Reacting negatively to the developments around natural rubber prices, major tyre stocks on Friday fell in the range of 1-4 percent.
Investors turned bearish on such stocks as they anticipated profitability to take a hit on the back of rising cost of natural rubber, a key component in tyre makers’ input cost. Natural rubber constitutes 40 percent of the total cost of the tyre.
The commodity’s price rose to a two-and-a-half-year high on January 12 due to supply constraints and tracking gains in overseas markets. There has been a disruption in supply from Thailand, the top producer of the commodity, on the back of flooding in a region.
Source: www.globalrubbermarkets.com
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