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COMMODITIES : Silver, Gold Futures Lower; Other Markets Close Mixed

January 08, 1988|From Associated Press

Silver futures prices fell Thursday as traders took profits after two days of sharp gains, but analysts said the setback would probably be short lived.

On other markets, livestock and meat futures moved higher; most energy futures retreated; grains and soybeans were mixed, and stock index futures were higher.

Profit taking sent the actively traded March silver contract down 13.5 cents on New York's Commodity Exchange, but silver is expected to remain strong, said Howard Levine, an analyst in New York for Shearson Lehman Bros.

Levine said the precious metals have been responding to a generally stronger tone in the commodities market, indicating that metals traders foresee higher inflation in the months ahead.

Precious metals often are used as a hedge against inflation.

Gold futures also retreated on the Comex, continuing this week's pattern of following silver prices.

Gold settled $2.20 lower, with the contract for delivery in March at $485.70 an ounce; silver was 12.8 cents to 13.9 cents lower, with March at $7.01 an ounce.

Pork futures jumped their daily limits at the opening on the Chicago Mercantile Exchange and remained that way throughout the session in reaction to an Agriculture Department report that showed a smaller than expected expansion of the nation's hog herd.

"A lot of people are expecting hogs and bellies to be limit up again tomorrow," said Charlie Richardson, an analyst in Denver for Lind-Waldock & Co.

The report, issued Wednesday, estimated that the nation's hog herd had grown by 6% from December, 1986, to December, 1987. The market had been expecting the report to show a 10% increase.

Cattle futures also advanced sharply, supported both by the pig crop report and by a reduction in cattle slaughters due to a winter storm in the Great Plains states, Richardson said.

Live cattle settled 0.45 cent to 1.18 cents higher, with February at 65.90 cents a pound; feeder cattle were 0.50 cent to 1.15 cents higher, with January at 79.32 cents a pound; live hogs were 1.50 cents higher across the board, with February at 44.97 cents a pound, and frozen pork bellies were 2 cents higher across the board, with February at 54.15 cents a pound.

Corn was supported by expectations that a meeting in London between U.S. and Soviet agriculture officials would produce an agreement for a large corn sale to Russia, analysts said.

Profit taking dominated the wheat and soybean pits, said Walter Spilka, an analyst with Smith Barney, Harris Upham & Co.

Stock index futures surged near the close at the Chicago Mercantile Exchange as the dollar shook off some weakness against major foreign currencies and resumed its rally.

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