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Jan. 4 (Bloomberg) — Rubber advanced to a 15-month high on investors’ optimism that a global economic recovery may accelerate this year, leading to growth in demand for the commodity used in tires.
Futures in Tokyo gained as much as 3.3 percent to the highest level since Sept. 26, 2008. Businesses in China, the world’s largest rubber consumer, continued to expand last month as a purchasing managers’ index climbed to 56.1 from 55.7 in November, HSBC Holdings Plc and Markit Economics said today. Reports this week are forecast to show U.S. manufacturing continued to expand and factory bookings increased.
“Investors bought raw materials on speculation that economic growth may pick up,” Takaki Shigemoto, an analyst at research and investment company JSC Corp. in Tokyo, said today by phone. “Rubber demand will likely expand, led by rising car sales and production in China.”
Rubber for June delivery climbed as much as 9 yen to 285 yen per kilogram ($3,065 a metric ton) on the Tokyo Commodity Exchange before settling at 284 yen. Prices more than doubled last year, the best performance since at least 1976, according to Bloomberg data.
Raw materials may return more than financial assets this year for the first time in three years as the global economy rebounds, according to Bloomberg surveys and 2009’s most accurate commodity forecasters.
The S&P GSCI Enhanced Total Return Index of 24 commodities will gain 17.5 percent, Goldman Sachs Group Inc. estimates. That’ll beat the 11 percent jump in the Standard & Poor’s 500 Index and the 2.8 percent return on the benchmark U.S. 10-year note, forecasts compiled by Bloomberg show.
Yen Weakens
Rubber futures also increased as Japan’s currency traded near a four-month low against the dollar, raising the appeal of yen-denominated contracts.
The yen was at 93 per dollar at 3:48 p.m. in Tokyo from 93.02 in New York on Dec. 31, when it touched 93.15, the lowest level since Sept. 7. The dollar rose on signs the U.S. recovery is strengthening.
The U.S. Institute for Supply Management will report today its factory index expanded for a fifth month, rising in December to 54, according to a Bloomberg News survey. The gauge has surpassed the breakeven level of 50 since August.
A separate report from the Commerce Department tomorrow will show factory bookings increased 0.5 percent in November after rising 0.6 percent the previous month, according to economists surveyed.
Shanghai Gains
Rubber for May delivery on the Shanghai Futures Exchange added 0.9 percent to settle at 24,585 yuan ($3,587) a ton.
Natural rubber stockpiles monitored by the Shanghai exchange rose 2,855 tons to 144,548 tons, the bourse said on Dec. 31. It was the highest level since November 2004.
Car sales in China climbed 98 percent to 1.04 million units in November, the nation’s automobile manufacturers’ association said Dec. 10. Japan’s vehicle sales may rise 4.1 percent to 4.8 million vehicles in 2010 as the government extends subsidies to boost demand, an auto industry group said Dec. 24.
In the cash market, shippers in Thailand, the world’s largest producer and exporter, offered so-called RSS-3 grade rubber for February shipment at $2.88 a kilogram today, little changed from Dec. 30, Shigemoto at JSC said.
Source: Bloomberg