[Dow Jones] Physical prices of Thai USS3 rubber slightly higher at THB85.59-THB85.95 vs THB85.35-THB85.83 Friday due to strong demand, traders say. “Even though supplies have increased after rains receded earlier this month, strong demand is keeping prices high,” says trader in Hat Yai. Total sales in three central markets of Thailand 183 tons vs 171 tons Friday: 35 tons in Hat Yai, 78 tons in Surat Thani, 70 tons in Chandee. Total sales above 150 tons on most days for past week due to more arrivals amid less rain. (SAM)

Source: Dow Jones

TOKYO, Dec 28 (Reuters) – Key Tokyo rubber futures rose for the third straight session on Monday, helped by a weaker yen and steady oil prices.
* The key Tokyo Commodity Exchange rubber contract for June delivery <0#JRU:> was up 0.3 yen at 276.6 yen per kg in late trade after rising as high as 278.6 yen.
* The contract hit an intraday high of 278.9 yen on Friday, the highest for any benchmark since September 2008.
* Oil reached a four-week high above $78 per barrel on Monday, extending gains into a fourth day, buoyed by signs of an economic recovery in the United States and large declines in U.S. crude inventories. [O/R]
* The dollar held near recent highs against the yen on Monday, helped by demand from Japanese corporates before the year-end. The dollar was up 0.4 percent at 91.50 yen , staying near a two-month high of 91.88 yen set last week.
* A weaker yen inflates yen-priced TOCOM futures and supports market sentiment.
* Japan’s Nikkei average <.N225> hit its highest close in four months on Monday as stronger-than-forecast output data boosted manufacturers. [.T]
* Japan’s industrial output rose for the ninth consecutive month in November, the longest streak of gains in more than 12 years. [ID:nTOE5BR03J] But economists doubt this momentum can continue as inventories are piling up and falling wages could offset Japan’s stimulus measures.

Source: Reuters

BANGKOK, Dec 25 (Reuters) – Tokyo rubber futures closed on
Friday at near 15-month highs supported by firm oil prices,
dealers said.
* The benchmark rubber contract on the Tokyo Commodity
Exchange <0#JRU:> ended 1.4 yen higher at 276.3 ($3.02) yen/kg
after rising earlier to an intra-day high 278.9, the highest
since September 2008.
* Oil rose nearly 2 percent to top $78 a barrel for the first
time in three weeks on Thursday, buoyed by economic optimism that
sent Wall Street to a 2009 high. At 0717 GMT, U.S. crude
was at $77.75 a barrel.
* Higher oil prices usually make an alternative petrochemical
synthetic rubber expensive and encourages the use of natural
rubber.
* TOCOM sentiment has improved after prices topped 270 yen
last week, but the rise has also made it susceptible to
profit-taking, dealers said.
* TOCOM prices were expected to rise higher next week, with
280 yen seen as a key resistance, dealers said.
($1=91.51 Yen)

Source: Reuters

Dec. 25 (Bloomberg) — The dollar fell, poised to end three weeks of gains, on speculation the Federal Reserve will maintain stimulus measures to secure the U.S. recovery. Japanese stocks dropped the most in two weeks, while copper and rubber climbed to 15-month highs.

The greenback fell against 11 of its 16 most-traded counterparts before reports next week forecast to show a slide in U.S. business activity and a rebound in initial jobless claims. Makers of electronics and cars led a 0.4 percent drop in Japan’s Nikkei 225 Stock Average on concern recent gains made shares expensive relative to earnings. Copper and rubber advanced on optimism that the global economic recovery will boost demand for materials.

“Speculation about an early exit from credit easing in the U.S. may weaken if incoming data confirm a patchy recovery,” said Keiji Matsumoto, a currency strategist in Tokyo at Nikko Cordial Securities Inc.

The dollar was at $1.4383 per euro at 3:25 p.m. in Tokyo from $1.4380 yesterday in New York. It appreciated to $1.4218 on Dec. 22, the strongest level since Sept. 4. The greenback slipped 0.1 percent to 91.43 yen and 0.2 percent 88.44 cents to the Australian dollar. The Japanese currency climbed 0.1 percent to 131.46 per euro.

