TOKYO, Nov 10 (Reuters) – Key Tokyo rubber futures rose 5 percent on Monday before drifting lower to end slightly above 190 yen, on gains in oil which drew strength from hopes that plans to lift economic growth would stimulate energy demand.
* The key Tokyo Commodity Exchange rubber contract for April delivery <0#JRU:> finished at 190.4 yen per kg, after rising to an intra-day high of 193.2 yen, up 9.3 yen or about 5 percent, with an additional boost provided by a weaker yen.
* The key contract has recovered more than 20 percent since falling in late October to 153.4 yen, the lowest level since July 2005.
* Physical rubber traders said news that China, a top rubber consumer, had approved a 4 trillion yuan ($586 billion) government spending package to boost domestic demand was positive news for the industrial commodity.
* They said, however, that buying from China has been slow since the global credit crisis, and that more time will be needed to gauge how the economic package will help stimulate consumption of the industrial commodity, used largely for tyres.
* “It’s positive for the market … but it will take time to figure out the actual impact,” a rubber trader in Thailand said.
* Near-term, the benchmark TOCOM rubber price is likely to continue to move between 160-200 yen, the range that it has fluctuated since mid-October, a Tokyo broker said.
* “There will have to be some very bright news, particularly about the real economy, for the market to move and stay above 200 yen,” he said.
* He noted that TOCOM rubber was unable to stay above 200 yen when it rose above that level last week.
* U.S. crude futures rose more than $3 to top $64 a barrel on hopes that proposals from the world’s leading economies to boost growth would help ward off a global recession and revive energy demand.
* The dollar rose to 99.14 yen , up 0.9 percent from late U.S. trading on Friday.
* Toyota Motor Corp <7203.T> more than halved its profit forecast last week, saying annual net earnings will plunge as the financial crisis batters demand for its cars, in news that added to the rubber market’s woes.

PRICES OF ASIAN PHYSICAL RUBBER COMPARED WITH FRIDAY
Grade Price Change
Thai RSS3 (Dec) $1.85/kg +$0.05
Thai RSS3 (Jan) $1.85/kg +$0.05
Thai STR20 (Dec) $1.85/kg +$0.07
Thai STR20 (Jan) $1.85/kg +$0.07
Malaysia SMR20 (Dec) $1.85/kg +$0.05
Malaysia SMR20 (Jan) $1.85/kg +$0.05
Indonesia SIR20 (Dec) $0.82/lb +$0.02
Indonesia SIR20 (Jan) $0.82/lb +$0.02
Thai USS3 59 baht/kg + 1 baht
Thai 60-percent latex (drums, Dec) $1,500/tonne +$100
Thai 60-percent latex (bulk, Dec) $1,350/tonne -$50

Source:  Reuters

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