IRCo's WEEKLY MARKET SNAPSHOT: 22 - 26 November 2010

The three major bearish factors which caused investors and speculators to unwind their long positions on commodity markets, including rubber futures, in order to stop losses and to take profits during the week were--worries about European debt problems, tension in Korean peninsula and Chinese monetary tightening.

IRCo's DCP fell to 426.67 US cents/kg on Friday while rubber prices on the physical front also fell in tandem with rubber futures except for rubber latex. A strong greenback weakened commodity prices and regional currencies, especially a Japanese yen. Nonetheless, the current rubber supply tightness and continued growth of auto sales in China and other emerging market countries could lend support for the physical front to some extent. In addition, Wall Street ended mixed on Friday, but its trend was still in an upward direction on the back of investor confidence in the U.S. second quantitative easing program.

It is anticipated that investors and speculators are awaiting the European Union and the International Monetary Fund whether they will come up with a concrete measure to resolve the persistent European debt crisis, how does South Korea react against North Korea's attack last week, and whether China's central bank will introduce any additional measures to tighten its economy so as to tame high inflation in the coming week.

(Source: http://www.irco.biz/MarketWise.php?PHPSESSID=b2ccb645ea1552664592e322c3612e31)