July 14, 2017
7 @ 7:00
Check back later today, after the close, for Daniel’s Den. BMR Morning Market Musings returns Monday.
1. Gold has traded between $1,216 and $1,224 so far today…as of 4:30 am Pacific, in this early edition of 7 @ 7:00, bullion is up $5 an ounce at $1,222 while Silver has added 11 cents to $15.78…base metals are mixed but Nickel has climbed 8 cents or 2% to $4.24…the U.S. Dollar Index has slipped one-tenth of a point to 95.65 and continues to look vulnerable given the likely prospect of a soon declining 200-day moving average (SMA)…
2. Gold has a chance to snap a 2-week losing skid today after closing last Friday at $1,212…keep an eye on a slew of U.S. economic data due later this morning, which will impact markets including Gold, including important CPI and retail sales data along with consumer sentiment and business inventory figures…holdings at SPDR Gold Trust, the world’s largest Gold-backed ETF, fell 0.43% to 828.84 tonnes yesterday from 832.39 tonnes on Wednesday…
3. Another strong week for the Canadian dollar which has much improved technicals these days and is closing in on near-term resistance at 80 cents after dipping as low as 73 cents in early May…the Bank of Canada’s decision on Wednesday to tighten monetary policy was supported by the central bank’s confidence that above-potential growth will absorb excess capacity in the economy…the central bank also raised its real GDP growth forecast for 2017 to 2.8% (from 2.6%) and for 2018 to 2% (from 1.9%)…not so positive is that after so many years of record low interest rates, Canadians have been borrowing at record amounts…this has pushed the ratio of debt to GDP to what some consider a precarious level…overall, Canadians’ debt-to-GDP ratio climbed to 354.5 in 2016, up 102 percentage points in just a decade…it has surged 36.3 percentage points in just the last 2 years as all domestic sectors borrowed more and saved less to sustain spending, even as low Oil prices dampened incomes…
4. WTIC prices are up 41 cents a barrel to $46.39 as of 4:30 am Pacific but concerns over supply continue to act as a cloud over positive news on demand…the International Energy Agency (IEA), in its closely watched monthly report released yesterday, says it now expects global demand to rise by 1.5% this year to 98 million barrels a day…the Paris-based adviser to governments and companies raised its 2017 demand forecast by 100,000 barrels a day, compared with a previous estimate last month, while predicting “similarly paced” growth for next year…investors remain more focused on the continuing global glut, however, and many analysts say this will continue to keep a lid on prices…in its report, the IEA also noted that output in June had increased from OPEC countries and other producers such as the United States…
5. The Venture continues to be restrained by its declining EMA(8), currently 757, as evidenced yesterday when the Index pulled back 5.5 points to 754 after enjoying its best session since late May on Wednesday…there are indications, though, that the recent bearish trend has peaked according to John’s latest short-term chart…a climb above the EMA(8) would confirm that…Jaxon Minerals (JAX, TSX-V), expected to release more sampling results shortly from surface exploration at its Hazelton VMS Property near Smithers, is up nearly 30% so far this week as it trades at multi-year highs…First Cobalt (FCC, TSX-V) just announced that it expects to be trading again in approximately 4 weeks following further Venture review of its acquisition of Australian-listed Cobalt One…FCC has also posted an interesting new video on its web site…today marks the official beginning of U.S. earnings season…JPMorgan Chase, one of multiple banks to report today, has just smashed Wall Street estimates…
6. GoldQuest Mining (GQC, TSX-V) jumped 7 cents yesterday to 42.5 cents after reporting 31.6 m grading 3.9 g/t AuEq in drill hole TIR-17–32, collared within approximately 100 m of discovery hole TIR-17–28 at its Cachimbo VMS target in the Dominican Republic…TIR-17–32 intersected strong Gold and base metal grades of 2.7 m grading 22.3 g/t Au, 52.8 g/t Ag, 3.1% Zinc and 0.46% Cu within a wider mineralized interval (discovery hole TIR-16–09 returned 5 m @ 14 g/t Au, 74 g/t Ag, 12% Zn and 1% Cu)…the VMS horizon is open along strike to the northwest and to the southeast as well as down dip to the east. “These results from the Cachimbo discovery follow-up holes are extremely encouraging and support the thesis that our Tireo belt land package has the potential to materialize into a multi-deposit mining district as these VMS systems often occur in clusters,” stated Bill Fisher, GoldQuest’s Executive Chairman. “These results are very important in advancing our understanding of this new discovery zone and will help us further explore this area.”
