Rubber Advances to Highest in Almost Nine Months as Oil Gains

Rubber climbed to the highest since November, gaining for a third day, as crude oil advanced amid renewed optimism that a global economic recovery will increase demand for the commodity used to make tires.

Futures advanced as much as 2.3 percent as crude rose to a one-month high, boosting natural rubber’s appeal against its synthetic rival. Nouriel Roubini, an economist who predicted the financial crisis, said today that commodities may extend gains next year as the global recession abated.

Manufacturing in China climbed for a fifth month in July, CLSA Asia-Pacific Markets said today in an e-mailed statement. The CLSA China Purchasing Managers’ Index rose to a seasonally adjusted 52.8, the highest level in a year, from 51.8 in June.

The Dollar Index, which tracks the dollar against the currencies of six major U.S. trading partners including the euro, was at 78.414 at 3:59 p.m. in Singapore from 78.347 on July 31. It earlier touched 78.049, the lowest since Dec. 18.

Rubber advanced for a fourth day after U.S. auto sales posted their best month this year, raising optimism the industry’s worst drop in three decades may be ending.

Prices in Tokyo for the commodity used in tires gained as much as 3.4 percent after the month’s annual sales pace was 11.2 million, according to data yesterday from Autodata Corp. Today’s rise pushed rubber to the highest since Nov. 5, with a 47 percent advance this year.

“Improvement in the U.S. and Japanese auto sales raised optimism rubber demand will increase,” Kazuhiko Saito, chief analyst at Tokyo-based commodity broker Fujitomi Co., said today in a telephone interview.

January-delivery rubber gained as much as 6.6 yen to 202.9 yen a kilogram ($2,126 a metric ton) before trading at 200 yen on the Tokyo Commodity Exchange at 10:54 a.m. local time.

China’s passenger-vehicle sales rose 48 percent in June, the biggest jump since February 2006, as tax cuts and government subsidies helped the nation extend its lead over the U.S. as the world’s largest auto market this year.

Chinese motorists bought 872,900 cars, sport-utility vehicles and other passenger vehicles last month, the China Association of Automobile Manufacturers said on July 9. Overall vehicle sales, which include buses and trucks, rose 36 percent to 1.14 million.