TOKYO, Oct 21 (Reuters) – Tokyo rubber futures hit a fresh one-year high on Wednesday then slipped as a retreat in oil and other commodities prices put a brake on the speculative buying that had driven rubber up.
* The key Tokyo Commodity Exchange rubber contract for March delivery <0#JRU:> fell 1 yen or 0.4 percent to 225.2 yen per kg from the previous settlement. The contract traded in a very narrow 4-yen range after hitting a fresh one-year high of 227.3 yen earlier in the day.
* U.S. crude futures dropped below $79 a barrel on Wednesday, extending the previous session’s losses away from a one-year peak after a bigger-than-expected rise in U.S. crude oil inventories. [O/R]
* “Sentiment is quite firm as there are buyers out there, while supplies remain tight,” said a senior trader at a Japanese trading firm.
* “Japanese and European tyre makers are trying to catch up on their buying as they had been refraining from buying. They are buying just the amount needed, but given the supply side situation, it helps firm the market,” he said.
* Traders said the physical rubber market remained supported by prolonged supply tightness, with the world’s No. 2 rubber producer, Indonesia, still in the wintering season, when latex output falls.
* Frequent rain in Thailand and parts of Malaysia, the No. 1 and No. 3 producer respectively, also led to less supplies.
* The dollar edged lower against the euro and higher-yielding currencies on Wednesday as a brief recovery from a 14-month low versus a currency basket fizzled out, helped by equity market gains that encouraged risk-taking. [USD/]
* Against the yen, the dollar eased 0.1 percent to 90.67 yen . A higher yen deflates yen-priced rubber futures and dampens sentiment.
* U.S. stocks retreated from 12-month highs on Tuesday as disappointing housing and inflation data prompted investors to book recent gains despite strong results from bellwethers including Apple and Caterpillar. [.N]

Source: Reuters

[Dow Jones] Tocom RSS3 rubber futures settle lower after moving both ways in choppy trade. “The market is trying to consolidate above Y225/kg and occasionally there is strategic liquidation to take profits,” says exporter in Singapore; adds near-term outlook bullish. Since supply is tight, market may even test Y230/kg soon but will first ease before next round of buying, says Thailand-based broker. Benchmark Tocom March rubber contract settles Y0.8 lower at Y225.4/kg after reaching intraday low of Y223.4/kg.

Source: Dow Jones

Oct. 20 (Bloomberg) — Rubber rose to the highest level in a year as a rally in equities boosted investor confidence that the global economic recovery will raise demand for raw materials.

Prices in Tokyo climbed as much as 3.5 percent to 226.5 yen a kilogram ($2,512 a metric ton), the highest level since Oct. 7, 2008. Futures also gained as oil’s advance to a one-year high boosted the appeal of natural rubber as an alternative to synthetic products made from petroleum.

“The bull run in global stocks increased investor appetite for risk assets, leading to their purchases of commodities,” Hisaaki Tasaka, analyst at broker ACE Koeki Co., said by phone. “Stronger oil is also positive for the price of rubber.”

March-delivery rubber rose 3.4 percent to settle at 226.2 yen on the Tokyo Commodity Exchange. It was the biggest daily increase since Oct. 7.

Prices gained 66 percent this year amid speculation that economic recovery will help boost car sales, leading to an increase in demand for the commodity used in tires.

Asian stocks rose, driving the MSCI Asia Pacific Index to the highest level in more than a year, as earnings reports boosted confidence in the global recovery.

The index added 1.1 percent to 121.73 and is set for the highest close since Sept. 8, 2008. It has surged 72 percent from a five-year low on March 9 on signs the global economy is rebounding from the worst slowdown since World War II.

Crude Oil

Crude oil traded near a one-year high in New York after rising the past eight days on optimism that demand will increase. Rubber futures often move in the same direction as oil as competing synthetic products are made from naphtha, distilled from petroleum.

Crude oil for November delivery gained 0.3 percent to $79.85 a barrel as of 3:45 p.m. Tokyo time in electronic trading on the New York Mercantile Exchange.

January-delivery rubber on the Shanghai Futures Exchange gained 1 percent to 19,210 yuan ($2,814) a ton at 2:46 p.m. local time.

Still, gains in the futures were curbed by concern that an increase in stockpiles in China to a five-year high may reflect slowing demand in the world’s largest consumer, Tasaka said.

Rubber inventories increased 4,404 tons in the week ended Oct. 15 to 105,157 tons, the most since November, 2004, the Shanghai exchange said last week.

Source: Bloomberg

TOKYO, Oct 19 (Reuters) – Tokyo rubber futures rose more than 2 percent on Monday, bouncing back towards 220 yen per kg on speculative buying as a rally in equity markets inspired optimism about demand from China, the world’s biggest rubber consumer.
* Oil’s rise to a 12-month high above $79 a barrel before trading at $78.54 also fuelled buying. [O/R] U.S. corporate earnings results, a gauge of the strength of the world’s biggest economy, could again be a key driver of oil prices this week.
* The key Tokyo Commodity Exchange rubber contract for March delivery <0#JRU:> was at 218.4 per kg at 0634 GMT, up 5.6 yen or 2.6 percent from the previous session.
* The benchmark earlier rose as high as 219.5 yen, just below a one-year high of 219.6 yen marked on Oct. 14.
* “The market turned bullish on a jump in Chinese stocks. That fuelled optimism the economy there is in good shape,” said a manager at a Japanese commodity brokerage.
* China and Hong Kong stocks rose on Monday on optimism Beijing is on track to meet the government’s economic growth target. [ID:nHKG223217]
* China’s gross domestic product grew more than 7 percent in the first nine months, a senior official from the National Development and Reform Commission said on Monday. [ID:nBJC002361]
* “People looking at technicals and those who are afraid of inflation against the backdrop of a rally in oil prices are betting that the next target of 230 yen (for the Tokyo rubber market) could be well in sight,” the manager said.
“But I don’t think that’s an easy target in light of sporadic demand in the physical market currently,” unless an unexpected supply shortage is caused by unfavourable weather in producing countries, the manager said.
* The yen held near three-week lows against the dollar on expectations Japanese investors will short the yen as they step up buying of higher-yielding foreign bonds. [USD/]
* Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 4 percent in the week ended Thursday, the exchange said on Friday.

Source: Reuters

[Dow Jones] Tocom rubber futures settle mostly higher, tracking strength in crude oil prices, though benchmark March contract off earlier highs, having again failed to breach key Y220/kg level. Outlook firm, however, with crude, tight supply likely to keep prices underpinned in near term–though market now likely to consolidate in Y212-Y219 range before pushing higher, participants say. Benchmark March RSS3 contract settles Y6 higher at Y218.8/kg having risen to Y219.5/kg earlier. (ANJ)

Source: Dow Jones