7. One company not affected so far by the severe fire situation in the southern interior of British Columbia is Happy Creek Minerals (HPY, TSX-V) which has mobilized for drilling at its 100%-owned Fox Tungsten Property 90 km northeast of 100 Mile House…at this point, fires are over 90 km away to the west of the Fox Property and no disruption of work has occurred…in late January, the company announced resources for 2 of 7 known zones that occur within the 10-km x 3-km mineral system…together, the Ridley Creek and BN zones contain 486,000 Indicated tonnes grading 0.82% WO3 (tungsten trioxide) and 361,000 Inferred tonnes grading 1.57% WO3…for a portion of the Ridley Creek zone, there are 329,000 Indicated tonnes of 0.76% per cent WO3 having a strip ratio of 3.3:1…the resources are open to expansion and the grades are comparable with the Cantung mine located in the Yukon/Northwest Territories, regarded as the highest-grade Tungsten mine in the Western world until it closed a few years ago…HPY closed at 17 cents yesterday and just completed $3 million in financings at 20 cents (hard dollar) and 26 cents (flow-through)…
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7 @ 7:00
Check back later today for an additional post and refer to the BMR comments section throughout the day for updates and helpful information. BMR Morning Market Musings returns Monday.
1. Gold has traded between $1,213 and $1,226 so far today…as of 3:30 am Pacific, in this early edition of 7 @ 7:00, bullion is up $2 an ounce at $1,222 while Silver is flat at 15.93…base metals are slightly higher with Copper trading at $2.68, Nickel at $4.17 and Zinc at $1.29…Crude Oil is 13 cents lower at $45.36 while the U.S. Dollar Index is unchanged at 95.75…
2. The latest IEA report on how the Oil market performed in June has been released…it found that Crude output rose by 720 million barrels a day in June across the world…within OPEC countries, output increased 340 million barrels…this was driven by higher production even in those countries subject to an OPEC-led deal to cut production…Saudi Arabia has increased its flows, the IEA said, as well as Libya and Nigeria who are not part of the production freeze. “Higher output from members bound by the production pact knocked compliance to 78% in June, the lowest rate during the first 6 months of the agreement,” the IEA said in the report.
3. A positive sign for the Oil market and the global economy, though climate change fanatics and fossil-fuel haters will cringe at this: China imported 212 million tonnes of Crude oil, or 8.55 million barrels per day (bpd), in the first 6 months of the year, up 14% vs. the same period in 2016, customs data showed today, making China the world’s biggest Crude importer ahead of the United States…the strong demand from China may help ease concerns about an ongoing fuel supply overhang (if only Canada could better serve the Chinese appetite for Crude, but most Canadian politicians are only interested in “saving the planet”)…
4. Fed Chair Janet Yellen expressed concern about the lack of inflation in the U.S. during her semi-annual testimony before Congress yesterday (she concludes today). “Temporary factors appear to be at work. It’s premature to reach the judgment that we’re not on the path to 2% inflation over the next couple of years. As we indicate in our statement, it’s something we’re watching very closely, considering risks around the inflation outlook.” The latest CPI data will be released Friday, and that’ll be an important number for the markets…
5. The Venture enjoyed its best session since late May yesterday, climbing 8.58 points to close at 758.48 – exactly at its EMA(8) which has provided stiff resistance since the beginning of June…significantly, the recent bearish trend appears to have peaked according to John’s latest short-term chart, and a climb above the EMA(8) would confirm that…Jaxon Minerals (JAX, TSX-V) enjoyed a powerful session yesterday, surging 7.5 cents to 39 cents to a new multi-year high on total volume (all exchanges) of 824,000…the TSX gave up an intra-day 150-point gain and fell 5 points while the Dow maintained its early gains and finished up 123 points at a new record high of 21,532…
6. Castle Silver Resources (CSR, TSX-V) may have made some interesting new surface discoveries in a 200-m radius around its past producing Castle mine in northern Ontario…the company is also targeting possible extensions of Cobalt/Silver veins noted underground from the first level of the mine where some bulk sampling has recently occurred, as an aggressive 2017 drill program has started from surface…underground sampling included values as high as 1.8% Cobalt and 8.6% Nickel…the Castle mine was the most recent richest Silver producer in the northern Ontario Silver-Cobalt Camp when it shut down around 1990 due to low Silver prices, not ore depletion…the Cobalt potential was never pursued despite ample visible Cobalt in the underground workings…CSR closed at 26.5 cents yesterday, just 3 pennies shy of its 2017 multi-year high…
7. Osisko Mining (OSK, TSX) released new results following yesterday’s close from its continuing drill program at its 100%-owned Windfall Lake Gold Project located in Urban township, Quebec…the current 400,000-m program combines definition drilling above the Red Dog intrusion, expansion drilling above and below Red Dog, and expansion/definition drilling in the Lynx deposit located immediately to the northeast of Windfall…significant new assays from 30 intercepts in 17 drill holes focused on infill and expansion drilling in the Lynx deposit include 2 m grading 131 g/t Au (OSK-W-17–8510), 2 m @ 113 g/t Au (OSK-W-17–846) and 2.2 m @ 73.5 g/t Au (OSK-W-17–859)…the Windfall Lake Gold deposit is currently one of the highest-grade resource-stage Gold projects in Canada…the bulk of the mineralization occurs in the Main zone, a southwest/northeast-trending zone of stacked mineralized lenses, measuring approximately 600 m wide and at least 1,400 m long….
