Tokyo rubber futures inch up

Tokyo rubber futures edged higher on Friday on the back of demand in the physical market, but weaker oil prices capped gains, dealers said. The benchmark rubber contract on the Tokyo Commodity Exchange for December delivery rose 1.5 yen to settle at 263.9 yen ($3.02) per kg. "Technical sentiment improved as there was a good sign from the physical side that demand was rising. However, weaker oil prices were a negative factor," one dealer said.
Dealers said China, the biggest rubber buyer, had started buying again after prices fell to an attractive level. Physical prices were not expected to fall sharply as supply was not rising too quickly because rain in some areas still disrupted tapping. Oil slid for a third day on Friday towards $76 a barrel after disappointing US economic indicators, although a potential Atlantic storm provided some support to prices. TOCOM rubber was expected to be trapped in a narrow range of 260-270 yen per kg next week, with 260 yen seen as a strong support level, dealers said.