Rubber declined from a five-month high as a drop in global stock markets raised concern that the economic recovery may falter and lower oil prices cut the appeal of the commodity as an alternative to synthetic products. Futures shed as much as 0.9 percent after reaching 311.5 yen per kilogram ($3,685 a metric ton) on Sept. 22, the highest level since April 28. The price gained 4 percent this week, heading for the best performance since May 28. Japanese shares fell for a third day on concern that a deteriorating profit outlook for U.S. banks and an increase in U.S. jobless claims will slow the global recovery. Oil declined on speculation U.S. fuel demand may decelerate. “Weak economic data from the U.S. and Europe curbed investor appetite for riskier assets, leading to sales of the raw material,” Hisaaki Tasaka, an analyst at Tokyo-based broker ACE Koeki Co., said today by phone. February-delivery rubber fell 0.5 percent to 308.1 yen per kilogram on the Tokyo Commodity Exchange at 10:59 a.m. The September contract, expiring today, added 1.7 percent to 298 yen. The market was closed yesterday and Sept. 20 for holidays. Asian stocks declined after the U.S. Labor Department reported claims unexpectedly increased by 12,000 to 465,000 in the week ended Sept. 18, as the unemployment rate remains near a 26-year high. Growth in Europe’s services and manufacturing industries weakened more than economists forecast in September, adding to signs the recovery is losing steam. Oil for November delivery lost as much as 0.7 percent to $74.66 a barrel on the New York Mercantile Exchange before trading at $74.81. Wet Weather Losses in rubber futures were limited as wet weather constrained supply in Thailand, the world’s largest producer and exporter, Tasaka said. The cash price in Thailand advanced for a third day on Wednesday, rising 0.7 percent to 108.35 baht ($3.54) per kilogram, as rains continue in the country’s main plantation areas, curbing supply, the Rubber Research Institute of Thailand said on its website. Some companies accelerated purchases to ensure they meet deliveries, the institute said. Drought earlier this year followed by heavy rain has hampered tree-tapping across plantations in Asia, according to Pongsak Kerdvongbundit, managing director of Phuket, Thailand- based Von Bundit Co. Persistent rains will probably continue across the country in the second half of September, the Thai weather office said on its website. Natural-rubber consumption will outpace supply by 127,000 tons next year, the widest production deficit since 2007, according to Goldman Sachs Group Inc. Stockpiles will drop 12 percent to 67 days of demand in 2011, the lowest level in at least 11 years, the bank estimated in a report this month. The Shanghai rubber market is closed today for a holiday. The March-delivery contract last traded at 26,805 yuan ($4,004) a ton on Sept. 21. To contact the reporter on this story: Aya Takada in Tokyo at atakada2@bloomberg.net; To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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