Platinum Futures Surge on Japanese Buying
Undated (AP) _ Platinum futures prices surged more than $10 an ounce Tuesday amid a bevy of bullish factors, including signs of buying by the world’s biggest platinum jewelry consumers - the Japanese.
On other commodity markets, other precious metals were mixed; energy futures rose; livestock and meat futures advanced; and grains and soybeans were mixed.
Trading on New York’s five commodity exchanges was halted four times during the day because of a data transmission problem.
Trading was halted at the Commodity Exchange, the nation’s main metals market; the New York Mercantile Exchange, the main oil trading market; the Coffee, Sugar and Cocoa Exchange; the Cotton Exchange; and the New York Futures Exchange.
Platinum futures settled $10.80 higher across the board on the New York Merc with the contract for delivery in October at $485.20 a troy ounce.
The powerful rally did not extend to gold and silver futures, which are traded on the Commodity Exchange. Gold settled $2.20 to $2.60 higher with August at $370 a troy ounce; silver was 1.5 cents to 1.8 cents lower with August at $4.787 a troy ounce.
The platinum market opened strongly on indications the Japanese bought platinum bullion overnight, analysts said.
Platinum is the jewelry and investment metal of choice in Japan, making the Japanese key players in the market.
″We’ve seen a bit of lag on their part, but they came back today,″ said William O’Neill of Merrill Lynch.
Strength in the oil market further supported the precious metals, analysts said. The dollar’s weakness against other major currencies also was bullish for the metals, as were reports of renewed tension between Iraq and Kuwait.
Analyst Bette Raptopoulos of Prudential-Bache Securities Inc., said the potential for violence-related platinum supply disruptions from South Africa remained a bullish ″underlying factor.″
Gold rallied strongly at the opening but encountered strong resistance as the spot delivery price approached $375 an ounce. Silver futures were depressed by weak demand and plentiful supplies, analysts said.
Crude oil for near-term delivery rose strongly on the New York Merc on reports that Iraq had amassed 100,000 troops on Kuwait’s border.
Iraq has accused its small Persian Gulf neighbor of stealing oil from a disputed border region and causing oil prices to drop.
After the close, the American Petroleum Institute released a weekly report that showed far more crude oil on hand than analysts had expected.
The API reported a 2.9 million-barrel increase in U.S. crude stocks last week as opposed to expectations for a 2 million barrel decline.
The API said gasoline supplies fell by 720,000 barrels against expectations for a 1 million barrel increase; distillate stocks rose 1.5 million barrels, which was near expectations.
West Texas Intermediate crude oil settled 9 cents lower to 48 cents higher with September at $20.69 a barrel; heating oil was .05 cent to .50 cent higher with August at 57.11 cents gallon; unleaded gasoline was .28 cent lower to .76 cent higher with August at 65.60 cents a gallon.
Strong cash markets gave cattle and pork futures a boost on the Chicago Mercantile Exchange. All deliveries of frozen pork bellies rose the permitted daily limit of 2 cents a pound.
Live cattle futures ended .35 cent to .75 cent higher with August at 78.32 cents a pound; feeder cattle were .30 cent to .65 cent higher with August at 89.82 cents a pound; live hogs were .42 cent to .95 cent higher with August at 61.22 cents a pound; frozen pork bellies were 2 cents higher across the board with August at 51.22 cents a pound.
Soybean futures rose moderately on the Chicago Board of Trade amid continuing signs of strength in the cash market. Wheat and corn futures fell.
Wheat futures settled 3 1/2 cents to 6 cents lower with September at $2.88 1/4 a bushel; corn was unchanged to 3/4 cent lower with September at $2.60 1/4 a bushel; oats were 1 cent to 1 1/2 cents higher with September at $1.29 1/2 a bushel; soybeans were 3 cents to 6 1/2 cents higher with August at $5.94 1/2 a bushel.