Asian Rubber Settles Lower Ahead of Key Events

Asian rubber settled lower Monday, tracking a commodities sell off Friday on Wall Street as investors reduced risk ahead of key events this week, including U.S. presidential elections and leadership changes in China.

Benchmark May natural rubber futures on the Shanghai Futures Exchange settled 2.9% lower at CNY23,885 a metric ton after dropping as much as 4.3% intraday.

A Singapore-based dealer said buying sentiment from China isn't strong due to high inventories at the major rubber port of Qingdao. Natural rubber stocks at the port totaled some 233,000 tons as of end-October, said traders. The data isn't publicly released.

Chiaki Furui, chief executive of Bangkok-based commodities brokerage Agrow Enterprise, said SHFE rubber's losses may be due to the change in the benchmark contract to May from January last week, as investors are less certain of prices in a forward month.

Benchmark April natural rubber futures on the Tokyo Commodity Exchange settled 3.2% lower at Y247.2 a kilogram, tracking the sharp decline in Shanghai rubber.

Mr. Furui said the U.S. dollar's movement may be the key driver of Tocom rubber this week, so eyes are on the U.S. presidential election and its impact on the country's currency.

April Tocom rubber closed Y1 lower at Y246.2/kg in the night session, which is considered part of the next trading day.