TOCOM rises on position adjustment, but marks 3rd quarterly loss

Benchmark Tokyo rubber futures pared earlier losses to end higher on Friday, as investors unwound positions ahead of China's long holiday, but marked their third quarterly loss in a row amid lingering concerns over the US-Sino trade conflict.

Tokyo Commodity Exchange (TOCOM) futures, which set the tone for rubber prices in Southeast Asia, hit a 10-day low earlier in the session, but recovered later as bargain-hunting kicked in, a Tokyo-based dealer said.

The TOCOM rubber contract for March delivery finished 0.9 yen, or 0.5%, higher at 168 yen (US$1.48) per kg, after touching the lowest since Sept 18 of 165.3 yen.But it ended the month 3.3% lower and is down 4.7% for the quarter.

"A stronger yen against the US dollar also lent support to the TOCOM," the dealer added.

The dollar traded at 113.50 yen after gaining roughly 0.6% overnight to 113.64, its highest since December 2017.

A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.

The most-active rubber contract on the Shanghai futures exchange for January delivery fell 40 yuan to finish at 12,360 yuan (US$1,797) per tonne.

Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 1.1% from last Friday, the exchange said on Friday.

China's financial markets will be closed from Oct 1 to Oct 5 for the National Day holiday.

The front-month rubber contract on Singapore's SICOM exchange for October delivery last traded at 134 US cents per kg, up 0.2 cent.

(US$1 = 6.8788 Chinese yuan renminbi)

(US$1 = 113.4600 yen)