Tokyo rubber futures down 2.4 percent

Tokyo rubber futures dropped 2.4 percent on Monday on weaker oil prices and profit-taking as players liquidated contracts after prices failed to stay firmly above major resistance of 500 yen, but tight supply still lent support, dealers said. The benchmark rubber contract on the Tokyo Commodity Exchange for July delivery fell 12.1 yen, or 2.4 percent, to settle at 490.8 yen ($5.96) per kg.
"The market was overbought and prices have risen too high, so players sold contracts to take profits and avoid risk after prices failed to stay above the 500 yen level," one dealer said. The benchmark Thai RSS3 was still offered at the record high of $6.10 per kg, the highest ever, although TOCOM prices fell, reflecting strong demand amid tight supply.