Updates closing prices, adds analyst comment and details
SINGAPORE, April 30 (Reuters) –
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Japanese rubber futures rose on Tuesday amid a weaker yen and favourable factory data, but logged their first monthly decline in 2024 and worst month since October 2022.
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The Osaka Exchange’s (OSE) rubber contract for October delivery JRUc6, 0#2JRU: closed up 1.6 yen, or 0.52%, at 307 yen ($1.96) per kg.
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The contract snapped a three-month winning streak to end April 6.57% lower. It had gained 10.64% in March amid fears of supply tightness, which is now seen easing as the rubber harvesting season nears.
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The rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery SNRv1 closed down175 yuan at 14,045 yuan ($1,938.90) per metric ton, ahead of the upcoming holidays.
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The Japanese yen JPY= weakened 0.29% to 156.82 against the dollar. FRX/
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Japan’s March factory output grew more than expected, after automakers resumed production after safety scandals.
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Top rubber consumer China’s April manufacturing activity expanded at a slower pace, an official factory survey showed, although aprivate survey showed activity expanded at the fastest pace in 14 months.
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“Although today’s PMI data can offer some relief, investor sentiment is still pressured by China’s weak consumer spending and dwindling exports,” said Jom Jacob, co-founder of India-based analysis firm What Next Rubber.
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Concerns over prolonged high borrowing costs in the U.S. also weighed on market sentiment, Jacob added. FEDWATCH
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China’s industrial profits fell in March and slowed gains for the quarter compared to the first two months, official data showed.
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The front-month rubber contract on Singapore Exchange’s SICOM platform for May delivery STFc1 traded at 160.5 U.S. cents per kg, down 0.3% on its last trading day.
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Financial markets in China and Singapore are closed on Wednesday for a holiday, and will re-open on May 6 and May 2 respectively.
($1 = 156.7800 yen)
($1 = 7.2438 yuan)
Let’s break down the key points:
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Market Overview:
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Japanese rubber futures rose on Tuesday due to a weaker yen and favorable factory data.
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However, despite this recent uptick, they recorded their first monthly decline in 2024 and the worst month since October 2022.
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Osaka Exchange (OSE) Contract:
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The OSE rubber contract for October delivery (JRUc6) closed at 307 yen per kilogram, up 1.6 yen (or 0.52%).
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Interestingly, this contract had previously enjoyed a three-month winning streak, but it ended April 6.57% lower.
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In March, it had surged by 10.64% due to concerns about supply tightness, which are now easing as the rubber harvesting season approaches.
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Shanghai Futures Exchange (SHFE) Contract:
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The rubber contract on the SHFE for September delivery (SNRv1) closed at 14,045 yuan per metric ton, down 175 yuan.
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This decline occurred ahead of the upcoming holidays.
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Currency Impact:
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The Japanese yen (JPY) weakened by 0.29% against the dollar, making yen-denominated assets more attractive to overseas buyers.
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Japan’s Factory Output:
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Japan’s factory output in March exceeded expectations, driven by automakers resuming production after safety scandals.
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China’s Manufacturing Activity:
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China’s official factory survey indicated that manufacturing activity expanded at a slower pace in April.
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However, a private survey showed that activity expanded at the fastest pace in 14 months.
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Investor Sentiment and Concerns:
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Investor sentiment remains under pressure due to China’s weak consumer spending and dwindling exports.
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Additionally, concerns about prolonged high borrowing costs in the U.S. are weighing on market sentiment.
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Singapore Exchange’s SICOM Platform:
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The front-month rubber contract for May delivery (STFc1) traded at 160.5 U.S. cents per kg, down 0.3% on its last trading day.
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Market Closures:
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Financial markets in China and Singapore are closed on Wednesday for a holiday and will reopen on May 6 and May 2, respectively.
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Keep an eye on these market dynamics as they continue to evolve, especially considering the global economic context and currency fluctuations!
– Reuters
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