TOCOM extends gains on weaker yen on July 13

Benchmark Tokyo rubber futures extended gains on Friday on the back of a weaker yen, but the strength was limited amid worries over supply surplus and rising stockpiles in main consuming markets such as China.

The dollar was buoyant near a 10-day peak on Friday, supported by Treasury yields that edged higher on expectations the U.S. inflation rate will rise.

A weaker yen makes commodities denominated in the Japanese currency cheaper for holders of other currencies.

Tokyo Commodity Exchange (TOCOM) futures, which set the tone for rubber prices in Southeast Asia, gained 0.9% for the week, recovering slightly from a 21-month intraday low hit on July 5.

The Tokyo Commodity Exchange rubber contract for December delivery finished 0.3 yen higher at 172.9 yen (US$1.53) per kg, ahead of a three-day holiday.

Japanese financial markets will be closed on Monday for a national holiday.

"The markets were quiet ahead of an extended holiday," said a broker.

The most-active rubber contract on the Shanghai futures exchange for September delivery dropped 20 yuan to finish at 10,325 yuan (US$1,545) per tonne.

Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 1.7% from last Friday, the exchange said on Friday.

The front-month rubber contract on Singapore's SICOM exchange for August delivery last traded at 130.5 U.S. cents per kg, down 0.6 cent.

(US$1 = 112.7700 yen)

(US$1 = 6.6844 Chinese yuan)