Market Update

General - Nevsun - Prairie -

Good afternoon

 a pretty uneventless day today....

OPEC meeting without any changes - no production ceiling. Oil price a little weaker - but I guess 48$ for WTI is a price the world can live with anyway.

Iron ore slipped under 50$ again yesterday, for the first time in some time. 

Base metal prices, gold, currencies and equities are barely changed today., and ecomomic numbers in the States have been boring as well - markets expecting important labor market numbers tomorrow. Markets are holding the breath for the Brexit polls are indicating, that the POM´s are planning for "splendid isolation". Would be a pity - I prefer Champions League with English teams!

A story which caught my eye today: Softbank invested 20 mill$ in Alibaba in 2000, and were holding a 32.2% stake as at yesterday. They have sold a 4.2% stake for 8 bill$!!!! Absolutely amazing.....400x their money realized, and still 28% of the company left....

Nevsun Resources - announced some great exploration results from their Asheli prospect, within the Bisha District, where they have their existing copper/zinc mine in Eritrea. 13m with 0,9% co and 28% Zn follow on from previous results like 44m with 2% Co and 9% Zn....they already had great results from underneath their existing orebody earlier this year as well, with 30m at 2% co and 9% Zn ...Clearly, the mine will have much longer life than the current 9 years left, and the district is shaping up as a typical VMS - if you find one, there are more! 

Workers at Cerro Matoso, a large, 36.000t nickel mine in South America - previously owned by BHP, now by their spin-off South 32, will probably go on strike. South 32 is trying to cut costs from last Half´s 9700 US$/t operating costs ( price today is 8420 US$/t ). Management making big noise about the fact, that they are loosing money , and that they cannot afford to operate the mine at consistent losses. This could actually be the first large nickel mine to close - no smelter attached, and new management, which has not been responsible for the original decision to build it. Would be fantastic news for the nickel market - but not to be expected in the short term.

Investor APAC has put it´s 20% stake in Metals Ex on the block - more corporate action for Australian gold producers should be expected.

Prairie Mining - had an offical ceremony yesterday to announce the positioning of their planned shaft for the new coal mine in the Lublin area in Poland. It was very obvious, that the company has got big support for the project, which would bring thousands of jobs and tax income to this poor area. The event got nationwide attention. Prairie really is not suited for short term players, and nobody seems to like coal anymore - but they clearly have a very good project here, and I have little doubt about it´s development. The only question is when, and by whom - I hope that the obvious candidate, Bogdanka, will make a move in the next year or so.

Have a nice evening


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