SINGAPORE: Japanese rubber futures rose slightly on Friday, but were set for their first weekly drop in five as traders reassessed demand prospects in top buyer China following the week-long Lunar New Year break.

The Osaka Exchange rubber contract for July delivery was up 0.7 yen, or 0.3%, at 226.3 yen ($1.76) per kg, as of 0219 GMT, after five straight sessions of losses.

For the week, the benchmark OSE contract has lost about 3.9%. The rubber contract on the Shanghai futures exchange for May delivery was down 215 yuan, or 1.7%, at 12,645 yuan ($1,875) per tonne. Japan’s benchmark Nikkei share average opened up 0.19%.

Earlier this week, data showed Asia’s factory activity contracted in January as the boost from China’s COVID reopening had yet to offset headwinds from slowing US and European growth, underscoring the fragility of the region’s economic recovery.

Rubber markets are waiting for signs of a demand pick-up in top buyer China following the week-long Lunar New Year holiday, and after the country lifted its strict COVID-19 curbs at the end of 2022.

Asian shares turned lower and the dollar regained some posture on Friday, as disappointing earnings from US tech giants undermined sentiment, adding to caution ahead of the high-stakes US non-farm payrolls data.

The front-month rubber contract on Singapore Exchange’s SICOM platform for March delivery last traded at 139.9 US cents per kg, down 1.3%.