Tokyo rubber futures rose about 1 percent to finish above 302 yen on Monday on gains in oil and gold, bouncing back from a three-month low hit late last week. The key Tokyo Commodity Exchange rubber contract for January delivery finished at 302.7 yen, up 2.2 yen or 0.7 percent, after hitting an intra-day high of 305.4 yen. The day's trough was 300.5 yen.
Traders this week are watching to see if the benchmark contract falls back below the psychologically significant 300 yen line, which last happened on May 2. The outlook remains fragile as TOCOM rubber's rise was seen as a technical swing on the strength in crude oil and gold.
"Most of the rise lacks bullish factors distinctive to the rubber market itself," a Tokyo-based trader said. He said TOCOM rubber could dip to a low of about 285 yen if 300 yen is breached. The dollar was down 0.25 percent at 110.22 yen.
US light crude briefly rose over $1 to near $115 a barrel as investors studied the potential supply threats Tropical storm Fay poses to oil and gas production from the Gulf of Mexico. It was hovering below $114 yen at 0855 GMT. Output of natural rubber in Malaysia, one of the world's leading producers, rose 5.6 percent from a month earlier to 88,449 tonnes in June, the state-run Malaysian Rubber Board said on Monday.
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