TOKYO (Oct 15): Benchmark Tokyo rubber futures ended steady on Wednesday as an initial rally in the Shanghai contract supported prices that had been weighed down by slumping oil.
The Tokyo Commodity Exchange rubber contract for March delivery closed down 0.1 yen at 184.1 yen ($1.7156) per kg, having dropped to as low as 182.8 yen earlier. The contract touched an intra-day high of 184.9 yen.
"The market started down on weaker oil prices, but it lost a sense of direction afterwards and just followed Shanghai prices, which went up and down," said Toshitaka Tazawa, an analyst at Fujitomi Co.
Brent crude fell to a fresh 47-month low on Wednesday before recovering to just above $84 a barrel as faltering global growth curbed demand for fuel at a time of heavy oversupply.
China's consumer inflation slowed more than expected in September to a near five-year low, adding to concerns that global growth is cooling fast unless governments take bolder measures to shore up their economies.
"Despite the weak data, Shanghai rubber prices and stock market moved higher mid-day, which gave a support to the Tokyo market," Tazawa said.
The most-active rubber contract on the Shanghai futures exchange for January delivery ended down 20 yuan at 12,630 yuan ($2,062) per tonne. It had earlier risen to as high as 12,715 yuan.
"The Tokyo benchmark has been hovering below 190 yen for nearly a month. It may be tough to go above that level without any fresh supporting factor," Tazawa said.
The front-month rubber contract on Singapore's SICOM exchange for November delivery last traded at 149.1 U.S. cents per kg, up 0.1 cent.
(1 US dollar = 107.3100 Japanese yen) (1 US dollar = 6.1249 Chinese yuan)