ECB is cautious on Euro-economy…sending European bonds up today..and the US$ finished it´s short, weak spell quickly…
US CPI more or less as expected + 1.9-2.0% depending on the series
Still, gold is trending higher at 1308….other metals slightly weaker earlier on - but towards the end of our day, zinc and especially nickel are up by about 0.5%. LME stocks in nickel yesterday moved higher by a paltry 114t, after haveing fallen every day since 19th of Feb! They are unchanged today. Cobalt is up again, and has now recovered to just under 15$/lb from the recent low of 13.60 US$/lb.
Equities are slightly stronger today, without really having conviction.
OPEC production numbers are weak, partially because of Venezuelian output falling heavily. Oil continus to trade around 71 US$ for WTI
Panoramic - the shortfall of the recent rights issue has been announced today - a very positive takeup of 87% by shareholders, which was to be expected with a pre-rights issue price of 47ct, but given the fact, that the stock traded at 38-40ct ( and only just above the price for new shares ), I think this is testimony to PAN´s very strong shareholder base. The shortfall of about 5.5 mill shares I presume will go the largest shareholder as subunderwriter .
Tietto - came out with a strong announcement the other day ( even though the market seems to have expected even better! ) , having increased their resource to a total of 37.6 mullt at 1,4g gold for 1.73 mill oz - all in the inferred category only ( and here I guess the market has been a bit disappointed, hoping for some “indicated” ounces ). The so called AG deposit consists of 26.4 millt at 1,6 g for 1.38 mill oz. This resource containes a higher grade resource of 15.4 millt at 2,01 g for . Additionally, the APG deposit containes a lower grade resource of 11.2 millt at 1g for 350.000 oz, incl some 120.000 oz at the top, which might be contained in free digging ore. The previously announced, total resource has been 700.000oz…The above increase has been achieved with 17.000m of drilling. This year, the company will drill a total of 20.000m, which should go a fair way to not only convert a good part of resource into the indicated category, but also increase the overall resource. Well worth watching - Ivory Coast is ok, and the market cap of 40 mill is not demanding.
Lynas - nice fight is developing here with Wesfarmers. Wesfarmers have gone the highly unusual way of talking to the Malaysian government about the project and I guess also about the indicative bid for Lynas. This has raised many eyebrows - for me, this is entirely understandable, given that the asset is subject to the well documented hazzle between the regulator/government and Lynas. In any case - Lynas has moved into the offensive, gathering support from it´s Japanese financiers, and outline the excellent management capabilities of Lynas. I completeyl agree to the latter, by the way! They have done an excellent job, since Mrs.Lacaze took over as MD. The indicative bid of Wesfarmers has been pitched at 2.50$, subject to all operational approvals being in place. I would not be surprised, if the end game here will be: straight takeover at 2.50 A$….obviously, WES is talking to the government, clearing the decks for future use of the Malaysian plant, perhaps by eliminating most or all of the radioactivity of the material in Australia ( i.e. “leaving this, where it´s coming from”) ? And still bid 2.50 A$? We will find out. LYC basically is “The Western World Spply” of rare earth - well worth fighting for! And if I am right, there is 40ct left for investors, which is pretty good as well!
Metro Mining - the wet season is over! News flow is about to start again! That´s very good news - the stock has been very much left behind, as the bauxite miner does not mine between Dec and the end of March every year, because of heavy rains in the very Northern part of Queensland. In a presentation today, the MD announced, that the first ship has been ordered for tomorrow - and I guess will depart before the weekend ! The company is targeting 3.5 mill t of bauxite shipments, following their first year of production in 2018, shipping 2.04 millt. Bauxite prices are very reasonable, and shipping rates as well. the company has moved to owner-mining, which will further reduce costs - and the A$ is helping as well. So 2019 should become a very profitable year for them. Some time this Quarter, the company will also announce results of the feasibility study, which will increase production once again to 6 millt p.a., financed from cash flow and existing lines of credit.
Have a nice evening
WS
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