Tokyo futures plunge 3% in volatile trade

Thursday, 29 September 2011 00:12 -     - {{hitsCtrl.values.hits}}

TOKYO (Reuters): Key Tokyo rubber futures settled down 3.1 per cent after plunging as much as 6.2 per cent on Wednesday, and the market may struggle to stay above key support at 300 yen before a long holiday in China and due to worries that upcoming U.S. data may disappoint.

The key Tokyo Commodity Exchange rubber contract for March delivery <0#2JRU:> fell 19.7 yen to settle at 309.7 yen per kg, down 19.7 yen, after plunging as low as 299.7 yen, the lowest since September 2010.

The most active Shanghai rubber contract for January delivery fell 2.6 per cent to close at 27,540 yuan per tonne. Volume stood at 1,349,048 lots.

Less-than-expected speculative buying in China, ahead of a week-long national holiday starting in early October, disappointed investors and prompted them to sell, Kazuhiko Saito, chief commodities analyst at trading company Fujitomi Co.

“We can’t say the market won’t break through the 300 yen mark, given an absence of Chinese buyers and worrying U.S. job data that come out next week,” he said, adding buying may come back after the Chinese holiday.

Commodities fell on Wednesday, giving up their biggest daily gain in more than six months racked up the previous day, as investors flocked to the U.S. dollar on concern data may signal slowing economic growth, and optimism over Europe’s efforts to resolve its sovereign debt problem proved short-lived.

The International Rubber Consortium (IRCo) has asked Thailand, Indonesia and Malaysia to curb exports if rubber prices fall further in the wake of a global economic slowdown, a senior Thai official said on Tuesday.

Natural rubber prices in India are likely to edge lower this week on weak demand from tyre makers and as supply in physical market has been rising due to favourable weather, dealers said on Tuesday.

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