This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Platinum, Palladium Uptrend to Continue

NEW YORK ( TheStreet) -- Platinum and palladium metal prices could continue to increase on supply constraints and on increasing auto sales in China and India.

Over the past three trading sessions, palladium and platinum for spot delivery on NYMEX gained 5.3% and 1.5%, respectively. Tracking the metals' performance, palladium ETF ETFS Physical Palladium Shares ETF (PALL) and platinum ETF ETFS Physical Platinum Shares ETF (PPLT) registered similar gains.

Among stocks, Stillwater Mining (SWC - Get Report), North American Palladium (PAL) and Platinum Group Metals (PLG) gained 9.7%, 5.4% and 2.8%, respectively.

Palladium group metals (PGMs) production is set to decline because around 8,000 mineworkers at the South Africa-based Northam Platinum will go on strike starting Monday over wage increments. The company did not agree to National Union of Mineworkers' demand for a 15% increase in wages and other allowances. The company produced 321,745 ounces of PGMs in the year to end-June. Supply disruption at Northam will widen the PGM deficit, pushing up the prices.

Unlike other countries, car sales in India have been trending up and are hesitant to take a break despite price hikes. Car sales of Ford (F - Get Report) grew 220% year-over-year in August, leading the pack of carmakers in India. Other leading car producers Maruti Suzuki, Tata Motors (TTM), Honda Motor (HMC - Get Report), Toyota Motor (TM - Get Report) and General Motors registered handsome growth rates of 32%, 45%, 39%, 26%, and 34%, respectively, in August. Several new models, easy financing and booming economy are the prime reasons for the continued outstanding performance of India car sales.

Meanwhile, China surpassed the Indian car market growth rate in August, as China's car sales surged around 56% year-over-year to 1.21 million units. This robust growth can be attributed to the government's incentives for small fuel-efficient cars.

U.S. auto sales declined around 21% year-over-year in August. The year-ago month was an exception since the government's "cash for clunkers" program supported sales numbers. Similarly, car buying in France, Italy and Spain dropped in August as government incentives were phased out.

Sluggish growth in Europe's auto sales will likely have more impact on platinum than on palladium as cars in Europe are mostly gasoline-based, which consume more platinum. However, cars in China and the U.S. - the world's top two car producing countries -- are mostly diesel-based, which use more palladium. Hence, robust U.S. and China manufacturing numbers for August which were released on Wednesday had a greater impact on palladium than platinum.
Karvy Global Services (, a subsidiary of the Karvy group (, provides specialized research in asset classes including stocks, mutual funds and insurance to leading Wall Street firms.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
PAL $0.04 -10.48%
F $13.56 0.00%
HMC $26.96 0.00%
PLG $3.32 0.00%
TM $101.70 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs