previous session. For the day, 15200-15100 ranges seem to be a considerably good supports level, which if held could call for a bounce back. Still, it is mandatory to successfully find a place above 15550 for further upsides. Slippage past 15100 may have the potential to revisit the recent lows or more.

TURNAROUND

Resistances

LEVELS

 Supports

15480-15550

15550-15100-14850

15200/15100

15750/15800

15000/14850

15950-16050

14800/14600

 

Source: Geojit Comtrade

Download this report (full content – PDF file) here

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