Tokyo rubber futures fall from 2-week high on China worries

enchmark TOCOM rubber futures fell on Thursday, slipping from a two-week high as weak Chinese factory data revived concerns about slowing demand growth in the world’s top rubber buyer.

FUNDAMENTALS

The Tokyo Commodity Exchange rubber contract for April delivery was down 1.4 yen, or 0.9 percent, at 157.8 yen per kg by 0102 GMT, after climbing to the highest since Oct.29 on Wednesday.

China’s factory output growth hit a 7-month low in October while investment expansion slipped to its weakest pace since 2000, signs that further government policy support may be needed to shore up slowing demand in the world’s second biggest economy.

Motor vehicle sales in China rose 11.8 percent in October from a year earlier, an industry association said on Wednesday, boosted by Beijing’s move to stop the world’s biggest auto market from stalling by halving sales tax on smaller-engine cars.

Most Japanese companies do not expect the nation’s flagging economy to recover until well into next year at the earliest, as a China-led slowdown keeps overseas demand weak and consumer spending at home remains sluggish, a Reuters survey showed.

MARKET NEWS

U.S.crude oil prices held near more than two-month lows in early Thursday trading, after a sharp slide on concerns the market will take much longer than many anticipated to rebalance as supplies far outstrip demand.

Zinc and lead recovered from multi-year lows on Wednesday

and copper steadied, having earlier veered towards a six-year trough after a gauge of top metals consumer China’s factory health showed ongoing weakness in the world’s top metals consumer.

The U.S. dollar, euro and yen started Thursday’s trade on familiar ground, having drifted in slim ranges overnight in a session lulled by the U.S.Veterans Day holiday.

The dollar was quoted around 122.7 yen JPY= in early Thursday.

Japan’s benchmark Nikkei stock average (XC0009692440) was down 0.4 percent in Thursday trade, after Wall Street ended a choppy session lower as a sharp drop in oil prices knocked energy stocks. MKTS/GLOB

DATA/EVENTS (GMT)

The following data is expected on Thursday: (Time in GMT)

0700 Germany Consumer prices final Oct

1000 Euro zone Industrial production Sep

1330 U.S. Weekly jobless claims

1500 U.S. JOLTS job openings Sep