Key Tokyo rubber futures recouped earlier losses on Wednesday as oil prices rebounded, to end the year up about 103 percent. The key Tokyo Commodity Exchange rubber contract for June delivery rose 1.5 yen or 0.5 percent to 276.2 yen per kg for a preliminary settlement. The exchange will not have an evening session and will resume full trading on January 4.
The contract hit an intraday peak of 278.9 yen on Friday, the highest for any benchmark since September 2008. Key rubber futures recovered strongly from 2008 lows hit last December when financial markets were hit by renewed concerns about the economy and financial stability.
But current levels, while slightly more than double the level from a year earlier, were still about 77 percent of the peak of around 357 yen hit in early 2008, when commodities across the board surged on expectations of strong demand from emerging countries such as China and India.
Traders remained cautious about the prospects for the global economy and demand for rubber. Oil pared earlier losses and rose above $79 a barrel on Wednesday after prices edged up the day before on cold weather in the United States and expectations that weekly data will show another fall in US inventories.
The dollar held gains on Wednesday after rising against most major currencies the day before, climbing to a two-month high versus the yen, boosted by a report showing a rise in US consumer confidence this month. The dollar kept the firmer tone it has developed recently on shifting sentiment about the outlook for US rates.
Japanese manufacturing activity rose for the first time in three months in December, a survey showed on Wednesday, suggesting growth in production will continue due to demand from other Asian countries. Japan's Nikkei average booked a 19 percent gain for 2009, with shares of high-tech exporters having led a rebound rally on a weaker yen and as economic stimulus measures helped turn around the world economy.
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