TOKYO: Benchmark Tokyo rubber futures rose for a third day to fresh three-month highs on Thursday as continuous gains in Japanese equities and a soft yen outweighed slightly-weaker-than-expected economic data from China, the world’s biggest consumer.
The Tokyo Commodity Exchange rubber contract for April delivery finished 1.2 yen higher at 206.0 yen($1.7819) per kg. It climbed to as high as 206.3 yen, the highest since Aug. 7.
The contract started with a weak tone, weighed by light profit-taking, but recovered on technical buying and short-covering from funds amid a bullish trend in Japanese equities and a weak yen, a Tokyo-based dealer said.
The dollar edged back toward a seven-year high struck earlier this week against the yen, as speculation swirled that Japan’s Prime Minister Shinzo Abe will call a snap election in December.
Japanese stocks rose to fresh seven-year highs on Thursday as investors lapped up a media report that said Abe appears to have decided to call an early election amid mounting expectations he would postpone a planned sales tax hike.
China’s industrial output rose 7.7 percent in October from a year earlier, missing forecasts and reinforcing expectations that the government may have to step up support to avert a sharper economic slowdown.
“Despite the weak economic data, the market looks to have finally moved out from 180-190 yen zone and now try to settle at the 200 yen level, helped by reduced inventories in China and Japan,” the dealer said.
The most-active rubber contract on the Shanghai futures exchange for January delivery rose 70 yuan to finish at 13,045 yuan ($2,129) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for December delivery last traded at 156.1 U.S. cents per kg, up 0.3 cent.
– Reuters
