PRECIOUS-Palladium at 3-1/2 year high after S.Africa wage talks fail

Tue Jun 10, 2014 4:37pm EDT

Related Topics

* Impala won't budge on offer as S.Africa strike continues
    * Expected Russian supply woes, demand boost palladium
    * US bond manager PIMCO bullish on gold
    * Coming up: US federal budget Wednesday

 (Updates market activities)
    By Frank Tang and Clara Denina 
    NEW YORK/LONDON, June 10 (Reuters) - Palladium jumped to its
highest in nearly 3-1/2 years on Tuesday, while platinum also
rallied after talks to resolve a five-month strike in top
producer South Africa collapsed.
    Impala Platinum, the world's second-largest
platinum producer, said on Tuesday that it had "exhausted all
its financial means" in its wage offer. 
    Wage settlement talks between South Africa's main mine
workers' union and major platinum producers broke down on
Monday, dashing hopes for an end to a crippling five-month
strike.  
    Palladium, of which South Africa is the
second-biggest producer, hit its highest level since February
2011 at $854 an ounce. It was last up 1.7 percent at $852.18 as
of 4:10 p.m. EDT (2010 GMT).
    "For palladium, it is ... the possibility of a shortfall in
supply from number one producer Russia and strong demand from
the physical side on the back of higher car sales and also
investor demand," Commerzbank analyst Eugen Weinberg said.
    Platinum rose 2.2 percent to $1,475.75 an ounce after
hitting its highest since May 26 at $1,481.50.00.
    The strike has halted production at mines that normally
account for about 40 percent of global platinum output.
        
    GOLD RISES TOO
    Spot gold rose 0.7 percent to $1,260.30 an ounce.
U.S. COMEX gold futures for August delivery settled up
$6.20 at $1,260.10.
    "You have the stock market at an all-time high. Investors
are going to have to find a place to diversify their money and
the precious metals are very under-owned," said COMEX gold
options floor trader Jonathan Jossen.
    U.S. bond manager PIMCO said on Tuesday that gold should
benefit from rising inflation and lower real interest rates.
    "We find gold attractive at current valuations," Mihir
Worah, PIMCO's deputy chief investment officer said in a note.
    Silver rose 0.8 percent to $19.17 an ounce.
4:10 PM EDT     LAST/    NET   PCT      LOW    HIGH  CURRENT
               SETTLE   CHNG  CHNG                       VOL
US Gold AUG   1260.10   6.20   0.5  1250.10 1263.80   99,963
US Silver SEP  19.210  0.102   0.5   19.015  19.275   11,813
US Plat JUL   1482.20  27.90   1.9  1451.40 1485.80   15,183
US Pall SEP    854.55  12.95   1.5   841.05  855.75    5,780
Gold          1260.30   8.72   0.7  1250.76 1263.00         
Silver         19.170  0.150   0.8   19.010  19.230
Platinum      1475.75  31.85   2.2  1451.60 1481.50
Palladium      852.18  14.28   1.7   842.80  854.00
TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
               CURRENT   30D AVG  250D AVG   CURRENT     CHG
US Gold        120,942   160,805   165,454     12.91   -0.23
US Silver       54,281    43,249    55,154     17.34   -0.32
US Platinum     17,374    13,000    12,307     17.87    1.15
US Palladium     5,853     8,885     5,825     18.69    0.42  

 (Additional reporting by A. Ananthalakshmi in Singapore;
editing by Jason Neely and Pravin Char; Editing by Diane Craft
and Andre Grenon)
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