SINGAPORE: Japanese rubber futures inched up on Tuesday after falling for three sessions, helped by hopes that an interest rate cut in China would stimulate the world’s second-largest economy, while Shanghai and crude losses curbed gains.
The Osaka Exchange (OSE) rubber contract for November delivery was up 0.3 yen, or 0.1%, at 210.1 yen ($1.51) per kg as of 0220 GMT.
The rubber contract on the Shanghai futures exchange (SHFE) for September delivery was down 70 yuan, or 0.6%, at 11,885 yuan ($1,658.76) per metric ton.
Japan’s benchmark Nikkei average opened up 0.72%.
To prop up the economy, China’s central bank cut its seven-day reverse repo rate by 10 basis points to 1.90% from 2.00%, when it injected 2 billion yuan ($279.97 million) through the short-term bond instrument.
Still, China and Hong Kong shares had closed roughly flat on Monday as investors braced for fresh data this week, which would likely add to concerns over the Chinese economy.
Likewise, Japan’s wholesale inflation slowed for a fifth consecutive month in May because of sliding fuel and commodity prices, data showed on Monday.
Oil prices inched higher on Tuesday on bargain hunting, recovering some ground from the previous day’s plunge, but gains were limited as investors remained cautious ahead of key policy decisions by the U.S. Federal Reserve and other central banks.
Lower oil prices incentivise manufacturers to shift to synthetic rubber, derived from oil, hindering the natural rubber market.
Asian shares edged up in early trade, following an upbeat session on Wall Street.
The front-month rubber contract on Singapore Exchange’s SICOM platform for July delivery last traded at 131.9 U.S. cents per kg, up 0.1%.
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