Rubber rebounded from a two-week low as oil rallied while manufacturing in China, the biggest user, unexpectedly strengthened and the Federal Reserve maintained its bond-buying program to support recovery.
The contract for delivery in January gained as much as 2.1 percent to 245.3 yen a kilogram ($2,505 a metric ton) on the Tokyo Commodity Exchange and was at 244.1 yen at 10:52 a.m. The most-active contract settled at the lowest since July 16 yesterday, paring gains for July to 1.7 percent.
Oil in New York extended gains after capping the biggest monthly rally since August. China’s manufacturing unexpectedly strengthened in July, suggesting a slowdown in the second-largest economy may be stabilizing as the government rolls out targeted measures to support growth. The Fed, which has floated the prospect of reductions to its stimulus program should economic risks abate, said yesterday while growth should pick up, persistently low inflation may hamper the recovery.
“The Fed statement stoked speculation that they may delay curtailment in stimulus, spurring investors to buy back futures,” said Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo.
The Purchasing Managers’ Index was at 50.3, the National Bureau of Statistics and China Federation of Logistics and Purchasing said today in Beijing. That compared with the 49.8 median forecast of 35 analysts in a Bloomberg News survey and June’s 50.1 level. Readings above 50 indicate expansion.
Rubber for January delivery added 0.9 percent to 18,070 yuan ($2,948) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board fell 0.6 percent to 76.75 baht ($2.45) a kilogram yesterday, the lowest level since October 2009, according to the Rubber Research Institute ofThailand.
Source: Bloomberg