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July 12, 2017
7 @ 7:00
Check back later today for additional posts including Daniel’s Den. BMR Morning Market Musings returns Monday.
1. Gold has traded between $1,213 and $1,226 so far today…as of 7:00 am Pacific, bullion is up $2 an ounce at $1,219 while Silver has added 3 cents to 15.86…Nickel and Zinc are leading the way among base metals with the former up 6 cents to $4.16…Zinc prices climbed to their highest in more than 3 months today ($1.30) as the market viewed falling stocks in exchange warehouses, shortages and expectations of stronger demand from top consumer China following the recent release of strong manufacturing PMI data for June…
2. Gold would face two risks if prices should drop below $1,200 an ounce – the response by the physical market and the fact that nearly 350 tonnes of exchange-traded-product holdings will be in the red, says Standard Chartered…the latter would put “excess pressure on prices should those holdings be redeemed,” the bank added…newcomers to ETP investments have not appeared willing to maintain their exposure for prolonged periods…
3. Canada has become the first Group of 7 country to join the U.S. in raising interest rates, potentially fueling speculation the world’s central bankers are heading into a tightening cycle…the Bank of Canada has just announced a quarter percentage point increase to 0.75% in its benchmark interest rate, a move that was broadly anticipated though it’s the first hike in 7 years…markets are pricing in another quarter point jump by the end of the year…
4. Gold firmed up this morning after Fed Chair Janet Yellen stated in her semi-annual testimony on Capitol Hill that interest rates won’t have to move much higher to be normalized…meanwhile, Yellen also emphasized that the central bank is closely watching tepid inflation data but that she still expects to begin shrinking its $4.5 trillion bond portfolio later this year…in prepared remarks for her testimony today and tomorrow, Yellen said that the bond portfolio, or balance sheet, eventually will be “appreciably below” its current level…last month, central bank officials unveiled their plan for slowly reducing reserves by phasing out reinvestments…still, Yellen said she anticipates the balance sheet will remain larger than it was before the 2008 financial crisis…several officials have said the Fed likely will maintain a portfolio that will exceed $2 trillion…
5. The Venture has climbed 4 points to 754 as of 7:00 am Pacific as the rising 500-day moving average (SMA) around 750 continues to provide support…Jaxon Minerals (JAX, TSX-V) has been firming up again recently and is now just a penny off its 35-cent multi-year high…the TSX has shot up 146 points while the Dow has added 133 points through the first 30 minutes of trading…
6. NexGen Energy (NXE, TSX) released more results this morning from its winter drill program at its Rook I Property in the Athabasca basin and also announced that it has commenced a minimum 25,000-m summer drilling program utilizing 7 drill rigs…6 rigs are for drilling expansion and delineation targets at the Arrow deposit while the 7th rig is testing the newly identified area 300 m southeast of Arrow…primary objectives this summer include Inferred mineral resource growth through continued systematic step-out drilling around the current resource domains in the A1 through A4 shears, primarily in the southwest and northeast ‘gaps’; Indicated mineral resource growth in high impact areas of the high-grade domains in the A3 shear through targeted infill drilling; development activities that include geotechnical, hydrogeological, metallurgical and environmental work as the project is advanced rapidly towards the pre-feasibility stage…
7. Aphria Inc. (APH, TSX) is pushing strongly higher in early trading after announcing fiscal 2017 net income this morning of $4.2 million…for the 7th consecutive quarter, the company also reported positive EBITDA ($2.8 million) which is a 181% increase over the prior quarter…for the year ended May 31, 2017, Aphria reported $6.1 million in EBITDA, a 961% increase over 2016. CEO Vic Neufeld stated, “As the medical marijuana industry rapidly expands, we believe there is a need to establish a consistent, responsible and transparent definition for licensed producers to calculate their costs to produce dried cannabis per gram. To ensure an accurate peer to peer comparison of this important metric, we are proposing the establishment of an industry standard definition for costs that includes all costs related to the production of cannabis, including quality control costs.”
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July 11, 2017
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