Good afternoon
the market is not quite sure, where to go from here…The FED was pretty cautious in Powell´s statement last night, despite the rocketing retail sales number. Good on one side - and supportive for gold - as there is no end in sight for cheap money, but the market is a little concerned by the outlook, which seems to be, that a full recovery will take quite some time.
The virus is far from being under control, as shown by recent outbreaks in China, or by today´s news of 400 new infections in a meat processing factory in Germany…not to talk about South America, where cases seem to increase in a big way. And so many smart, large investors are very cautious, if not bearish….on the other side, we have this mountain of liquidity and billions of cash waiting on the sidelines…At least it´s difficult to see, where much selling should be coming from.
So far today and towards the close of European markets, equities are climbing higher higehr here, while the US market is pretty flat.
Base metals are slightly up today execpt for nickel, which is a touch weaker…oil as measured in the price for Brent seems to establish itself around 40 US$, which is not a great price ( especially not for the shale producers ), but something most producers could live with.And lastly gold, which is stuck in a trading range but has found lots of new friends as the only currency not to be inflated by central banks…Overall, a positive mood for our sector, but missing fresh stimulus.
Not much news out today…except for
Breaker Resources - announced some excellent drilling results, especially from underground beneath the existing open pit resource: 4.6m with 12.5g / 2.5m with 12.1g / 2,6m with 10.6g and 6.8m with 4.8 g certainly indicate strong underground potential. The company is adament, that tehy are sitting on a mineable resource, whereby some concern in the market, that the resource might not hold together, are holding the share price back. The jury is out on this one - if mineable, Breaker are certainly cheap on the basis of ounces/market cap. Very good to see strong turnover in the market today…
Have a nice evening
WS