NY precious metals end mostly higher
NEW YORK, July 11 (Reuter) - COMEX and NYMEX precious ended mostly higher Friday, on fund shortcovering in both gold and platinum group metals (PGMs), but volumes were only moderate.
``Silver saw fund selling in Europe overnight, but gold ended near the top of the week's range, helped by some physical buying around $315.00 earlier in the week and some fund shortcovering,'' Refco New York analyst Jim Steel said.
``Platinum and palladium may also have already anticipated the Russian return to the market and shortcovering may push prices higher next week also,'' he said.
COMEX August gold ended up $1.40 at $322.20 an ounce, after climbing above Thursday's high at $322.20 late in the day, and edging up to a session high at $323.10.
Earlier news the U.S. June Producer Price Index (PPI) had fallen 0.1 percent, the sixth consecutive monthly drop, had little impact, traders said.
But the expiry of COMEX August gold options at the close also had little impact, as gold's slide this week had taken prices well below the active strike prices, analysts said.
The COMEX August/December spread narrowed further to around $3.20 an ounce, from $3.50 Thursday and $4.40 last Thursday before the Independence Day holiday weekend.
In the bullion market, spot gold ended quoted $321.00/60, compared to the London Friday afternoon fix at $319.50 and the New York close Thursday around $319.60/10.
Gold fixed at a 12 year low early Wednesday this week at $315.75 in London, after news of a further central bank gold sale last week. The Reserve Bank of Australia sold 167 tonnes of gold, two-thirds of its reserves, with deliveries occurring in June, August and September this year.
While further shortcovering may ensue next week, as the gold market works off its technically oversold condition, sentiment remains bearish, analysts said.
Long-term cycle analysts seen gold staying weak into October this year, when the end of a 60 year cycle may present a major buying opportunity for gold equities in particular.
``There is no question in our minds that gold stocks will be a better buy than either gold or silver once the final lows are in place,'' Gann-cycle analyst and ``Past, Present, Futures'' newsletter editor, James Flanagan, said.
Gold and silver equities did relatively better than gold this week, with the Philadelphia Stock Exchange's index of gold and silver mining stocks (.XAU) up 2.46 pct at 93.99 at the close Friday, up from a three year low at 85.79 Monday.
Meanwhile the gold/gold-stocks-index ratio (XAU=/.XAU) slipped to 3.41-to-1, after the ratio saw a 12 month high of 3.66:1 in April.
COMEX September silver ended down 2.3 cents at $4.360 an ounce, after running into some resistance near $4.40 an ounce. The September/December spread narrowed further to 5.00 cents an ounce.
But NYMEX October platinum jumped $14.00 to end at $395.70, and spot platinum in the physical market closed higher quoted around $406.00, recovering from the week's low around $394.00 an ounce.
NYMEX September palladium ended up $4.60 at $153.00.
The physical platinum and palladium market remained tight, with one month platinum lease rates offered around 50 percent and one month palladium lease rates around 80 percent Friday.
Japanese trade houses reported this week that some Russian palladium had arrived in Japan, but platinum was not due to arrive until next week.
Newswire reports also suggested the Russians had decided not offer platinum in the spot market due to limited supplies of the metal in Russia.
Meanwhile, Tokyo Commodity Exchange (TOCOM) palladium short positions, amounting to 61 tonnes, remain to be covered, while traders wait for the market to stabilize after the resumption of Russian PGM exports this week.
Russian PGM exports had been suspended for six months. Russia supplies about 60 percent of the world's palladium and 20 percent of its platinum. |
