SINGAPORE: Japanese rubber futures extended losses for a second straight session on Tuesday, tracking Shanghai lower as traders remained unconvinced by China’s stimulus proposal.
Osaka Exchange’s rubber contract for November delivery finished 1.7 yen, or 0.8%, lower at 208.5 yen ($1.47) per kg. The rubber contract on the Shanghai futures exchange for September delivery fell 80 yuan to finish at 12,055 yuan ($1,681.10) per metric ton. Japan’s benchmark Nikkei average closed up 0.06%.
“The market is in anticipation, maintaining bearish pressure for the time being on the lack of a clear roadmap for China’s stimulus measures,” said a Singapore-based trader.
China’s cabinet met last Friday to discuss measures to spur growth in the economy, state media reported, pledging to roll out policy steps in a timely way amid signs that a post-COVID recovery is fading.
The world’s second-largest economy cut two key benchmark lending rates for the first time in 10 months on Tuesday, following the lowering of short- and medium-term policy rates last week. Japan’s financial regulator has sounded out top domestic banks about China risks and whether they have plans in place if Sino-Western tensions escalate, according to multiple sources with direct knowledge of the matter.
US Federal Reserve Chair Jerome Powell is scheduled to deliver congressional testimony on Wednesday and Thursday.
Asia’s dealmakers are counting on a pause in rate hikes globally and an economic rebound in China to rekindle activity in the region’s equity capital markets, after volumes in the first half of the year sank to their lowest in four years. The front-month rubber contract on Singapore Exchange’s SICOM platform for July delivery last traded at 132.8 US cents per kg, down 0.3%.
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