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Market Nuggets: Standard Bank Looks For Platinum Group Metals To Keep Trending Higher
19 November 2010, 11:15 a.m.
By Allen Sykora
Of Kitco News
http://www.kitco.com/

(Kitco News) -- Standard Bank says the general trend for platinum group metals remains higher, and it revised upward its palladium target and now looks for close to $780 by end of the first quarter. The bank calls for platinum to trade on a sustainable basis above $1,800 soon, not because of strong demand but due to the cost of production. “In contrast, palladium demand remains in place,” Standard says. The bank cites data showing palladium exports from Switzerland (where PGMs are stored) were 97,000 ounces in October, the sixth straight month of outflows and the largest export number since July. “For the greater part of 2010, the outflow of metal was inflated by metal moving to London vaults for loco London settlement,” Standard says. However, this movement largely ended in September. “Therefore, the strong palladium export figures in October…indicate demand for palladium remains strong despite the rising price of the metal.” There are some concerns, such as potential volatility from monetary tightening in China. Still, Standard concludes that “the general trend for PGM prices remain higher.”


By Allen Sykora of Kitco News; asykora@kitco.com




Market Nuggets: Barclays: Decline In Copper Prices Creates Buying Opportunity
19 November 2010, 9:08 a.m.
By Allen Sykora
Of Kitco News
http://www.kitco.com/

(Kitco News) -- The recent sell-off in copper has created a buying opportunity, say analysts with Barclays Capital. As of a Barclays research report issued earlier Friday, copper had shed $405 in a week. “The recent massive sell-off has been, in our opinion, an overreaction to macroeconomic concerns about sovereign debt (Europe) and overheating (China), which has had market players tied to their seats and biting their nails,” Barclays says. This also pulled down other commodities and equities, the bank says. However, copper has turned “undervalued” in a market with healthy supply/demand fundamentals that include a low stocks-to-consumption ratio, robust Chinese imports and a broad-based recovery in activity, Barclays says. The bank looks for the price dip to be “short-lived.”


By Allen Sykora of Kitco News; asykora@kitco.com




Market Nuggets: Barclays: Investment Demand To Be Key For Silver Market
19 November 2010, 9:06 a.m.
By Allen Sykora
Of Kitco News
http://www.kitco.com/

(Kitco News) -- Silver’s fortunes could hinge on whether investment demand continues, says Barclays Capital. The bank shares the view of the consultancy GFMS, which this week said it looks for silver supply to grow, led by an increase in mine output. Both also look for an increase in fabrication demand (GFMS looks for a 10% rise, while Barclays expects 8.9%). Thus, the market will be relying upon investment demand to take up any surplus. “Investor appetite remains healthy given the elevated ETP (exchange-traded product) holdings and the growing strength in coin sales,” Barclays says. “We would expect fabrication demand to provide support below $20/oz and would expect mine supply to continue to grow even if silver prices fell below $15/oz, thus silver could be subject to sharp corrections should investor demand turn sour before fundamentals would cushion prices.”


By Allen Sykora of Kitco News; asykora@kitco.com




Market Nuggets: Commerzbank: Exchange-Traded Fund Demand Helps Silver, Palladium
19 November 2010, 8:59 a.m.
By Allen Sykora
Of Kitco News
http://www.kitco.com/

(Kitco News) -- Silver and palladium have gained almost 10% and 13% since their mid-week low, says Commerzbank in a research note. This coincides with “high inflows” into exchange-traded funds, Commerzbank says. The world’s largest silver ETF, iShares Silver Trust, recorded inflows of around 55 tons in the past three days, the bank says. The palladium ETFs tracked by Bloomberg increased their holdings by 36,100 ounces in the same period of time. However, “there has clearly also been some shifting within the precious metals,” Commerzbank adds. It notes the world’s largest gold ETF, SPDR Gold Trust, reported outflows yesterday. Ireland seems willing to accept financial aid, which lowered risk aversion a little, the bank says. Still, gold is “relatively stable” in the face of this, at just under $1,360 a troy ounce, the Commerzbank adds.


By Allen Sykora of Kitco News; asykora@kitco.com