【Fuji Tomi】Tokyo crude oil and rubber rebound sharply

(Tokyo crude oil and oil products)
On the 5th, Tokyo crude oil and oil products surged sharply due to a sharp rebound in overseas crude oil. The near-month crude futures for September were up 1,130 yen from the previous day at 36,940 yen, the near-month gasoline futures for October up 1,020 yen at 50,140 yen, and the near-month kerosene futures for October up 1,160 yen at 48,390 yen.
Following the sharp rise in NY oil products, WTI and Brent also showed a strong V-shaped rebound, with WTI breaking above the $51 level. With the yen stabilizing after its rise, the Tokyo oil market recovered by about 1,000 yen from night-time lows, continuing the rally. After the U.S. API inventory data released after-hours showed robust figures, there was some pre-emptive buying, but after WTI near-month May term reached $51.30, gains narrowed. In daytime Tokyo trading, after further gains, buying cooled somewhat, and with the yen’s weakness pausing earlier, WTI was bought again, pushing Tokyo crude to new highs. However, as the Nikkei stock average fell at noon, the yen strengthened, and Tokyo oil market gains temporarily retreated. From 14:00 onwards, taking the rise in NY oil products as a cue, WTI buying resumed, and in the near-month crude, it moved into the 36,900 yen range in Tokyo. Night trading naturally focused on the U.S. EIA release. If the report is weak and still fails to fall, it would indicate fund money shifting, potentially supporting another rebound.

(Tokyo precious metals)
On the 5th, Tokyo gold held firm with the yen weakening. The near-month gold February contract up 3 yen at 4,452 yen, and the near-month platinum February contract up 37 yen at 3,428 yen.
Tokyo gold traded in a narrow range with light activity. In daytime, it briefly rose to the high of the night, trading around 4,460 yen, with the decisive factor being the weaker yen. When the yen’s weakness paused, prices slipped, and by early afternoon, the yen’s strength due to the Nikkei’s decline pushed it down to the daytime low of 4,451 yen. The Nikkei rebounded toward the close, and with the yen weakening again, Tokyo gold was bought back modestly.

(Tokyo rubber)
Tokyo rubber surged sharply on the 5th. The near-month August contract rose 14.0 yen to 250.7 yen.
Tokyo rubber has shown a stronger rebound than the previous day’s sharp decline. In the morning, buying supported by a weaker yen returned, quickly recovering to the 240 yen range. Afterwards, the market seemed to wait for Shanghai, showing a typical post-holiday stance. Although traders expected Shanghai rubber to fall, prices continued to rise, expanding Tokyo’s gains. Before 11:00, prices exceeded 245 yen, and by early afternoon, reached the 247 yen level. The high in the near-month March 30 at 247.2 yen had been surpassed. The surge in the current month encouraged buybacks in the Tokyo front-month. Since there was substantial selling among the public in the current month, the exchange issued guidance to liquidate in the previous week, but the unwinding has been slow, keeping the current month rising day after day. Expecting continued buying, people were cautious about the front-month’s internal factors. Around 14:30, the price moved to the 249 yen range, influenced by the current-month gains. Just before 15:00, it hit 250 yen. A notable feature of today’s rise is that after updating the daytime high, there was little pullback; it was driven by buying pressure. It looks overly aggressive, but given the late-day surge, there is room to exceed 250 yen in night trading as well.

(Tokyo corn)
Tokyo corn on the 5th showed weak reaction to Chicago’s price drop and held its ground, with the near-month March contract at 21,860 yen.
Although the yen’s strength paused, Chicago corn fell sharply toward the close, suggesting further downside for Tokyo corn might be expected, but since the previous day’s high had been sharply erased, night trading saw cautious selling and the decline was limited. Subsequently, as Chicago’s prices were reassessed, it dipped below 21,800 yen, but the drop was not substantial. Chicago corn, reopened at 9:00, rose on the back of Chicago soybeans, supporting Tokyo’s midday recovery, but as the yen strengthened and Chicago’s gains narrowed, selling pressure returned. Overall, the downside remained restrained. As a result, prices fell in the 13:00 hour due to the yen’s strength. The stance remains favored for selling on the rebound.

(Tokyo US soybeans)
Tokyo ordinary soybeans on the 5th showed rebound after Chicago’s rapid rise following the market reopening. The near-month February contract up 10 yen at 46,710 yen.
Reopening Chicago soybeans surged, driven by expectations of large US soybean purchases by China. With planned US-China summit on the 6th and 7th, and China’s president visiting the US, markets expect large soy purchases, prompting speculative buying. However, such developments are likely to be short-lived, and Tokyo’s adjustment losses may still have room to fall, suggesting the upside may be limited for now.
https://www.fujitomi.co.jp/?p=14239