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NY precious metals gain confidence, close steady

NEW YORK: Nymex platinum group metals ended the week with mixed results while Comex gold and silver both posted gains by the end of their sessions.

Platinum and palladium have been trading under volatile conditions, leaving the market cautiously nervous. With most of the fundamental news now factored into the market, light profit taking and trade interest on the lows was noted.

Active June palladium ended off $8.90 to $650.00 an ounce with trade buying and profit taking giving the market underlying support. April platinum ended up $11.00 to $463.50.

In the news, reports that Russia signed export quotas for 2000 had minimal effect on prices. The market has largely remained illiquid due to the absence of Russian metal.

Russia produces 20 percent of all platinum and 65 percent of world palladium. Palladium had come under great demand from the growing auto industry which saw palladium as being more efficient in auto catalysts than the previously favoured platinum.

Russian metals giant Norilsk Nickel has been the only firm that recently has been able to export palladium, under a 10-year export quota where it sells mostly under long-term contracts directly to consumers.

The other news that has embedded itself into the market came from the Tokyo Commodity Exchange (TOCOM) which took measures by freezing trade while Nymex raised margins several times in response to market volatility.

"Since they froze the price in TOCOM, that has taken a lot of the steam out of the longs that have been pressuring the market," said one refiner.

"A lot of the speculation that was in there has been removed to some extent. The last couple of days, there's more confidence that the Russians will get over their export quota problems. People are thinking the end is there and just taking some profits."

Meanwhile, Comex May silver posted a 9.0-cent gain amid some fund short covering action to end at $5.153 an ounce, trading between $5.06 and $5.17. Spot silver was quoted at $5.04/06, compared to the fix at $5.002 and the previous close at $5.01/03.

"Silver had a pretty nice rally and gold is still languishing," said Scott Meyers, technical analyst with Pioneer Futures.

"(Silver's move) by no means signals a major turn in trend but silver looked good. Gold tried but gave back most of its gains on the close. Although gold did post a minor reversal pattern, it's not enough to believe that we've turned the corner."

Comex April gold ended up a mere $0.60 at $290.30 an ounce, trading from $289.20 to $292.20

Spot bullion was last quoted at $288.20/9.20, compared with Thursday's New York close of $287.40/8.40 and the London fix at $288.50.

News that the UK Treasury said Friday that it intended to sell 150 tonnes of gold in a fresh series of six auctions starting in May had little impact on Comex trading.

The new sales will follow the final auction, being held on March 21, under Britain's current gold auction plan which will dispose of a total of 125 tonnes of reserve gold.-Reuters