TOKYO: Japanese rubber futures edged higher on Thursday as investors turned optimistic the Omicron coronavirus variant might be less severe than feared, while hopes that Japan’s large spending will propel economic recovery lent support.

Osaka Exchange’s rubber contract for June delivery finished 0.4 yen higher at 233.3 yen ($2.0) per kg.

OSE’s December contract expired at 224.6 yen per kg on Wednesday.

Two vaccine manufacturers said their shots offered protection against Omicron, as UK data suggested it may cause proportionally fewer hospitalisations than the Delta coronavirus variant, supporting conclusions were reached in South Africa.

The risk of needing to stay in hospital for patients with the Omicron is 40% to 45% lower than for patients with the Delta variant, according to research by London’s Imperial College published on Wednesday.

Also supporting sentiment, Japan’s government is set to unveil its largest annual budget on Friday with $943 billion in spending for the fiscal year beginning next April, a draft plan seen by Reuters showed.

The rubber contract on the Shanghai futures exchange for May delivery rose 135 yuan to finish at 14,515 yuan ($2,279) per tonne.

The front-month rubber contract on Singapore’s SICOM exchange for January delivery last traded at 170.1 US cents per kg, up 0.7%.