TOKYO, April 30 (Reuters) – Benchmark Tokyo rubber futures edged down on Wednesday, following a weak tone in the Shanghai market amid concerns about Chinese demand, leading to a 12 percent plunge for the month.
The benchmark rubber contract on the Tokyo Commodity Exchange (TOCOM) for October delivery fell 0.8 yen to settle at 205.5 yen ($2.00) per kg.
The contract rose as high as 209 yen, its highest since April 18, in early trade on firm Japanese equities and a weaker yen, but it pared gains after the Shanghai market fell more than 200 yuan, dealers said.
The most-active rubber contract on the Shanghai futures exchange for September delivery lost 240 yuan to finish at 14,340 yuan ($2,300) per tonne.
Japan’s Nikkei stock average slightly rose on Wednesday but logged a drop of 3.5 percent for April, while the yen strengthened after upbeat Bank of Japan economic projections suggested no additional stimulus was on the near-term horizon.
“The Tokyo rubber market could not keep its strength after Shanghai futures dipped,” said Toshitaka Tazawa, an analyst with Fujitomi Co.
“Also, investors apparently wanted to clear their positions ahead of holidays,” he added.
Japanese markets, which were closed on Tuesday, will be shut on May 5 and 6 for national holidays, while Chinese markets will be closed on Thursday and Friday for the Labour Day holiday.
“The market is expected to stay under pressure in May given concerns about Chinese demand and high inventories in Thailand and Philippines,” Tazawa said.
The front-month rubber contract on Singapore’s SICOM exchange for May delivery last traded at 176.00 U.S. cents per kg, up 1.50 cents.
($1 = 102.5500 Japanese Yen)
($1 = 6.2580 Chinese Yuan)
(Reporting by Yuka Obayashi; Editing by Subhranshu Sahu)
