TOKYO, Oct 22 (Reuters) – Key Tokyo rubber futures closed down nearly 6 percent on Wednesday, but off the intraday low when prices fell by the 16 yen daily limit after a tumble in crude oil prices pulled the plug on a three-day rally.
* The key Tokyo Commodity Exchange rubber contract for March delivery <0#JRU:> finished at 180.7 yen per kg, down 11.3 yen or 5.9 percent, after earlier falling 16 yen to an intraday low of 176 yen.
* Tokyo rubber has been on a rollercoaster ride this week with prices soaring by the 16 yen daily limit on Monday and Tuesday as part of a three-day rally that helped lift the value of the industrial commodity by over 20 percent to above 200 yen.
* It has already lost about half those gains.
* The recent technical rally lacks momentum because there are few factors distinctive to the rubber market to help support it, a Tokyo broker said.
* “I think the market might fall even further,” he said.
* Mounting concerns that demand would shrink amid growing fears of a global recession has caused TOCOM rubber to slide about 40 percent from early September to a trough of 159.3 yen on Friday, the lowest since July 2005.
* It later staged a rally but traders have voiced doubts about the strength of the recovery, noting that funds have fled the market in droves.
* In fresh bearish news for the market, a newspaper report said Toyota Motor Corp <7203.T> plans to say its annual profit will likely halve in the financial year to next March due to a stronger yen and slowing sales owing to the financial crisis. [ID:nT32215]
* A major use for rubber is the production of tyres for automobiles.
* U.S. crude oil futures fell over $3 to trade below $70 a barrel on mounting worries that output cuts by OPEC will not be enough to offset slackening energy demand among leading consumers. [O/R]
* Physical rubber prices mostly fell, reflecting the decline on the Tokyo futures market.
* A Thai trader said a January RSS3 cargo was traded on Tuesday at $1.83, while a January SIR20 cargo changed hands at $0.80.
PRICES OF ASIAN PHYSICAL RUBBER COMPARED WITH TUESDAY
Grade Price Change
Thai RSS3 (Dec) $1.82/kg -$0.08
Thai RSS3 (Jan) $1.82/kg unavailable
Thai STR20 (Dec) $1.82/kg -$0.08
Thai STR20 (Jan) $1.82/kg unavailable
Malaysia SMR20 (Dec) $1.82/kg -$0.08
Malaysia SMR20 (Jan) $1.82/kg unavailable
Indonesia SIR20 (Dec) $0.78/lb -$0.07
Indonesia SIR20 (Jan) $0.78/lb unavailable
Thai USS3 57 baht/kg -3 bahts
Thai 60-percent latex (drums, Dec) $1,400/tonne unavailable
Thai 60-percent latex (bulk, Dec) $1,250/tonne unavailable

Source:  Reuters

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