Market Update

General - West African Resources

Good afternoon

Trump is talking the two SS´s - shit and secrets! One should really grab him by his pu..y ! I am just astounded for how long this once respected Republican Party will support this guy....Sorry, but I just can´t help myself - I have to bash him!

Europe growing nicely, and investor sentiment is strong - but relatively weak numbers for Italy are a concern. Greece is too small to be a real concern! The pressure on Germany is increasing to start spending, or push the local economy via increasing wages!

Mixed news from the US-economy today - housing market soft, while Industrial Production very strong - climbing the most in 3 years.

The odds for German elections this autum are now 83% in favour of Angie Merkel - that´s certainly a positive for markets. And Macron is gaining credibility here. He has made a good start. Accordingly the US$ is trading at lowest since the election in Nov - but that´s not enough support to hold metals today, which are a tad weaker. 

I thought, that yesterday´s, Chinese numbers have been quite ok vs expectations - after all, credit conditions don´t seem to be too bad, and the economy in general is slowing down, but still doing very well. But a fall in growth rates usually is followed by an adjustment in inventories, exerbating the negative short term effects.

West African Resources - my favourite Western African developer came out with some excellent numbers. At their M1 deposit, they got 30m with 20 g at about 350m depth, and some more 10-15g intercepts over 15-20m . The latest hole found visible gold at about 450m depth ( assay should be out next week so so ), so far the deepest intersections and pointing to substantial underground potential. WAF have 5 drill rigs working, and soon 6 - they will continue drilling until they have closed off the ore body. Incl 15ct-options to be issued shortly, WAF have 20 mill$ in cash - the budget calls for expenditure of 12 mill until March 2018. The company had planned to announce a revised feasibility study ( incl underground ) in the 4th Quarter - I see this as highly unprobable, as it does not make sense, to come up with a study, just to tell the market, that they are still finding gold and that they see further upside. Richard has made that mistake once - he will give himself sufficient time this time around, especially, as teh company has the cash to wait until first half 2018.

In my opinion, the question here is, whether the company can increase reserves by enough to become a sustained, 200.000 oz producer - and not, whether they can extend the initial 3-year 150.000oz rate by another 3-4 years! Recent drilling has given them enough tonnage-upside to buils a reserve, which should be large enough to attract much larger companies!

Have a nice evening