SINGAPORE: Japanese rubber futures dropped for a second consecutive session on Friday, ahead of the upcoming Lunar New Year holidays, as lacklustre manufacturing and U.S. labour data weighed on sentiment.
The Osaka Exchange (OSE) rubber contract for July delivery closed down 0.9 yen, or 0.32%, at 282.7 yen ($1.93) per kg.
The contract logged a weekly decline of 1.4%, the first week-on-week drop since Dec. 11.
The rubber contract on the Shanghai Futures Exchange (SHFE) for May delivery fell 115 yuan to finish at 13,290 yuan ($1,850.82) per metric ton.
“As China moves in to the Lunar New Year holidays, the market may quieten down from next week and some traders may take profit contributing to the downward movement,” said Farah Miller, CEO of Helixtap Technologies, an independent rubber-focused data company.
Global factories delivered a largely patchy performance at the start of 2024, as new orders spurred momentum in the United States, although soft Chinese demand left Asia’s economies on a shaky footing.
A raft of U.S. economic data showed rising productivity helping to cap labour costs, while an increase in announced layoffs and weekly jobless claims provided further evidence of softening in the labour market.
The struggles of Polestar and other smaller players underscore the massive expense of developing electric vehicles (EV). A global EV-demand slowdown could now weed out weaker players or force a consolidation wave.
Oil prices rose following a decision by OPEC+ to keep its oil output policy unchanged.
Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.
Japan’s benchmark Nikkei average closed 0.41% higher.
The Japanese yen weakened 0.03% to 146.49 against the dollar.
The front-month rubber contract on Singapore Exchange’s SICOM platform for March delivery last traded at 151.00 U.S. cents per kg, down 0.79%.
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