Platinum Futures Extend Decline on Equities Slump, U.S Slowdown

By Dave McCombs

June 25 (Bloomberg) -- Platinum futures in Tokyo headed for their longest losing streak in 10 months as declining equity markets and a U.S. sales warning from Toyota Motor Corp. prompted investors to quit the metal used for making auto catalysts.

Platinum fell for a fifth day, tracking a five-day slide in Japan's benchmark Nikkei 225 Stock Average and the MSCI Asia Pacific Index. A decline in U.S. consumer confidence to a 16-year low and a record drop in housing prices there also prompted some investors to shift from commodities to cash, said Kazuhiko Saito, a commodity strategist at Interes Capital Management.

``The economic data is bad and that's putting pressure on the platinum market,'' Saito said by phone today in Tokyo. ``Investors are going into cash from commodities.''

Platinum for April delivery in Tokyo plunged 166 yen, or 2.4 percent, to 6,806 yen a gram ($1,964 an ounce) on the Tokyo Commodity Exchange at the 11 a.m. local time break. The most- active contract has declined 3.8 percent in the past five days.

Metal for immediate delivery fell $10 to $2,011 an ounce the same time, a 0.5 percent drop from late yesterday in New York.

The Nikkei 225 Stock Average dropped 1.5 percent, to 13,644.97 as of 11 a.m., taking its five-day decline, the longest this year, to 5.6 percent.

Toyota may cut its 2008 sales target after rising gasoline prices and the slowing U.S. economy slashed demand for large cars and pickups, the company said yesterday.

The New York-based Conference Board's confidence index for June yesterday dropped to 50.4, lower than expected and a 16-year low. Home prices in 20 U.S. cities dropped 15.3 percent in April from a year earlier, according to S&P/Case-Shiller, the most since the group began collecting data.

To contact the reporter for this story: Dave McCombs in Tokyo at dmccombs@bloomberg.net.