Japan and China were the only major markets open today, the rest being shut for the Christmas holiday. The number of shares traded on the Tokyo Stock Exchange was the lowest for a full day this year. The MSCI Asia Pacific Index of regional shares dipped 0.1 percent.

Jobless Claims

The Institute for Supply Management-Chicago Inc. will report on Dec. 30 its barometer of U.S. business activity fell to 55.1 in December from 56.1 the previous month, according to a Bloomberg News survey of economists. Readings above 50 signal expansion.

The number of Americans filing claims for unemployment benefits in the week ending 27 probably rose to 460,000 after dropping to 452,000 in the previous week, the lowest level since September 2008, according to a separate survey ahead of the release of the data on Dec. 31.

Fed Bank of St. Louis President James Bullard said he sees interest rates remaining near zero in 2010 as the central bank tries to keep the recovery on track, the Wall Street Journal reported this week.

‘Tap Excess Dollars’

“Unless we see a more clear picture about the withdrawal of dollars by the Fed, there is a good chance of investors tapping excess dollars again and resuming investments on higher- yielding currencies,” said Yuichiro Harada, senior vice president of the foreign-exchange division at Mizuho Corporate Bank Ltd., a unit of Japan’s second-largest lender.

Canon Inc., which is the world’s largest camera maker and surged 8 percent in the past two days, lost 1.7 percent. Toyota Motor Corp., the world’s biggest carmaker, retreated 1 percent following a two-day, 4.6 percent advance.

The Nikkei 225 added 3.5 percent this week while Japan’s broader Topix index gained 1.8 percent, swelling the price of stocks in the gauge to 1.12 times book value on average, the highest level since Sept. 25.

“The market is just taking a breather from the rally,” said Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co., which oversees the equivalent of $94 billion. “People are feeling cautious, and they’re taking profits.”

China Listings

Japan’s core consumer prices excluding fresh food fell 1.7 percent in November from a year ago, the statistics bureau said today. The unemployment rate rose for the first time in four months in November, a separate report showed.

China’s Shanghai Composite Index lost 0.4 percent, paring its first five-day gain in three weeks, on concern new share sales will divert money from existing equities. Zijin Mining Group Co. and China Shenhua Energy Co., the nation’s largest producers of gold and coal, lost at least 1 percent as eight companies debuted in Shenzhen’s ChiNext market for start-up companies.

Copper for March-delivery on the Shanghai Futures Exchange rose as much as 1.1 percent to 57,720 yuan ($8,454) a metric ton, the highest price for a most-active contract since Sept. 4, 2008. It closed at 57,630 yuan.

Rubber Prices

Copper prices gained as much as 2.4 percent yesterday in London as the Standard & Poor’s 500 Index rose to a 15-month high after initial jobless claims in the U.S. fell more than forecast and orders for durable goods excluding transportation topped economists’ estimates.

“Rising U.S. equities and a falling dollar increased risk appetite, spurred more buying,” Wang Lei, an analyst at Haitong Futures Co. said today by phone from Shanghai.

Natural rubber for June delivery climbed as much as 1.5 percent to as high as 278.9 yen per kilogram ($3,050) a ton on the Tokyo Commodity Exchange and closed at 276.3 yen.

“Rising crude oil price and a weakening yen continue to drive rubber prices higher,” Rewat Yenchai, an analyst at AGROW Enterprise Ltd., said by phone from Bangkok today.

Crude oil for February delivery rose 1.8 percent yesterday to $78.05 a barrel on the New York Mercantile Exchange, the highest settlement since price since Dec. 1. Oil is up 75 percent this year and is heading for the biggest annual gain in a decade.

Source: Bloomberg

Singapore – Tocom RSS3 rubber futures settle higher following strong buying as investors take leads from rise in crude, funds roll over positions to next month. “Bullish crude oil is supporting rubber prices today,” says Singapore-based analyst. Rolling over of contracts by funds yet to pick up momentum but few hundred lots moved to June from May contract by funds, says broker in Tokyo. Nymex light, sweet crude for February delivery traded above USD77/bbl during Asian trading hours. Benchmark Tocom June contract settles Y5.1 higher at Y274.9/kg after reaching intraday high of Y275.7, level not seen since September 2008.

Source: Moneycontrol.com