Market and product
NMCE Rubber drops on short selling
The rubber futures are projected to trade range bound on mixed sentiments prevailing in market on Tuesday. TOCOM rubber July futures are trading positive at ¥499.20 per Kg. However, down spot market activity might pressurize the prices initially. Thus, on cues from international and domestic market futures are likely to trade on a mixed note today.
Factors to Watch For
Shanghai market will resume trade tomorrow after the weeklong holiday due to Lunar New Year. Natural-rubber inventories monitored by the Shanghai Futures Exchange is reported around at 58,673 tons, which is down by 61 % from last year’s highest inventories of 151,832 tons
According to the Rubber Research Institute of Thailand, Farmers reduce tapping during the wintering period from February to May, when rubber trees shed leaves and latex production declines. Some plantation areas in northeast Thailand have already entered the low-output season
According to the Rubber Research Institute of Thailand, the Thai physical price remained at a record 184.05 baht ($5.97) per kilogram yesterday
According to the Association of Natural Rubber Producing Countries, Natural-rubber consumption in China may rise 9% to 3.6 million tons this year and India’s consumption may gain 5.2% to 991,000 tons
According to China Association of Automobile Manufacturers, Car-sales growth in China will be around 10 to 15 percent this year Total auto sales, which include cars, trucks and buses, jumped 32 percent last year to 18.06 million
DERIVATIVE ANALYSIS
Indian Futures (NMCE)
The NMCE February contract, prices and open interest are falling while volumes are rising. Market is running out of traders willing to open or hold an open sell/short. Traders are liquidating both loosing buy positions & closing winning short positions. Prices are likely to remain volatile to down.
Japan Futures (TOCOM)
The TOCOM active June contract, prices and volumes have fell while open interest has increased. It is a good indication that a sharp rally against downtrend will develop creating a sell point for downtrend.
