April 13 (Bloomberg) -- Platinum climbed to a six-month high in New York on speculation that demand for the metal will rise in Japan after the government outlined a record stimulus package to help revive the country’s economy. Palladium gained.

Japan’s Prime Minister Taro Aso’s 15.4 trillion yen ($153 billion) plan aims to revive an economy headed toward the worst recession since World War II. Including financial measures and guarantees, the effort will reach 56.8 trillion yen, Aso said in Tokyo on April 10. Platinum and palladium are mostly used in auto and truck pollution-control parts and in jewelry.

“The Japanese came out with a stimulus package and that is a big factor in the platinum market,” said Stephen Platt, a commodity analyst at Archer Financial Services Inc. in Chicago.

Platinum futures for July delivery gained $51.70, or 4.3 percent, to $1,247 an ounce on the New York Mercantile Exchange. The most-active contract earlier rose to $1,252 an ounce, the highest since Sept. 24.

The metal may rise to $1,320 an ounce by late next month, Platt said. The most-active platinum contract has soared 32 percent this year, after tumbling 38 percent in 2008.

Palladium futures for June delivery climbed $11.25, or 4.9 percent, to $242.35 an ounce on Nymex. The metal gained 2.7 percent last week and has surged 28 percent this year.

Some investors buy platinum and palladium as alternatives to holding stocks, bonds and currencies.

“It’s up on risk appetite,” said Tom Pawlicki, a metals analyst at MF Global Ltd. in Chicago. “Chinese car sales were strong in March; prospects for U.S. car sales are improving.”

China Car Sales

China’s passenger-vehicle sales rose 10 percent in March from a year earlier to a record 772,400, the China Association of Automobile Manufacturers said April 9. Demand for minivans surged 40 percent last month in China as the government began giving out 5 billion yuan ($731 million) in subsidies to help rural residents buy vans and light trucks.

Platinum also gained support from a plan by a San Francisco-based unit of ETF Securities Ltd. to sell bullion- backed platinum trust units, fueling speculation that investment demand for the metal will rise. ETF Securities USA LLC has registered with the U.S. Securities and Exchange Commission for the sale, without specifying an offering date.

“Fundamentally, new ETFs coming out, coupled with expectations for a turn in the automotive sector, are adding support,” said John Gross, the president of J-E Gross & Co., a metals-industry consulting company. Gross, who is also publisher of the Copper Journal in Cranston, Rhode Island, has traded metals for more than three decades.

“After falling more than $1,400 during the second half of 2008, platinum was severely oversold,” Gross said. “Short covering, coupled with new longs coming into the market during the first quarter, has enabled the price to rebound some $400 from the low of $800, adding to upward momentum and attracting further buying. The market is now testing resistance at the $1,200 level.”

To contact the reporters on this story: Halia Pavliva in New York at hpavliva@bloomberg.net.

Last Updated: April 13, 2009 14:23 EDT