Metals Rise on Brighter Economic Outlook
Source: Associated Press (2/1/11)
"Auto factories will place more orders for palladium and platinum this year."
Strong corporate earnings and rising stock indexes seemed to convince investors that demand will strengthen in coming months for metals, such as palladium, used in auto parts and other manufactured goods.
While the economic news is still far from glowing, a moderate uptick in auto sales reported Tuesday was enough to stoke optimism that auto factories will be placing more orders for palladium and platinum this year, said James Steel an analyst with HSBC in New York.
Automakers reported a rise in U.S. car and truck sales in January, with General Motors reporting a 23% increase and Toyota Motor Sales USA Inc. reporting a 17.3% increase compared to last year.
While the results weren't spectacular, they pointed toward improvement through the year, Steel said.
"The trajectory is still upward," Steel said. At the same time, strong corporate earnings reports bolstered metal prices as well as stock prices. The Dow Jones Industrial Average gained over 148 points, or 1.25% to close at 12,040.16. The NASDAQ and the Standard and Poor's 500 finished higher, as well.
April platinum rose $32.10 to $1,833 an ounce, while March palladium gained $3.45 to $823.55 an ounce. Copper for March delivery rose more than $0.08 to settle at ~$4.56/lb.
Precious metals also rose. Gold for April delivery gained $5.80 to close at $1,340.30 an ounce, while silver for March delivery rose ~$0.35 cents to settle at $28.514 an ounce.