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Comex silver ends higher in catch-up day

NEW YORK: Silver futures jumped on Thursday, responding with a day's lag to midweek surges in gold, base metal and oil prices, but meeting strong trade selling at the highs, dealers said.

"Silver I think was a delayed reaction to everything. Between oil, gold, copper and all it had some stuff to do," said a bullion dealer.

Commission house buying kicked in after a weak open on the Comex, where March silver rose 8.4 cents to $5.257 an ounce at settlement, having moved from $5.155 to a high of $5.285.

Though silver -- considered almost a base metal -- rallied, industrial metals came off their highs on Thursday. Comex March copper ended down 0.95 cent after surging to contract highs Tuesday and Wednesday, when London prices hit their highest in more than two years.

London aluminum also backed off from Wednesday's 29-month record. But heating and crude oil futures piled on more gains in New York Thursday, striking new 9-year highs as the US Northeast fell under the winter's first heavy blanket of snow.

Spot silver was quoted late at $5.20/22 an ounce, up from the $5.13 fix in London and Wednesday's New York close at $5.14/17.

Dealers said bullion prices still must hurdle the $5.24/$5.25 area to provide a bullish signal. Dealer selling capped the rise but futures traders said the move over $5.26 was constructive.

Meanwhile February gold fell $1.00 to $289.30 an ounce, in a range of $288.40 to $290.70. Spot bullion last fetched $288.10/8.90, near the late fix at $288.10 and down from the previous close at $289.15/75.

Prices backed off after upmoves on Tuesday and Wednesday sputtered just above the $290 level. Dealers reported overnight Australian producer selling capped the market, as did reluctance to hold gold going into Britain's fourth bimonthly gold auction on Tuesday.

The UK will sell 25-tonnes next week under a planned 415-tonne reduction of gold reserves to 300 tonnes. But the market looks set to shrug off an event which last year crippled some miners and threw the markets into turmoil.

The upcoming sale finds the gold mart in a slump, with prices sandwiched in a less-than-$15 range between steady physical demand and producer and central bank selling, while livelier energy metal and softs markets captivate investors with solid trends.

Nymex April platinum closed down $4.70 an ounce at $423.50, unable to hold morning firmness from Wednesday's contract high and shaking off a $8.95 rise in March palladium, which settled at $451.70.

"In the palladium, there was evidence of Russian selling overnight," said another dealer. "We went down this morning but there is just still very good consumer demand out there. Every time the Russians come in to sell, they seem willing to take it up."-Reuters