Benchmark Tokyo rubber futures dropped to a 1-week low on Thursday, retreating from a near 13-month high, as a sharp fall in Shanghai futures and the yen's strength against the dollar led investors to book profits, dealers said. The Tokyo Commodity Exchange (TOCOM) rubber contract for October delivery closed 4.2 yen, or 1.9 percent, lower at 218.9 yen ($1.84) per kg, after sliding to as low as 218.2 yen, the lowest since May 8. "Plunging Shanghai prices and a higher yen prompted profit-taking," said a Tokyo-based dealer who declined to be named.
The most-active rubber contract on the Shanghai futures exchange for September delivery fell 460 yuan, or 3.1 percent, to close at 14,240 yuan ($2,297.14) per tonne. The front-month rubber contract on Singapore's SICOM exchange for June delivery last traded at 150.0 US cents per kg, down 2.5 cent.
Adding to pressure, the dollar languished near a three-month low against a basket of major currencies on Thursday after surprisingly soft retail sales prompted some investors to wonder if the Federal Reserve can afford to hike interest rates at all this year. The dollar was quoted at 118.98 yen in late Asia trade, against 119.14 yen the previous day. "The benchmark has broken through this year's high earlier this week, but the market apparently has run out of steam," the dealer said, adding the price may head to 210-215 yen as investors adjust their positions. The TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, have recovered about 15 percent since the recent lows in April to hit a 13-month high early this week.
Comments
Comments are closed.