SINGAPORE: Japanese rubber futures posted their second straight weekly gain, even as the benchmark closed lower on Friday, weighed down by weak demand in key buyer China.
The Osaka Exchange’s rubber contract for November delivery finished 0.9 yen, or 0.4%, lower at 212.0 yen ($1.52) per kg. The benchmark contract rose 1% for the week amid expectations of further stimulus in China.
The rubber contract on the Shanghai futures exchange for September delivery fell 30 yuan to finish at 12,060 yuan ($1,693.08) per tonne. Japan’s benchmark Nikkei average closed up 1.97%. This week was largely technical-driven and will remain so until China demand changes, said Farah Miller, CEO of Helixtap Technologies, an independent rubber-focused data company.
The midweek rise was a correction after being oversold, narrowing the difference between physical and futures prices, said Miller.
China’s factory gate prices fell at the fastest pace in seven years in May and quicker than forecasts, as faltering demand weighed on a slowing manufacturing sector and cast a cloud over the fragile economic recovery.
China’s commerce ministry announced on Thursday an automobile purchase promotion campaign that will last from June to December.
The announcement came shortly after data showed passenger vehicle sales in China rose 7.3% in May from April, higher on the month but far from the robust recovery policymakers were hoping for.
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