By Aya Takada
Feb. 24 (Bloomberg) -- Natural rubber futures declined as a sell-off in global equity markets deepened concern that worsening economic slump will weaken demand for the commodity used in tires.
Prices in Tokyo lost as much as 3.5 percent. Asian equities slid, dragging the regional benchmark to the lowest in more than five years. The MSCI Asia Pacific Index is set for its lowest close since Aug. 28, 2003.
“A slump in global equities spurred investors to cut holdings of risk assets,” Jun Nishimuta, an analyst at Kanetsu Asset Management Co. in Tokyo, said today by phone.
Rubber for July delivery lost 2 percent to 133.2 yen a kilogram ($1,401 a metric ton) on the Tokyo Commodity Exchange at the 12:54 p.m. local time. Rubber for August delivery, listed on the exchange today, ended the morning session at 134.5 yen after trading between 132.5 and 135.4.
Rubber futures also declined as falling crude oil pared the cost of making rival synthetic product, Nishimuta said.
Oil fell for a third day on speculation that U.S. stockpiles will rise for the 19th week of the past 22 as the slowdown crimps fuel demand.
May-delivery rubber on the Shanghai Futures Exchange, the most-active contract, lost 4 percent to 12,585 yuan ($1,840 a ton) at 11:30 a.m. local time.
To contact the reporter on this story: Aya Takada in Tokyo atakada2@bloomberg.net
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