Tuesday, September 2, 2008

Tokyo rubber falls 3.5%

Tokyo rubber futures fell 3.5 per cent on Tuesday as a steep fall in oil prices encouraged investors to flee from commodities, including rubber, dragging down the benchmark contract to its lowest level in a week. The key Tokyo Commodity Exchange rubber contract for February delivery closed at ¥307.1 per kg, down ¥11.1 from Monday's close. It earlier hit an intraday low of ¥307 {ndash} the lowest since Aug. 25.

The key TOCOM rubber contract ended an eight-day winning streak on Monday, when it succumbed to pressure after hitting a one-month high of ¥324.9. "Oil prices are the key factor triggering selling in rubber. The fall is very quick after rising near ¥325 on Monday,'' said Mr Takashi Ogura, manager at Kanetsu Asset Management. Asian physical rubber prices edged down following sharp falls in futures prices, but physical prices limited their falls due to rain in Thailand and Malaysia in recent days.

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