FINANCIAL MARKETS : Commodities : Precious Metals Gain as Stocks, Bonds Decline

Precious metals futures advanced Thursday, as the dollar, bonds and stocks continued their sharp declines, but finished off their highs as the financial markets tended to firm up.

On other markets, pork futures retreated while cattle were higher; grain and soybeans were mixed, and oil slightly higher.

“Initially, precious metals responded to yesterday’s (Wednesday’s) bullish scenario,” said Bette Raptopoulos, an analyst in New York with Prudential-Bache Securities.

She said the financial markets began improving on the report that the Federal Reserve dumped more money into the system through repurchase agreements, under which the Fed buys securities with an agreement that the seller buy them back in the near future.

However, metals trading closed before the stock market took another severe dip late in the session.

The advances in platinum trading at the New York Mercantile Exchange held up best, with gains of $7.30 to $13.30 and the October contract settling at $589 an ounce.

On the Commodity Exchange in New York, silver was 4.6 cents to 5 cents lower with December falling from the day’s high of $8.07 to settle at $7.84 an ounce. Gold was $1.50 to $2.80 higher with December at $467.80 an ounce, down from the day’s highs of $472.50.

Pork futures declined while cattle advanced on the Chicago Mercantile Exchange.

Lower cash hog prices in the country along with increased receipts put pork futures under pressure, said Charlie Richardson, an analyst in Denver with Lind-Waldock.

Deteriorating weather conditions forced some cutback in harvest work and gave farmers time to load up some hogs for market, he said.

“Most wholesale pork products were going for a lower price, reflecting the larger kills we’re seeing now,” Richardson said.

While pork futures were moving down, cattle was gaining in value.

“Basically, people are looking at a firmer wholesale trade,” Richardson said. And feedlots are expected to have fewer animals ready to market next week than they had this week.

Live cattle settled unchanged to 0.75 cent higher with the October contract at 68.85 cents a pound; feeder cattle were 0.10 cent lower to 0.60 cent higher with October at 78.07 cents a pound; live hogs were 0.50 cent lower to 0.13 cent higher with October at 49.15 cents a pound, and frozen pork bellies were 0.20 cent to 0.98 cent lower with February at 56.92 cents a pound.

Wheat and soybean futures prices were mostly lower while corn was mixed on the Chicago Board of Trade.

Trading was subdued, but there was some concern that the government might free up some its wheat stocks by lowering prices, said Ted Mao, an analyst in New York with Shearson Lehman Bros.

A background factor lending some support to the market is India’s apparent plans for a shopping tour in this country.

“They might be taking corn, wheat or vegetable oil, or any combination of these,” Mao said.

Wheat settled unchanged to 2.75 cents lower with the December contract at $3.09 a bushel; corn was 0.50 cent lower to 0.25 cent higher with December at $1.875 a bushel; oats were 1.50 cents to 2 cents higher with December at $1.8975 a bushel, and soybeans were 2.75 cents lower to 0.50 cent higher with November at $5.4275 a bushel.

Energy futures were mostly higher on the New York Mercantile Exchange.

West Texas Intermediate crude oil was 2 cents lower to 7 cents higher with the November contract at $19.75 a barrel; heating oil was unchanged to 0.08 cent higher with November at 56.08 cents a gallon, and unleaded gasoline was 0.01 cent to 0.12 cent higher with November at 52.44 cents a gallon.

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