TOCOM extends gains into 3rd day on bargain-hunting

TOKYO: Benchmark Tokyo rubber futures extended gains into a third session on Thursday as investors continued to look for bargains and speculators unwound short positions, dealers said.

The Tokyo Commodity Exchange (TOCOM) rubber contract for December delivery  finished 1.4 yen, or 0.8 percent, higher at 175.2 yen ($1.59) per kg.

"Speculators who have built up short positions over the past month were rapidly unwinding their positions," a Tokyo-based dealer said, adding Wednesday's rally in oil prices also boosted risk appetite among investors.

The TOCOM futures, which set the tone for rubber prices in Southeast Asia, have lost about 15 percent from May's high by early this week.

Oil prices steadied on Thursday, with U.S. crude pulling back from 3-1/2-year highs, but supply remained tight with investors concerned about the prospect of a big fall in crude exports from Iran due to U.S. sanctions.

"I expect the TOCOM to recover at around 185 yen level as the market has been oversold recently," the dealer said.

The most-active rubber contract on the Shanghai futures exchange for September delivery fell 25 yuan to finish at 10,455 yuan ($1,578) per tonne.

The front-month rubber contract on Singapore's SICOM exchange for July delivery last traded at 138.5 U.S. cents per kg, down 0.5 cent.