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RUBBER-Tokyo futures dip to 3-week low on weak equities
May 30, 2014 / 9:11 AM / 3 years ago

RUBBER-Tokyo futures dip to 3-week low on weak equities

TOKYO, May 30 (Reuters) - Benchmark Tokyo rubber futures fell to a three-week low on Friday, marking a monthly drop of 3.4 percent and its second straight monthly decline, as weaker stock prices and concerns about economic slowdown in top buyer China hit sentiment.

The benchmark rubber contract on the Tokyo Commodity Exchange (TOCOM) for November delivery dropped 1.8 yen, or 0.9 percent, to settle at 198.6 yen ($1.96) per kg.

The contract fell to as low as 197.4 yen, the lowest since May 9.

“Rubber prices were weighed down by a fall in equity market,” said Hiroyuki Kikukawa, general manager at Nihon Unicom Inc.

Japan’s Nikkei stock average snapped six days of gains on Friday, its longest winning streak since December, as investors pocketed profits before the weekend.

“There was no bullish news to help boost buy interests or to help offset investor worries about the Chinese economy and oversupply,” he said.

Crude rubber inventories at Japanese ports stood at 22,514 tonnes as of May 20, up 2.89 percent from 10 days earlier, data from the Rubber Trade Association of Japan showed on Thursday.

Bridgestone Corp, the world’s largest tyre maker, bought Indonesian rubber this week and few cargoes of Malaysian grade were sold among trading houses, but Thai sellers waited for prices to improve, dealers said on Friday.

A slump in natural rubber prices to multi-year lows is spurring Southeast Asian farmers to turn to other crops and tappers to look for other jobs, potentially chipping away at a chronic supply overhang.

The most-active rubber contract on the Shanghai futures exchange for September delivery fell 345 yuan to finish at 14,125 yuan ($2,300) per tonne.

The front-month rubber contract on Singapore’s SICOM exchange for June delivery last traded at 168.50 U.S. cents per kg, down 2.20 cent. ($1 = 101.5450 Japanese yen) ($1 = 6.2399 Chinese yuan) (Reporting by Yuka Obayashi; Editing by Sunil Nair)

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