Check back later this morning for today’s BMR Morning Market Musings.
1. Gold has traded between $1,259 and $1,278 so far today, reversing higher and hitting its best level since April after a weaker than expected U.S. non-farm payrolls report from the Labor Department…this likely won’t alter the Fed’s determination to push through 1 more rate hike during this 1st half of the year when it meets June 13–14…as of 7:00 am Pacific, bullion is up $9 an ounce at $1,275 with a breakout confirmed above $1,260 as we’ll show in a chart in today’s Morning Musings…the yellow metal is well positioned to challenge the $1,300 level this month…Silver is up 11 cents at $17.38 while the U.S. Dollar Index has fallen nearly half a point…demand for U.S. American Eagle Gold and Silver bullion coins picked up in May, its first rise after 3 consecutive monthly declines…while sales are on the rebound from April’s 16-month low, the physical market for Gold and Silver coins remains lackluster – leaves room, however, for a potential sharp demand increase during the 2nd half of the year…
2. U.S. Job creation (public and private sector employment) fell sharply in May with just 138,000 new positions created while the unemployment rate declined to 4.3%, the lowest in 16 years, according to Labor Department data released this morning…economists surveyed by Reuters had expected non-farm payrolls to grow by 185,000…wage gains also disappointed with average hourly earnings rising at a 2.5% annualized pace…in addition to the weak May numbers, previous months also saw significant downward revisions…this morning’s numbers differed sharply from the ADP report released yesterday that showed a whopping 253,000 increase in private payrolls last month…private employers are stepping up hiring and U.S. factory activity ticked up in May after slowing for 2 straight months, suggesting the economy is gradually regaining speed after struggling at the start of 2017…
3. The U.S. Oil industry exported a record 1.3 million barrels of Crude per day onto the world market last week – just a half million barrels less than the cuts OPEC and Russia agreed to make to daily production…the U.S. government also reported that domestic Oil production increased to 9.34 million barrels a day from 9.32 million the week earlier (highest daily output in nearly 2 years), a sign that shale producers continue to ratchet up output even with Oil trading below $50 a barrel…however, official U.S. data gave some bullish news yesterday as it showed the country’s Crude inventories fell sharply last week, much more than expected as refining and exports surged to record highs…WTIC is off 83 cents a barrel at $47.53 as of 7:00 am Pacific…the Saudis want Oil to gain traction above $50 – a potential trigger for that could be a significant drop in the greenback which continues to deteriorate from a technical perspective…
4. The Venture is unchanged at 800 as of 7:00 am Pacific with the broader indices down slightly in early trading…PyroGenesis Canada (PYR, TSX-V) is breaking out to a multi-year new high, pushing through resistance at 80 cents…Jaxon Minerals (JAX, TSX-V), another BMR favorite and a 51% gainer on huge volume yesterday, has retreated 3.5 cents to 30 cents as of 7:00 am Pacific…we’ll have an updated JAX chart in today’s Morning Musings…
5. Cobalt prices are up 8.5% since the first week of May, equaling their early 2017 high of $25.63 (U.S.)…BMR has returned to the northern Ontario Cobalt-Silver Camp to follow up on a visit in mid-February, and our first stop has been the Castle mine in Gowganda where Castle Silver Resources (CSR, TSX-V) is the first junior in the district this year (and might be the only one) to go underground…an impressive quartz-carbonate vein structure with bands of rich Cobalt mineralization (Cobalt “bloom” and black sulphides) is the target of bulk sampling which started yesterday on the first level of the Castle mine…preparations are also ramping up for an underground drill program to intersect both Cobalt and Silver…historically, all 11 levels of the Castle mine returned exceptionally high Silver grades while no assays were ever carried out for Cobalt…a major factor in CSR’s favor is a proprietary Cobalt and multi-metal recovery process, Re-2OX, initially developed in conjunction with the National Research Council and optimized since then…it will allow CSR to create high purity Cobalt powders for end users in the battery sector while also exploring efficient and environmentally friendly extraction of Cobalt and Lithium from spent Lithium-ion batteries…
6. As of 7:00 am Pacific, the TSX Gold Index is up 3 points at 211 where it’s once again challenging resistance at the 200-day moving average (SMA) which has been declining since March but is starting to flatten out…the trend points toward a robust move in the Gold Index beginning over the summer in conjunction with a further weakening in the U.S. Dollar Index…a smaller producer such as Richmont Mines (RIC, TSX) could significantly outperform the Gold Index…Richmont is trading higher for the 3rd straight session today after releasing positive results earlier this week from an expansion case PEA completed on the Island Gold mine in northern Ontario…the study confirms the increase in underground mine and mill productivity to 1,100 tonnes per day will support strong production growth of 22% at low industry cash costs and a robust cash flow stream over the 8-year Phase 1 period, with low incremental capital of $28.2-million (CDN) required…the ramp-up to 1,100 tonnes per day is currently under way and the operation is anticipated to achieve the target run rate in the latter part of 2018…
7. MGX Minerals (XMG, CSE) was halted late in yesterday’s session, pending news or clarification of news, after announcing earlier in the day that it has made the maiden shipment of Lithium chloride 30% concentrate to the company’s Lithium compound upgrader…the samples will be analyzed for upgrading to 99% Lithium carbonate and suitability for direct-to-Lithium hydroxide upgrading…MGX is currently in discussions regarding global tolling and upgrading of Lithium chloride feedstock…the stock was up 3 cents at $1.17 when it was halted…
The most popular recent BMR articles…
How The Eskay Heart of Gold Camp Will Help Drive The Coming Venture Up Wave (Part 1)
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Tech-Savvy Junior Captures Cobalt Camp Advantage
Venture Update – The Surprise That’s Just Around The Corner!
