TOKYO: Japanese rubber futures rose on Tuesday, underpinned by concerns over tighter domestic supply amid relatively low inventories, while a rebound in the Shanghai market and a weaker yen also lent support.
The Osaka Exchange (OSE) rubber contract for November delivery finished 8.7 yen higher at 325.9 yen ($2.3) per kg. It was up 2.4% from the October contract’s closing price on Monday, which had served as the benchmark until then.
The rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery rose 125 yuan to settle at 14,495 yuan ($2,015) per metric ton.
“Monday’s delivery exceeded expectations in the last trading session of May contract, prompting buying on the view that inventories in Japan would be tight,” a Tokyo-based dealer said, adding that some traders also covered short positions.
The OSE’s May contract expired on Monday at 323.0 yen per kg, with deliveries at 222 lots, according to the exchange’s data.
Japanese rubber futures log fourth straight weekly gain on worsening weather
China’s industrial profits picked up pace in April, official data showed on Tuesday, giving policymakers cause for optimism that recent stimulus efforts are helping to keep the economy afloat despite trade tensions with the United States.
The yen traded at 143.91 against the U.S. dollar, compared with around 142.51 in Monday afternoon trade in Asia. A weaker currency makes yen-denominated assets more affordable to overseas buyers.
Japan’s Nikkei reversed early declines to end higher on Tuesday, as a weaker yen and falling yields on super long-dated bonds lifted sentiment.
Thailand’s meteorological agency warned of heavy rain and accumulation that may cause flash floods during May 26-27.
Tesla’s sales in Europe fell 49% in April from a year earlier, even though battery-electric car sales rose 27.8%, as the U.S. EV maker’s upgrade of its Model Y shows little sign of reviving the brand’s fortunes in the region.
The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 170.1 U.S. cents per kg, up 0.5%.
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