SINGAPORE: Japanese rubber futures fell on Wednesday, as concerns over a global economic slowdown weighed on sentiment, despite stronger Shanghai prices following market correction from recent lows. Osaka Exchange’s rubber contract for April delivery finished 2.3 yen, or 1.1%, lower at 212.6 yen ($1.44) per kg. The rubber contract on the Shanghai futures exchange for January delivery rose 225 yuan to finish at 12,205 yuan ($1,678) per tonne. Japan’s benchmark Nikkei share average closed down 0.06%.
“The upwards movement of SHFE prices is likely speculative as there is a greater buying up of futures, whereas OSE prices reflect a greater buying up of physical products at the moment,” said a Singapore-based trader.
“Although the weather in Thailand has settled, demand seems to be down for the time being, and could explain why OSE prices face downward pressure - though this could change if SHFE prices continue to climb,” he added.
Chinese electric vehicle (EV) maker Nio said on Wednesday it has suspended production due to Covid-19 curbs as rising cases across the country cause more disruptions to business activity, triggering a steep drop in its shares.
Toyota Motor Corp on Tuesday posted a worse-than-expected 25% drop in quarterly profit and cut its annual output target, as the Japanese firm battles surging material costs and a persistent semiconductor shortage. Asian shares climbed on Wednesday, led by Chinese stocks on reopening hopes, while the dollar sagged as investors braced for the US Federal Reserve’s policy decision later in the day, with many hoping for signs of a slowdown in future rate hikes.
The front-month rubber contract on Singapore Exchange’s SICOM platform for December delivery last traded at 121.4 US cents per kg, up 1.2%.
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