TOKYO, Feb 15 (Reuters) – Benchmark Tokyo rubber futures rose on Thursday, bouncing back from near 8-month lows hit the previous session, on the back of higher oil and metals prices, but trades were thin as China began a week-long Lunar New Year holiday.
Oil prices rose by around 1 percent on Thursday to extend gains from the previous session, lifted by a weak dollar and Saudi comments that it would rather see an undersupplied market than end a deal with OPEC and Russia to withhold production. London copper prices on Thursday rose for a fourth session to their highest in 10 days, supported by a decline in the dollar and robust prospects for global growth. The Tokyo Commodity Exchange (TOCOM) rubber contract for July delivery finished 1.7 yen higher at 186.0 yen ($1.75) per kg. It hit the lowest since June 21 of 184.1 yen the previous day.
“Higher commodities prices offset pressure from a higher yen,” said Jiong Gu, an analyst at Yutaka Shoji Co.
The dollar extended its losses against the yen and hit a new 15-month low on Thursday, with market participants bracing for further near-term weakness in the U.S. currency. A stronger yen makes yen-denominated assets less affordable when purchased in other currencies.
“But the market’s overall sentiment is still bearish due to concerns over rising inventories,” Gu said, predicting further downside in the coming days.
Chinese markets will be closed for a week from Thursday for the Lunar New Year holiday.
($1 = 106.4300 yen)
(Reporting by Yuka Obayashi; Editing by Biju Dwarakanath)