Japan futures set for biggest weekly gain since April as yen weakness offsets soft demand

By Reuters News

By Emily Ou Yong

Sept 25 (Reuters) - Japanese rubber futures traded in a tight range on Friday, as a weaker yen offset softening tyre demand ahead of holidays in top rubber consumer China, keeping the contract on track for its biggest weekly gain since the week ended April 3.

  • The Osaka Exchange (OSE) rubber contract for March delivery , was up 0.7 yen, or 0.16%, at 451.9 yen ($2.85) per kg as of 0200 GMT.

  • The contract has gained 5.04% so far this week.

  • The Shanghai Futures Exchange is closed for China's Mid-Autumn Festival. Trading will resume on Monday, September 28.

  • The Japanese yen weakened 0.32% against the greenback to 158.82 per dollar after Japanese Finance Minister Satsuki Katayama said the principles underpinning the coordinated Japan-US currency intervention in July remain intact, but sentiment remained fragile after last week's Bank of Japan rate hike did not convince investors that a faster tightening cycle is in store. USD/

  • A weaker currency makes yen-denominated assets more affordable to overseas buyers. FRX/

  • Semi-steel tyre production stood at 61.19% for the week to September 24, down 3.75 percentage points week-on-week, while all-steel tyre production fell 6.49 percentage points to 53.4% over the same period, data from rubber information provider Qinrex showed.

  • Downstream tyre demand is falling short of expectations as the long holiday in China approaches, with production activity weakening and purchasing limited to immediate needs, analysts from broker Everbright Futures said in a note.

  • Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 0.7% from last Friday, the exchange said on Thursday.

  • The front-month rubber contract on Singapore Exchange's SICOM platform for December delivery last traded at 249.6 US cents per kg, up 0.1%.

($1 = 158.6600 yen)

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.

The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.

To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.

Any information which could be construed as “investment research” has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.