platinum due for a bounce

ETF Securities' platinum holdings rise 23 percent
Mon Dec 1, 2008 12:48pm GMT

LONDON, Dec 1 (Reuters) - ETF Securities said on Monday the amount of metal it holds to back its physical platinum exchange-traded commodity PHPT.L rose 23 percent or 31,540 ounces in the week to November 28.
The ETC now holds 166,162 ounces of platinum, against 134,622 ounces on November 21, ETF Securities' head of research and investment strategy Nicholas Brooks said. Holdings rose to a high of over 400,000 ounces in July.
Platinum prices have tumbled around 65 percent from the all-time highs of $2,290 an ounce they reached in March, on concerns about the outlook for carmakers which account for around half of global platinum demand.
Spot platinum was trading at $807.50/827.50 an ounce at 1219 GMT on Monday.
However, with the market's sharp fall and new mine supply likely to be under threat from low prices, investors may be starting to believe the market is bottoming out, Brooks said.
"Even if the medium term outlook for platinum and palladium sales are pretty weak given what is going on in the global auto sector, I think some people may believe that we are due for a bounce," he said.
"Certainly the appearance of some stability of equity markets over the last week or so, relative to the way they have been moving over the past month or so, means some people may be positioning for a bounce in platinum prices," he added.
Holdings of the company's gold-backed ETC PHAU.L also rose 12 percent in the same period to 1.707 million ounces, he added. (Reporting by Jan Harvey; Editing by Sue Thomas)