NEW YORK — Gold and platinum prices resumed their rally late Monday, spurred by continued fears that South Africa would retaliate against international sanctions by cutting exports of the metal.
Platinum for October delivery soared the $25-an-ounce trading limit to $548.10 on the futures market, its highest level since 1981. Gold futures closed at their highest levels in 2 1/2 years Monday, with October futures up $15.80 to $394.80 an ounce.
Earlier in the day, prices had edged back as speculators reaped profits from the recent gains and Wall Street analysts warned of further declines.
However, there was widespread speculation that South African President P. W. Botha would not announce any apartheid reforms in his speech today. That in turn could intensify U.S. congressional pressure for sanctions, analysts said.
Some traders warned that the day's gains were overdone, especially since South Africa has not retaliated against any other countries since imposing tariffs last week on Zambia and Zimbabwe.
"I think the concern is real," said Gail Levey of Shearson Lehman Bros. about market worries over South African retaliation as well as the possibility that unrest could disrupt platinum and gold production.
"But platinum rose $100 an ounce in less than a week and it is extremely difficult for any market to sustain that kind of an advance," she cautioned.
She and other analysts said a price pullback could be severe because speculative buying accounted for much of platinum's rise. However, Levey pegged strong near-term support at $500 an ounce in the October delivery contract.
"Unless South Africa retaliates against a major country, platinum will probably consolidate around the $530 to $550 area," said an analyst on the trading floor of the New York Mercantile Exchange, adding, "Any move toward $600 an ounce seems remote right now."
The rally in precious metals began with traders trying to secure supplies of platinum in case South Africa, under growing pressure over apartheid, should retaliate by cutting sales to countries that imposed economic sanctions.
Until last week's rise, which accelerated in New York on Friday, gold had drifted slowly upward from around $327 at the start of the year to between $350 and $360.
Platinum has a particularly volatile price because annual world supplies total only about 85 metric tons. About a third is used in the auto industry and another third in manufacturing jewelry, with other major users being the electronics and chemicals industry.
According to a report last month by Credit Suisse, one of the big three Swiss banks, South Africa will account for 70 tons of world supplies in 1986.