TOKYO, Nov 9 (Reuters) – Benchmark Tokyo rubber futures inched down on Monday as a stronger U.S.dollar dragged on commodity prices and persistent worries about an oversupply in Asia outweighed firmer Tokyo equities.
The Tokyo Commodity Exchange (TOCOM) rubber contract for April delivery JRUc6 0#2JRU: finished 0.2 yen lower at 154.9 yen ($1.26) per kg. The TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, fell to a low of 153 yen last week, the lowest level since July 2009, amid concerns over slowing demand in top buyer China.
“Softer prices of commodities in the wake of strong U.S.jobs data which led to a jump in the dollar depressed the market sentiment from opening,” said Hiroyuki Kikukawa, general manager at Nihon Unicom.
U.S. job growth surged in October and the unemployment rate hit a 7-1/2-year low of 5.0 percent in a show of economic strength that makes it much more likely the Federal Reserve will raise interest rates in December.
Oil prices fell as much as 2 percent on Friday on pressure from a rallying dollar although Brent crude regained ground on Monday as the dollar moved away from last week’s peak. O/R The U.S. dollar hit its loftiest in almost seven months on Friday following strong U.S.nonfarm payrolls data.
It stood at a seven-month high on Monday. USD/ London copper lost ground below the $5,000 mark on Monday and was sliding towards six-year lows after China trade data underlined struggling growth in the world’s top metals user.
China’s trade figures disappointed analysts expectations by a wide margin in October, reinforcing views that the world’s second-largest economy will have to do more to stimulate domestic demand given softness in overseas markets.
Japanese stocks jumped 2 percent to a 2-1/2 month high on Monday as the yen weakened considerably against the dollar after Friday’s strong U.S.jobs report.
“Investors now focus on whether or not the rubber benchmark can keep a key 150 yen level while nagging worries about weakening demand growth in China continue,” Kikukawa said. The most-active rubber contract on the Shanghai Futures Exchange for January delivery SNRcv1 fell 5 yuan to finish at 10,500 yuan ($1,650.92) per tonne. The front-month rubber contract on Singapore’s SICOM exchange for December delivery STFc1 last traded at 117.2 U.S. cents per kg, down 0.4 cent. ($1 = 6.3601 Chinese yuan) ($1 = 123.3800 yen)
(Reporting by Yuka Obayashi; Editing by Subhranshu Sahu)