Good afternoon
Mrs. May , the new UK-premier, sounds like a pretty good choice - at least from what I have heard and seen so far. Markets seem to agree - she is managing to induce some confidence , and Sterling is recovering. Amazingly enough, the FTSE 250 Index ( much more representative than the FTSE 100, which has numerous foreign companies included, like BHP/RIO etc ) has recovered most of the initial fall of 19% or so, and is down by just 2.5% from pre-Brexit level. Crazy stuff, and we have a good example here, just how much these markets are driven by liquidity !
Markets are continuin to race, on the back of the expectation of more stimulus. I am asking myself, what else tehy could so? Helicopter money??? If it continues like this, my cynical comment from a few days ago, that the debt problem is non-existent, as central banks around the world only had to cancel out all governemnet bonds they own, might not be all that crazy and cynical!
Even a large investment bank, Macquarie, is saying in it´s research today: " We believe that global economy and investors are residing in the twilight zone between an era of relatively free market capitalist economies and a new enviroment which is likely to be completely dominated by the state. ....It would take the form of state-sponsored stimulation of consumption, investment, R&D and rescuing what essentially is a bancrupt financial super structure ...."
Buy gold???? Buy gold!!!!! Very interesting today: gold is weak...finally succumbing a little to the fantastic run in equities around the world...BUT: as I am finishing this, the GDXJ is trading unchanged, gold at 1338 US$...that tells me, that we are just having a correction within a strong trend!
Goldman Sachs have come out and largely reversed their negative outlook for the metals...especially for nickel: 12.000 US$ in 6 month, and zinc: 2500$ ....that is good news. Goldman´s recommendations still carry a lot of weight, and unsurprisingly, metal prices in London are up by around 2% - nickel at 8-month high of 10.330 $/t and zinc 12-month high of 2184 $hd -´r
Panoramic - sorry..again my favourite subject...but they came out with early Quarterly reporting. Not a major story, as tehy ceased production from Savannah at the end of May. Produced just short of 2.000t nickel in the Quarter. The company has 30 mill $ cash and receivables - and will probably have 27 mill$ after all redundancies etc have been paid for, which is about 2 mill$ more than expected - probably nickel price related. They hint at more positive exploration results, to be published in the full Quarterly, and perhaps more important in the short run, at metallurgical progress on the treatment of their refractory gold reserve ( on top of the oxide reserves ). I spoke to Peter Harold today, who is genuinely very bullish on nickel- as well as gold exploration. The feasibility study on Savannah North is making good progress! Will be very interesting to see, what costs they will come up with! In the short run, PAN´s chart looks a bit toppy - in the long run, they might have just started...
Have a nice eveing
WS
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