Tokyo rubber futures tumbled on Monday, pressured by weak stock prices and demand worries, but prices managed to stay above 130 yen and trade within recent ranges. Rubber on the Tokyo Commodity Exchange has mostly traded in a tight band on both sides of 140 yen since the beginning of the year, trapped by demand worries and concerns producers might step in to support prices.
"In the absence of fresh news, technical factors are behind the moves in rubber," a Tokyo-based trader said. The key Tokyo Commodity Exchange rubber contract for August delivery fell about 7 percent to a morning trough of 130.4 yen per kg, matching the two-month low marked on February 19. The benchmark contract closed the morning at 136.2 yen, down 4.0 yen.
Japan's Nikkei stock average slid 3.2 percent on Monday, with Mitsubishi UFJ Financial Group and other banks sinking on fears about their US peers, while exporters fell on worry about the US economy. Oil prices fell below $44 per barrel on Monday, extending losses from the previous session amid fears that the ailing global economy would further damage energy demand.
Rubber inventories in warehouses monitored by the Shanghai Futures exchange fell 3 percent in the week ended Thursday, the exchange said on Friday. The European unit of US carmaker General Motors said it planned to spin off its German arm Opel and needed 3.3 billion euros ($4.2 billion) in state aid to avert job cuts and site closures.
PHYSICAL RUBBER PRICES Asian physical rubber prices were steady to slightly lower on Monday, supported during the wintering dry season when latex output falls. Prompt supplies were relatively ample for rubber from the southern part of Indonesia, the world's second-largest producer, which was the reason for the cheaper price compared to Thai rubber grades, a local trader said.
Comments
Comments are closed.