A resurgence of commercial and speculative buying pushed platinum futures prices to a three-month high Tuesday on the New York Mercantile Exchange and boosted gold and silver futures as well.
On other markets, crude oil futures tumbled, soybeans retreated, grains were mixed, cattle futures advanced and pork futures fell.
Platinum settled $4.80 to $5.30 higher, with the contract for delivery in April at $551.50 an ounce, the highest close since the market’s mid-December collapse from levels near $600.
On New York’s Commodity Exchange, gold settled $5.20 to $5.80 higher, with April at $395.70 an ounce; silver finished 6.5 to 6.8 cents higher with May at $5.965 an ounce.
Platinum’s slow climb back from less than $520 an ounce reflects both renewed commercial demand from the Far East and the gradual return of bullish speculators who bailed out of the market after Ford Motor Co.'s Dec. 14 announcement that it had developed a catalytic converter that did not use platinum as a primary ingredient.
The use of platinum as a chemical catalyst in automobile pollution-control devices accounts for about a third of global platinum consumption.
With Ford still testing its new converters, the platinum market’s attention has gradually returned to the existing tight-supply situation, which is expected to persist into the 1990s.
Yet platinum traders remain cautious, an attitude underscored by Tuesday’s activity. The April contract traded as high as $559 during the session, then dropped back as traders lost their nerve and took profits.
“Still, you’ve got to give the market some credit just for getting up there,” said Craig Sloane, a metal market analyst with Smith Barney, Harris Upham & Co. in New York.
In contrast, the gold and silver markets closed near their highs, indicating a greater willingness among traders to gamble that prices of those metals will continue to rise.
Energy Futures Slide
Peter Cardillo, commodity trading adviser with Josephthal & Co. in New York, said gold’s performance Tuesday “tells me we’re in for a short-term pop to the $400 area,” a level the gold market has not seen since late January.
Tuesday’s sharp drop in energy futures prices on the New York Mercantile Exchange was attributed to technical factors rather than to a change in the bullish fundamentals that have recently driven crude oil futures to prices approaching $19 a barrel.
Those positive factors include agreements by non-OPEC oil-producing countries to reduce their oil output in a concerted effort to boost prices.
West Texas Intermediate crude oil settled 23 to 37 cents lower, with April at $18.30 a barrel; heating oil was 0.35 to 0.57 cent lower, with April at 51.08 cents a gallon, and unleaded gasoline was 0.18 to 0.54 cent lower, with April at 51.41 cents a gallon.
Prices of soybean futures fell moderately on the Chicago Board of Trade, reflecting concerns about the imminent arrival of new supplies from the record-large Brazilian soybean crop.
Grain futures finished narrowly mixed as spillover selling from the soybean complex was offset by bullish forecasts for a week of relatively dry weather in the Plains and Midwest, analysts said.
Wheat settled 2.50 cents lower to 2.75 cents higher, with March at $4.34 a bushel; corn was 1.50 cents lower to 2 cents higher, with March at $2.7825 a bushel; oats were unchanged to 1.50 cents higher, with March at $2.10 a bushel, and soybeans were unchanged to 6.25 cents lower with March at $7.6425 a bushel.
Cattle futures moved moderately lower on the Chicago Mercantile Exchange in technically inspired selling, while pork futures rose on expectations for lighter marketings and higher cash prices.