Rubber drops most in two weeks on Chinese demand

Rubber has slumped the most in two weeks after a survey showed China's manufacturing may contract for an 11th month in September, raising concerns demand from the world's largest user may weaken for the commodity used in tires.

February-delivery rubber lost 2.4 percent to settle at 253.9 yen a kilogram ($3,25) on the Tokyo Commodity Exchange, the biggest drop since Sept. 5 and extending this year's loss for the most-active contract to 3.6 percent.

The preliminary reading was 47.8 for a purchasing managers' index released by HSBC Holdings Plc and Markit Economics, adding to signs that China's economy is decelerating for a seventh quarter.

It compares with the 47.6 final reading last month and if confirmed would extend the gauge's longest streak below the expansion-contraction dividing line of 50 in the survey's eight-year history.

"The market was weighed down by concerns that China's economic slowdown may worsen," said Takaki Shigemoto, an analyst at research company JSC Corp in Tokyo.