SINGAPORE: Japanese rubber futures snapped a 10-session winning streak on Tuesday, tracking weakness in the Shanghai market and as top auto manufacturer Toyota Motor suspended operations at all 14 of its assembly plants in Japan.
The Osaka Exchange’s rubber contract for February delivery finished 2.4 yen, or 1.1%, lower at 212.2 yen ($1.45) per kg.
The rubber contract on the Shanghai futures exchange for January delivery fell 95 yuan to 13,180 yuan ($1,807.76) per metric ton. Japan’s benchmark Nikkei average closed up 0.18%.
Toyota Motor suspended 12 plants in its home market from Tuesday morning and added the final two from the afternoon due to a system failure, a company spokesperson said. The yen firmed 0.08% against the dollar, but hovered near a nine-month low hit on Friday. A weaker yen makes assets denominated by the currency more affordable for overseas buyers.
China’s factory activity likely contracted for a fifth straight month in August, a Reuters poll showed, as weak demand threatens recovery prospects and pressures officials to prop up growth.
The rubber market saw some profit-taking, but overall support seemed there from a stronger yuan-fixing and improved US-China relations, said a Singapore-based trader.
In top rubber exporter Thailand, the Meteorological Department warned of heavy rains that could lead to flash floods in several regions, including the primary rubber-producing South, between Aug. 29 and Sept. 3.
China stocks led Asian shares higher with investors welcoming Beijing’s efforts at supporting markets, while bonds rallied and the dollar dipped on possibly softening US data.
The front-month rubber contract on Singapore Exchange’s SICOM platform for September delivery last traded at 134.8 US cents per kg, up 0.3%.
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