Tokyo futures fall, tracking Shanghai loss

TOKYO: Key Tokyo rubber futures plunged on Wednesday as weak Shanghai futures and the yen's strength against the dollar prompted investors to close long positions after recent sharp rallies.

The new benchmark Tokyo Commodity Exchange rubber contract for August delivery, which debuted on Wednesday, settled at 487.3 yen per kg after opening at 493.3 yen.

The previous benchmark for July delivery, which hit a record high of 535.7 yen last week, settled down 9.5 yen or 1.9 percent at 497.2 yen.

The July contract had settled down 3.5 percent on Tuesday at 506.7 yen, posting its biggest daily loss in about a month.

TOCOM rubber futures tumbled on Tuesday as the Shanghai market slid on concerns about demand from China, the world's top rubber consumer, and traders turned to physical prices for clues to the market's trend.

Asian physical rubber prices were unchanged near record high levels on Wednesday even though futures prices on the Tokyo Commodity Exchange fell sharply, as tight supply still supported the physical market, dealers said.

The most active Shanghai rubber futures for May delivery closed on Wednesday at 39,530 yuan ($6,012) per tonne, down 0.4 percent from Tuesday's close of 39,700 yuan. It fell as much as 2 percent earlier in the day. Volume stood at 650,698 lots, down 27 percent from Tuesday's 890,908 lots. The contract hit a record high of 43,500 yuan on Feb. 9.

US crude futures climbed to a 2-1/2-year peak on Wednesday on concern that unrest in Libya could spread to other top oil producers in the region and lead to more cuts in output.

The euro edged higher on Wednesday after European Central Bank officials stressed their readiness to raise interest rates to fight inflation, though it was expected to face resistance near $1.3750.