SINGAPORE: Japanese rubber futures edged lower on Monday, tracking weaker domestic equities, as fears of a global economic slowdown continue to weigh on sentiment.

The Osaka Exchange (OSE) rubber contract for October delivery was down 1.5 yen, or 0.7%, at 211.7 yen ($1.57) per kg, as of 0200 GMT.

The OSE was closed from Wednesday to Friday for a series of public holidays in Japan.

The rubber contract on the Shanghai futures exchange (SHFE) for September delivery was up 60 yuan, or 0.5%, at 11,780 yuan ($1,703) per tonne.

Rubber inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.4% from last Friday, the exchange said.

Japan’s benchmark Nikkei average opened 0.21% lower.

The International Monetary Fund on Thursday warned of “uncertainty” around the direction of Japan’s monetary policy, saying a possible shift from ultra-low interest rates could have a significant impact on global financial markets.

Japanese rubber futures rise on weaker yen

Oil prices rose slightly in early Asian trade on Monday as fears of a recession in the United States, which drove prices down for three straight weeks for the first time since November, began to recede.

Higher oil prices disincentivise manufacturers from shifting to synthetic rubber, which is derived from oil, helping the natural rubber market.

Asian shares crept higher on Monday as investors braced for a week where U.S. inflation data will test wagers the next move in interest rates will be down, while worries about a possible credit crunch weighed on the dollar.

The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 136.9 U.S. cents per kg, up 0.7%.