Tokyo rubber futures advanced more than 1 percent on Thursday as a rebound in oil and firmness in other commodities prices fuelled short-covering, with lingering concerns over tight physical supplies giving additional support. Asian physical rubber prices have been supported as rain in Thailand and Malaysia has heightened speculation that tapping will be affected.
Traders were also concerned about production in Indonesia as the wintering dry season is set to hit the country. As of 0033 GMT, the key Tokyo Commodity Exchange rubber contract for January delivery was trading at 312.6 yen per kg, up 3.6 yen or 1.2 percent. The January contract hit an intraday high of 313.1 yen, up 3 percent from a low of 303.1 yen hit on Tuesday.
It climbed through the five-day moving average of 308 yen, but there are several moving average lines, including the 100-day average around 318 yen, blocking the topside. On Wednesday, oil rose $3 a barrel after a US government report showed declines in fuel and crude inventories in the world's top consumer. US crude settled up $2.99 at $116.00 a barrel after demand concerns sent prices down to a three-month low of $112.31 during intraday activity on Tuesday.
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