SHANGHAI: Japanese rubber futures rose on Tuesday, recouping some of the losses from the previous session, as a rally in Tokyo equities boosted investor sentiment.
The Osaka Exchange (OSE) rubber contract for April delivery was up 4.4 yen, or 1.05 percent, at 423.6 yen (USD2.68) per kg. The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery rose 130 yuan, or 0.7 percent, to 18,800 yuan (USD2,818.51) per metric ton.
The most active December butadiene rubber contract on the SHFE fell 725 yuan, or 4.6 percent, to 15,020 yuan per metric ton. Japan’s Nikkei share average ended nearly 3 percent higher, extending its rebound from a tech-led selloff last week as AI-related stocks surged Improved investor sentiment tends to support rubber futures Sustained oversupply pressure is not yet visible, and prices are unlikely to keep falling, analysts from broker CITIC Securities Futures said in a note.
The analysts said market expectations of El Niño’s impact on rubber production may have been overestimated, potentially reducing concerns about supply tightness. They added that expectations of weaker overseas economies have accelerated the price decline since mid-October.
Top consumer China’s passenger vehicle exports jumped 68.2 percent year-on-year to 932,000 in October, while domestic sales fell 27.3 percent to 1.65 million, a 12th consecutive monthly decline, data from the China Passenger Car Association showed on Monday. Automobile sales could influence the intensity of automobile manufacturing, which involves using rubber-made tyres.
The front-month rubber contract on Singapore Exchange’s SICOM platform for February delivery last traded at 239.6 US cents per kg, up 1 percent as of 0700 GMT.