The Tokyo Commodity Exchange (TOCOM) rubber contract for February delivery finished 2.0 yen, or 0.9%, lower at 210.2 yen (US$1.87) per kg, after rising as far as 217.4 yen earlier in the session. The close was the lowest since Aug. 14.
The most-active rubber contract on the Shanghai futures exchange for January delivery plunged 460 yuan to finish at 14,515 yuan (US$2,201) per tonne. It hit the lowest since July 26 of 14,440 yuan earlier in the session, reversing from an overnight gain.
“The TOCOM was dragged down by a continued Shanghai slide,” said Hiroyuki Kikukawa, general manager of research at Nissan, adding a weaker yen could not offset selling pressure.
The dollar rose to a two-month high against the yen after a hawkish-sounding Federal Reserve heightened expectations for an interest rate hike in December.
A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
“It doesn’t look that Shanghai market has hit a bottom yet and it may test the next support of 14,000 yuan mark,” Kikukawa said, adding that TOCOM may fall to as low as 210 yen.
The front-month rubber contract on Singapore’s SICOM exchange for October delivery last traded at 150.7 US cents per kg, down 4.1 cents.
(US$1 = 112.4500 yen)
(US$1 = 6.5945 Chinese yuan)
Source: globalrubbermarket (21/09/2017)