Benchmark Tokyo rubber futures gave up early gains to end flat on Monday, pressured by weaker oil prices and sell-offs in the nearest-month contract, while trading was thin as Chinese markets were closed for a national holiday. Oil prices dipped as a relentless rise in US drilling undermined an Opec-led push to tighten supply.
The Tokyo Commodity Exchange (TOCOM) rubber contract for November delivery finished unchanged at 213.0 yen ($1.91) per kg, after rising as high as 217.1 yen earlier in the session. It touched its lowest since May 11 at 210.2 yen in evening trade on Friday, which is counted as part of Monday trade. "Plunging price of the June contract apparently weighed on the benchmark in late trade," said Toshitaka Tazawa, an analyst with Fujitomi Co.
The TOCOM contract for June delivery fell 12.1 yen to close at 262.9 yen per kg. "Some investors were unwinding their positions for the June contract after supply concerns boosted its price recently," Tazawa said. Rubber inventories at TOCOM warehouses as of May 10 stood at 1,430 tonnes, up from 1,247 tonnes on April 30, but still down 83 percent from a year earlier, according to the exchange's latest report. The front-month rubber contract on Singapore's SICOM exchange for June delivery last traded at 151.0 US cents per kg, down 2.0 cents. Chinese markets will remain closed on Tuesday for a public holiday.
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