London | Thursday
PLATINUM opened at its highest for nine months in Europe on Thursday as speculators rushed to cover amid tightening lease rates and fears over a second strike at the world’s biggest precious metals refinery in South Africa.
Platinum built on gains made in Asian trade overnight to begin at $560/565 a troy ounce, equalling levels last seen in mid-July 2001, when values momentarily rose to $575 at their peak.
Platinum prices initially bounced during Asian business as players who had sold the market short rushed to cover positions after a jump in futures prices in New York.
”Basically it was brought in Asia overnight and this has filtered through to this morning — there is also steady industry demand, which is creating support for the market,” a trader said.
Platinum, a key component in autocatalysts used to clean noxious exhaust fumes, has been rising steadily since January as the market has tightened on demand from the motor industry and jewellery fabricators, especially from China.
A rise in nearby lease rates in New York to 12% on Wednesday, double the level last Thursday, helped to spook short-position holders worried over the prospect of a second strike at South Africa’s Anglo American Platinum precious metals refinery next month, traders said.
On Monday workers at the plant called off a strike over a medical dispute that had sent platinum prices higher, but threatened broader action in mid-May.
”The charts look very bullish for platinum, especially with the tightening forwards overnight — and of course the threat that the strike may start again is a supportive factor,” one trader said.
By 0641, spot platinum had slipped from its opening highs to $558/563 but was up from a close of $540.50/560.50 in New York on Wednesday. – Reuters