Mining Review Sunday Update 17th July 2022

The strong US dollar is pushing down precious and industrial metal prices.

Mining stocks are taking a beating along with other popular sectors of the market.

 

.

 

City Investors Circle – Mining Review Sunday Update 17th July 2022

 

The strong US dollar is pushing down precious and industrial metal prices, as can be seen from the table below.

Gold lost 2% week on week, and silver a whopping 3.16%. these are large numbers for a single week, especially as they come on the back of a large decline. Gold is just holding above $1,700, let’s see if it can provide support or whether we will be through into the 1600’s this week.

If gold falls any further I would expect to see announcements of some mines being put on care and maintenance soon.

The US dollar’s rise linked to interest rate rises is causing the decline of course, and we have to remember that in other currencies the price of gold is not falling so much.

It’s the same for base metals, and copper has fallen all the way back to the $3 range, after such a strong run during the past year. It’s also been badly effected by the Chinese covid lockdowns, as well as supply chain disruption, and the Ukraine conflict.

Mining stocks are unsurprisingly taking a beating along with other popular sectors of the market.

My major concern for a wile has been opportunistic bids for good quality companies by stronger ones, taking advantage of an undervaluation situation. A good example of that was the purchase of Gold Standard Ventures by Orla Mining, and now we have had Alexco being taken out with a low ball bid from Hecla Mining.

Despite Alexco announcing the buyout price of 47c per share was a “premium” to the VWAP, it’s a fraction of the price from the previous two weeks. I accept that Alexco had poorly executed (again), and once again silver had plunged just as they were restarting the mine, but this price looks like legalised theft to me.

I am concerned about Banyan Gold, where there is an obvious predator, Victoria Gold, sitting a few miles away, in production. My concern arises from the fact that the CEO’s of the two companies are married to each other!

When I expressed this concern to CEO Tara at PDAC, she responded that the NED’s were there to ensure a good, fair price is offered. Her confidence in NED’s is higher than mine, crusty old sceptic that I am.

As the shareholders of GSV and Alexco can attest, there is a danger that a good investment is sold for a song, and that just adds to the risk of holding stocks at this point.

 

Stocks on our watchlist making news this week

  Orla Mining added to tier 1 watchlist

  American Creek Resources reported 237.3 m of 1.51 g/t AU EQ at Treaty Creek

  Wesdome Gold Mines Announced Q2 2022 Production Results

  Karora Resources Produced 30,652 oz Au in Q2

  Neometals Confirmed a Mercedes Benz Purchase Order

  Orla Mining Announced their Q2 2022 Operational Results

  Cabral Gold Drilled 20.9m @ 4.2 g/t Au at Cuiú Cuiú

 

 

Market Data (US$)

Weekly price movements

 

Precious metals

Gold	1707	-2.07%
Silver	18.68	-3.16%
Palladium	1758	-16.80%
Platinum	848	-4.83%
Rhodium	13300	+3.50%

 

.

Base Metals

Copper	3.27	-7.89%
Nickel	9.22	-7.71%
Zinc	1.35	-5.59%
Tin	11.61	-0.09%

 

.

Energy metals

Cobalt	27.1	0.00%
Manganese	3.82	+6.11%
Lithium	67347	-0.84%
Uranium	47	-4.57%

 

.

Bulk commodities

Iron Ore	100.1	-9.90%
Coking Coal	240	-13.04%
Thermal coal	251	-36.78%
Magnesium	3818	-1.29%
Lumber	642	-2.58%

 

.

Metal ETF’s

GDX	25.59	-5.43%
GDXJ	30.04	-3.75%
Sil	23.96	-3.62%
SILJ	8.73	-4.69%
GOEX  (PCX)	20.87	-4.44%
GLD	159.01	-2.03%
COPX	26.91	-8.62%

 

.

Miscellaneous

Au / Ag Ratio	90.84	+0.25%
10 yr Treasury bond (TNX)	2.93	-4.99%
US  index (DXY)	107.99	+1.02%
HUI	203.56	-6.10%
RJI (Rogers Index)	8.05	-3.71%
RJA Agriculture	8.79	-5.38%
RJN Energy	4.17	-2.11%
RJZ Metals	9.6	-4.48%

.

.

=======

.If you need clarification of any information contained in this note, or have any questions, I will be delighted to assist – Please email andrew@city-investors-circle.com

=======

.

City Investors Circle is based in the financial district in the City of London

We present interesting and exciting junior mining companies listed on the ASX and TSX stock exchanges to a group of city professionals, and private investors, all of whom are active investors with a mandate to invest in junior mining companies.

Our audience is selected and invited individually to ensure interest and relevance for the presenting company.

Meetings are non deal, small group, highly focused and engaged, with a lively Q and A to follow the main presentation.

We create awareness, and maintain interest in presenting companies by disseminating their future news to our entire investor group via email, social media, and our Monthly Review newsletter.

If you wish to present to our select group of active mining investors, please email andrew@city-investors-circle.com

.

=======

,

This website is not sponsored, we are truly independent, and will always remain so.

Companies featured here have either presented to the Circle in London, or have been selected because they are considered to have interesting projects, in good jurisdictions, run by an experienced management team.

All information used in the preparation of this communication has been compiled from publicly available sources that we believe to be accurate and reliable, however, we cannot, and do not, guarantee the accuracy or completeness of this.

These articles are for awareness and informational purposes only, and are not recommendations in any form.  Always consult an investment professional.

.

.

Disclosure

At the time of writing the author holds shares in American Creek Resources, Banyan Gold, Karora resources, and Orla Mining, bought in the market at the prevailing price on the days of purchase. 

.

.