OKYO, Jan 15 (Reuters) – Benchmark Tokyo rubber futures edged up from a one-month low on Thursday as investors covered short positions after a rebound in oil prices the previous day and the yen’s fall against the U.S. dollar, dealers said.
The Tokyo Commodity Exchange rubber contract for June delivery finished 1.1 yen higher at 196.2 yen ($2) per kg.
The upturn in oil prices overnight prompted short-coverings in early trade as slumping oil prices had been putting pressure on commodities as a whole,” a Tokyo-based dealer said.
World oil prices had their biggest surge in 2-1/2 years on Wednesday, rebounding from a nearly six-year low as traders turned away from the bearish pressures of a worldwide glut to cover themselves on expiring options. But it slid again on Thursday.
The weaker yen also lent support to investor sentiment. The U.S. dollar edged up in Asian trade on Thursday, regaining some ground lost overnight after a surprisingly big fall in U.S. retail sales.
The greenback added about 0.2 percent to 117.59 yen , after skidding as low as 116.07 yen on Wednesday, a level last seen on Dec. 16.
“There is no other strong fundamental reason to buy rubber now as the global economy is slowing. Rubber prices will be sensitive to oil prices for a while,” the dealer said.
The most-active rubber contract on the Shanghai futures exchange for May delivery finished unchanged at 12,625 yuan ($2,039) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for February delivery last traded at 138.1 U.S. cents per kg, down 1.7 cent.
($1 = 6.1910 Chinese yuan renminbi)
($1 = 117.6700 yen)
(Reporting by Yuka Obayashi; Editing by Anupama Dwivedi)
Source: Reuters
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