TOKYO: Benchmark Tokyo rubber futures rose to a 2-week high on Wednesday, following a mid-day gain in Shanghai futures, but trade was lacklustre and further gains were capped on profit-taking, dealers said.
Tokyo Commodity Exchange (TOCOM) futures, which set the tone for tyre rubber prices in Southeast Asia, started on a weak note in early trade, but a sudden gain in mid-day trade in Shanghai prompted fresh buys, said Jiong Gu, analyst at Yutaka Shoji Co.
The TOCOM rubber contract for July delivery finished 1.2 yen higher at 202.2 yen per kg. It earlier climbed to as much as 203.9 yen, the highest since Jan. 13.
"Shanghai market was choppy. I heard buy orders from hedge funds boosted Shanghai futures for a short while, but the prices came off later as most of other investors are still bearish about the market due to weak demand in China," Gu said.
The most-active rubber contract on the Shanghai futures exchange for May delivery rose to as high as 13,455 yuan per tonne before retreating to finish at 13,280 yuan per tonne, down 25 yuan.
"TOCOM trade was very light, with most of investors doing only day-trades as it is not clear which direction the market is heading," Gu said.
The front-month rubber contract on Singapore's SICOM exchange for February delivery last traded at 139.50 U.S. cents per kg, down 0.90 cent.
