Tokyo futures end down in worst month since Sept (May 31)

TOKYO, May 31 (Reuters) – Tokyo Commodity Exchange rubber futures fell on Thursday, scoring a third straight monthly decline in their worst performance since September as risk aversion by investors amid concerns over the euro zone’s debt crisis took their toll.

The most actively traded TOCOM contract had tumbled to a six-month low as its early dip below last week’s low triggered a wave of selling, but light bargain-hunting trimmed the losses by the close.

Asian shares slid, the yield of Japanese government bonds hit a nine-year low and the euro fell to its lowest in almost two years against the dollar on a jump in borrowing costs for Spain.

“The TOCOM market had been in range-bound trade, keeping its balance between somewhat bearish news from Europe and somewhat bullish news from China. But it’s got weighed down by the Europe side today,” said Gu Jiong, analyst at Japanese commodity brokerage Yutaka Shoji.

“Perhaps we can expect bullish news from Europe in the run-up to Greece’s elections next month. But we may find data from China somewhat disappointing in the next few weeks,” he said.

The most active TOCOM rubber contract for November delivery settled down 9.4 yen, or 3.5 percent, at 262.3 yen per kg. It had broken through the recent low of 259.1 yen to as low as 257.9 yen, the lowest since Nov. 24.

The TOCOM market fell 16.2 percent in May, its worst monthly decline since last September, when it fell 17.2 percent.

News after the close that Thailand was seeking concerted action with fellow producers Indonesia and Malaysia to stabilise falling rubber prices is expected to support nearby TOCOM months, traders said.

But any news about the outlook for global demand would have a bigger impact on distant months, including the November contract, they said.

Thailand, the world’s biggest rubber producer and exporter, hopes cooperation between the world’s top three producers can shore up prices, Thai Deputy Agriculture Minister Nattawut Saikuar told Reuters.

In a sign of weak global demand, Indonesian rubber was traded at four-year lows this week. Thai RSS3 grade, considered the benchmark for physical prices in Asia, changed hands at their lowest level since at least January.

The most active Shanghai rubber contract for September delivery closed down 440 yuan at 23,975 yuan per tonne.

The front-month June rubber contract on the SICOM in Singapore was last traded at 312.5 U.S. cents per kg, down 7.5 cents.

In other markets, Brent crude reversed early losses and climbed towards $104 per barrel on Thursday, receiving a modest boost from a rebound in the euro in late trade in Asia.

(Reporting by Risa Maeda; Editing by Clarence Fernandez)

Source: http://sg.finance.yahoo.com/news/rubber-tokyo-futures-end-down-094648024.html