Good afternoon
Trump imposes some tariffs on Europe…on 11 bill US$ worth of goods…mainly relating to Airbus subsidies. No major surprise, and no major number - but of course, it´s getting the ehadlines, as this is yet another unfriendly act towards Europe…
Equities largely unchanged , before negative growth forecast form the IMF were published . - I think any further move will need a reasonably assuring trade deal + a reasonably soft BREXIT!
Metals also a little stronegr today, gold stablishing itself above 1300 US$ WTI continues to trade above 71 US$. In A$ terms, that´s roughly equal to last hal years average - so probably not a reason for concern as yet for our mining companies at a time, when there are some cost pressures at work - namely for labor.
Genex - has been under some pressure for the last few days. There has been one of the rare research reports being issued on them, and the broker in question reduced his recommendation to a hold. He based his forecasts on a couple of quite significant mistakes, and he updated his research mainly on what he perceived to be higehr capex, and more equity needed. I very much doubt his findings…and I believe, that he initiated his changes without consulting the company itself. In my opinion, a great buying opportunity. The main trigger for the stock will be ( hopefully ) the announcement of a transmission agreement as precursor of the full financing of the hydro-power project, as well as hopefully government grant from ARENA to support the project - both should be fixed in the enxt month or two. On the numbers I have seen previously, the stock is worth rather 50ct than 20ct…great buying opportunity, in my opinion, as no fundamentals have changed other, that the ened for storage is rising every day in Australia, in light of an ever-growing, renewable power generation sector in Australia.
Prairie Mining - lost tehs econd court case in Poland with regards to their rights to the Jan Karski mine. The company stated, that the court has retrospectively used a 2018 change to the law, which would clearly be wrong. In any case - company continues to negotiate at the corporate level with JSW, who have publicly said, that they want to porvide a clear pass to ownsership of PDZ´s assets by the end of April. I believe it to be highly unlikely, that corporate action would take place at the current level of 40ct!
Lucapa Diamonds - what a fantastic Quarterly - but some numbers had been known already! Both mines are going gangbusters - something we cannot say about the share price which seems to be under constant, mild selling pressure. Production above budget at both mines, cash looking good, debt refinanced….more over the enxt few days.
Peek Resources - I had not written about them for a while, as teh stock was pretty dead, working on a rare earth project, which ahs costs above current prices, and is based in Tanzania. The stock came back to a bit of life the last few days, as the Lynas-bid has increased awareness to the sector. Today, they updated on their project. The Minister of Mines confirmed, that the application of a Special Mining License has been ok´d by the Mining Comission, and is just awaiting approval from the cabinet. This is the final, regulatory approval needed. They also stated, that that a number of Memorandums of Understanding and Term Sheets are currently under negotiation, Sounds good! The project is a good one, with processing in England and fully approved there - but the price of rare earth is wrong in the moment!
Have a nice evening
WS