Gd afternoon
Selfish politicians are using the Syria-crysis for themselves…Trump claimes, that he saved this part of the world, while Mrs Kramp-Karrenbauer ( potentially successor to Angie Merkel, and the Minister of Defense ) makes a mockery out of herself to propose all sort of things, which nobody wants and nobody has been consulted on…only to give herself some headlines. She shows again, that the best thing about her is her strange name…
Durable Goods in the States were pretty weak, while PMI´s were much more positive…
Draghi´s last press conference today with a reltively weak economic assessment with comments, that the weakness in manufacturing is starting to have an impact on employment. The latter + retail sales have been the mainstay of the growth here - at least of the little growth, which is left! Yesterday, Prof.Schnabel was mad a director of the ECB. A German finance professor, she is seen as a supporter of the loose policy of the ECB and should be a supporter of Madam Lagarde.
A sensational result from Tesla, and good results from Microsoft, Daimler and BASF are sending the market higher today…DAX is trading at a new high for the year!
Base metals looking ok as well - nickel especially strong, as Papua Neuguinea announces, that a close of Ramu Nickel is imminent. Spill from the tailings dam - that is something these days, which sets ALL alarm bells ringing. Ramu is a large mine, producing 34.000t of nickel p.a. …Sorry to say, but that´s what we needed…nickel is back up to 16.850 US$/t, and in A$ terms, is trading 8-9% below recent highs, but 60% higher than at the beginning of this year! The discussion about the strange action in the market is continuing, while stocks are still falling heavily, to about 79.000t and marking a fresh 10 year-low. Perhaps interesting to note, that Norilsk and Western Areas have made new highs today
Tietto - another round of strong drilling results from the Ivory Coast project today. 21m with 13g; 10m with 7g; 7m with 12g are exactly, what it needs. Looking into some more detail, though, I am not that positive: L for example, the 21m with 13g intersection reveals, that the sections includes 7m with 38g ( and that in turn includes 1m with 253 g ) . That automatically implies, that a large part of the 21m-intersection only carries say 1g-dirt. And this type of occurence we have throughout the recent drilling! So I am not really sure 1. how much tonnage do these results really add? and 2. how ill you mine it ? There got to be a massive amount of dilution in ore-to-the-mill. So while I am remaining underlying positive, and while I am a shareholder, I am watching closely. This is certainly not another West African Resources, at least for now! I will meet them in about 2 weeks time and will try to get a better understanding…
Genex - this stock just does not move! Energy Australia yesterday gave a presentation and included a page of their green projects, which includes a mention and a foto of Genex´s hydro project…not sure, how they can advertise this, without having signed an agreement…in any case, they seem to give it a very high probability of becoming ( partially! ) their project! One morning we will wake up, and the GNX share price is up by 20% or more! Be patient… this story remains one of my top priority stocks.
Newcrest - Quarterly out today - disappointing on almost every mine they operate. No dramas there - but just softish everywhere! Plant downtimes at Cadia and Lihir seem to be the major reason - Telfer is also continuing to struggle. I think the latter might be in real trouble, if not for the sensational A$ gold price - and even with the strong gold price, I would not bet on the future of this mine. I am sure, that closure is not imminent - there is too much excitement about exploration within trucking distance of the plant - but it certainly needs a trigger in the not too distant future to stay alive! I continue to see absolutely no reason to own them, with so many well managed Australian mid-sized gold miners around, like Evolution, Saracen, and Northern Star ( despite some questionmarks on Pogo ), which might not be dirt cheap, but at least are way cheaper than Newcrest!
Breaker - have found a large gold anomaly ( through aircore drilling ) , which us up to 2.5 km long and 500m wide, just 1.3 km from the Bombora gold desposit. The anomaly has many similarities to Bombora , and shows the exploration potential left in this stock. As you all know, a corporate review has just started and I would be surprised, if none of the neighbours would come to the table. By running this process, Breaker tries to avid the problem of many exploration stocks: Constant capital raisings dilute existing shareholders heavily, and result in many of these companies to trade “cum placement” every 6 month or so. It might make more sense to have a corporate come in with a sizeable amount and to give away some upside! Preferrably for shareholders, this should happen at the corporate level, not at project level - unless you believe, that the upside is 3-4-5x the current share price! But I have to admit that for now, I would be very happy with double the price…
Sandfire - Quarterly was about in line, but guidance has been lowered a little bit…more towards the lower end of previous guidance, so no drama. Degrussa, their only mine currently, will be running out of ore in 3.25 years, and so far, they have not been able to replace reserves, despite trying hard. It remains t be seen, what will happen with the recent aquisition MOD and it´s asset in Botswana…and approval for their US mine could be years away. While the stock is not expensive, I am missing sex appeal…and a more definite path to growth ( which, by the way, would chew up much of their cash generated by Degrussa ).The only - more or less pure - copper producer of size in Australia for me to invest in remains OZL.
Have a nice evening
WS
WS
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