By Aya Takada and Supunnabul Suwannakij Feb. 16 (Bloomberg) -- Rubber rose as a rally in stocks boosted investor confidence in economic recovery and stoked speculation demand for the commodity used in tires will grow. Futures in Tokyo gained for the fourth time in five days, recovering from a seven-week low of 265.6 yen per kilogram ($2,951 a metric ton) reached Feb. 9. The price is still about 7 percent lower than this year’s peak of 306 yen. Japanese stocks advanced after the European Union said it will take steps to help Greece cut its budget deficit, easing concern debt problems may slow economic recovery in Europe. The Nikkei 225 Stock Average gained 0.2 percent, South Korea’s Kospi Index added 0.5 percent and Australia’s S&P/ASX 200 Index gained 0.5 percent. Markets in China, Hong Kong, Taiwan, Singapore, Vietnam and Malaysia are shut for the Lunar New Year. “Easing concerns over the economic hurdles in Greece drew money into commodities products,” Chaiwat Muenmee, analyst at DS Futures Co., said by phone from Bangkok. “Market sentiment improved as Asian equities and other commodities rebound.” Rubber for July delivery, the most-active contract, rose as much as 1.1 percent to 287.2 yen before settling at 286.9 yen on the Tokyo Commodity Exchange. Crude oil for March delivery gained as much as 52 cents, or 0.7 percent, to $74.65 a barrel in electronic trading on the New York Mercantile Exchange at 3:08 p.m. Singapore time, supporting rubber prices, according to Chaiwat. Prices were also supported as production in Thailand, the world’s largest producer, is set to decline, Saito said. During wintering, or the low production season that normally begins in the nation’s main producing areas in February, rubber trees shed their leaves and latex output slows. Gains were limited amid concern that China’s attempt to cool its economic expansion may curb demand for the commodity, he said. The People’s Bank of China said on its Web site Feb. 12 that the reserve requirement for banks will increase 50 basis points effective Feb. 25. China’s policy makers are aiming to avert asset bubbles and restrain inflation after flooding the economy with money last year to drive a recovery from the first global recession since World War II. The Shanghai Futures Exchange is closed this week for the Lunar New Year holidays. --Editor: Ravil Shirodkar To contact the reporters on this story: Aya Takada in Tokyo at +81-3-3201-8461 or atakada2@bloomberg.net; Supunnabul Suwannakij in Bangkok at +662-654-7324 or ssuwannakij@bloomberg.net To contact the editor responsible for this story: Wendy Pugh at +61-3-9228-8736 or jpoole4@bloomberg.net

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