Rubber ends three-day slump on oil gains

Rubber ended a three-day decline as crude oil rose and data showed growth in China’s manufacturing accelerated, boosting speculation demand will expand from the world’s largest consumer of the commodity used in tires. The most-active contract on the Tokyo Commodity Exchange gained as much as 0.9 per cent to ¥329.8 per kilogram ($4,084 a metric tonne) before settling at ¥327.2.

The contract fell as much as 1 per cent earlier as Japan vehicle sales tumbled and on speculation the Japanese currency may strengthen if the Federal Reserve goes ahead with easing policies that will further debase the dollar, reducing the appeal of the yen-denominated commodity. China’s Purchasing Managers’ Index increased to 54.7 in October, the Federation of Logistics and Purchasing said. The reading compared with 53.8 for both the previous month and the median forecast of 13 economists surveyed by Bloomberg News. “The data showed the strength of China’s industrial production,” Kazuhiko Saito, an analyst at Tokyo-based broker Fujitomi Co, said today by phone. “Chinese demand for raw materials will keep expanding.” May-delivery rubber on the Shanghai Futures Exchange surged as much as 3.9 per cent to 31,950 yuan ($4,784) a tonne before closing at 31,420 yuan.