China stock market rally buoys rubber futures
Beijing sees economic recovery as ‘worst phase over’ in battle against Covid
Tokyo – Natural rubber (NR) futures closed higher across all major exchanges during the trading week ended 20 Jan, figures from the Japan Stock Exchange (JPX) show.
“There were active buying trading flows and short-covering led by the Chinese markets ahead of the Lunar New Year holidays,” said JPX in its latest weekly report.
In Japan, Osaka exchange rubber futures rose 2%, while SHFE and INE futures in China gained 2% and 4.5% respectively, according to the update issued 23 Jan.
In Singapore, SICOM futures continued on a similar growth track with a 4.3% week-on-week increase, amid active transactions backed by new buying flows.
The positive trends, said JPX, were backed by “strong perceptions” of a solid economic recovery in China, which saw fourth quarter GDP rise 2.9% year-on-year.
China abandoned its zero Covid policy and relaxed border restrictions earlier this month, announcing that “the worst phase is over” in the pandemic.
“These optimistic expectations have pushed the Chinese stock market to rally sharply in the past three weeks,” JPX commented.
Market players, it said, also moved to buy rubber futures with the speculative expectation of the recovery of rubber demand.
Over the holiday period, China's SHFE and INE markets will close for an entire week, resuming on 30 Jan.