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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