(Updates with quotes, prices)
By Atul Prakash
LONDON, May 9 (Reuters) - Platinum jumped 4 percent to a
seven-week high on Friday on investor buying ahead of the launch
of platinum exchange-traded notes (ETNs), while gold hit a
one-week peak on a weaker dollar and record high oil prices.
Investment bank UBS <UBSN.VX> will launch two ETNs offering
long and short trading strategies in platinum. ETNs, unlike
exchange-traded funds, do not purchase physical platinum to back
the number of shares sold.
According to CNBC television and NYSE Euronext exchange
data, the two ETNs -- UBS E-Tracs Long Platinum ETN <PTM.P> and
UBS E-Tracs Short Platinum ETN <PTD.P> -- will begin trading on
Friday on the NYSE Arca platform. []
"It won't have an impact on the availability of physical
metal nor on lease rates. Fundamentally you cannot justify the
kind of price move we have seen so far today," said Tom Kendall,
metals strategist at Mitsubishi Corporation.
But it offers another route by which U.S. mutual and pension
funds, which cannot directly invest in commodity derivatives,
can gain exposure to platinum, he added.
Spot platinum <XPT=> rose to a high of $2,095 an ounce
before falling to $2,069.50/2,189.50 at 1331 GMT, compared with
$2,008.50/2,028.50 in New York late on Thursday.
Dealers also reported platinum purchases in Japan and Europe
as auto makers stocked up for their second-quarter requirements,
but the metal was still more than $200 below a lifetime high of
$2,290 an ounce hit on March 4.
"People just read about the new products and started buying
platinum, but I think it's overdone here," said Wolfgang
Wrzesniok-Rossbach, head of marketing and sales at Heraeus, a
German precious metals trading group.
TOKYO FUTURES SURGE
Platinum's major industrial use is in making autcatalysts,
particularly diesel catalysts, as it helps clean environmentally
damaging fumes from exhausts. It is also used in jewellery.
In other markets, the most active Tokyo platinum contract
jumped by the daily 300 yen limit. The benchmark contract for
April 2009 delivery <0#JPL:> rallied to 6,703 yen per gram, but
still below a record of 7,427 yen hit on March 6.
"The launch of another ETF type product in the already tight
platinum market triggered flurries of buying interest
yesterday," said James Moore, analyst at TheBullionDesk.com.
"Given the already tight conditions and the market's
nervousness towards a deeper supply deficit, we could quite
easily see the metal set new highs," he said in a report.
Spot gold <XAU=> hit a one-week high of $889.80 an ounce,
supported by a weaker dollar against the euro and record high
oil prices. It was last quoted at $885.60/886.60, against
$881.40/882.60 in New York late on Thursday.
In the physical market, steady purchases from jewellers in
Indonesia, Thailand and Vietnam pushed up premiums for gold bars
to 80 U.S. cents an ounce to the spot London prices in
Singapore, from 75 cents last week <GOLD/ASIA1>.
But output and exports of jewellery from Italy, Europe's
biggest producer, would fall this year owing to high gold prices
and a weakening global economy, Stefano de Pascale, director of
Italian goldsmiths' body Federorafi, said. []
In other precious metals, gold futures for June delivery
<GCM8> on the COMEX division of the New York Mercantile Exchange
rose $4.70 an ounce to $886.80.
Silver <XAG=> fell to $16.80/16.86 from $16.85/16.91 an
ounce, while spot palladium <XPD=> was up at $434/442 an ounce,
against $430.50/438.50 an ounce.
(Reporting by Atul Prakash; editing by Editing by Peter
Blackburn)
