Tokyo, Shanghai futures fall to multi-year lows on China growth worries

Tokyo rubber futures tumbled more than 3 percent to near its 5-year low on Monday, tracking falling Shanghai rubber prices that also declined sharply due to concerns over China's economic outlook, dealers said.

The Tokyo Commodity Exchange rubber contract for February delivery edged down 5.7 yen to settle at 183.5 yen per kg.

It fell as much as 6.2 yen, or 3.3 percent, to an intra-day low of 183 yen per kg, the lowest since Sept. 2009.

"People are very nervous ahead of the data. You've got long liquidation ahead of the release of the figures, which could be very bearish," said a dealer in Tokyo.

"I don't know what the support level is for Shanghai futures. For Tokyo, 175 yen will be the support level, while resistance will be 185 yen."

Dealers said investors liquidated rubber contracts ahead of the announcement of Chinese manufacturing data on Tuesday on concerns the numbers could disappoint.

China's flash manufacturing PMI reading on Tuesday could come in below the 50 level, indicating manufacturing activity is contracting, after the country reported the slowest factory output growth in nearly six years.

China's Finance Minister Lou Jiwei said on Sunday the country would not dramatically alter its economic policy because of any one economic indicator. The remarks came days after many economists lowered growth forecasts, having seen the latest set of weak data.

Japanese dealers said the unfruitful G20 meeting also weighed on the market as there has been no sign of economic recovery, with Europe's extended stagnation remaining a major stumbling block.

The most-active rubber contract on the Shanghai futures exchange for January delivery touched a record low of 12,435 yuan a tonne. The contract has fallen more than 37 percent so far this year.

The contract fell 655 yuan to finish at 12,435 yuan per tonne.

The front-month rubber contract on Singapore's SICOM exchange for October delivery was last traded at 145.80 U.S. cents per kg, down 5.2 cents.