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1. Gold got a fresh lift overnight on a sudden flare-up in Middle East tensions as Iranian terrorist Qassem Soleimani, commander of Iran’s elite Quds Force and architect of its growing military influence in the Middle East, was killed in a drone strike by U.S. forces authorized by President Trump following the attack earlier this week on the U.S. embassy in Iraq…the yellow metal has traded between $1,538 and $1,552 so far today…as of 7:00 am Pacific it’s up $19 an ounce at $1,548…Gold has already broken out above a bull flag formation on its long-term weekly chart, and a move through resistance in the $1,520’s is also significant…$1,675 is our target for the 1st half of 2020, certainly achievable during Q1…over 100,000 ounces were added to exchange-traded-fund holdings yesterday…demand for Gold in China should start to pick up in advance of the Chinese New Year period starting January 25, a key Gold buying occasion in the region…Silver is up modestly at $18.08…Copper is steady at $2.78…Nickel has slipped 17 cents to $6.26 while Zinc is off slightly at $1.04…Crude Oil has firmed up on developments in the Middle East, adding $2.24 a barrel to $63.42, while the U.S. Dollar Index has rebounded one-tenth of a point to 96.95…U.S. military action against Iran overshadows a very busy day for U.S. economic data, including the afternoon release of the FOMC minutes from the last meeting…traders and investors will glean the FOMC minutes for clues on the future direction and timing of Federal Reserve monetary policy…meanwhile, in some economic news just out, which has helped to give Gold another boost, the latest ISM Manufacturing Index reading came in below expectations..
2. Qasem Soleimani was arguably the world’s #1 bad guy and should have been taken out years ago…he was in control of Iran’s Quds Force for more than 20 years…he helped Bashar al Assad slaughter hundreds of thousands of his own people in the Syrian civil war, stoking the Houthis in Yemen’s civil war, and oversaw the killing of hundreds of Iraqi protestors recently demonstrating against Iranian influence in their country…but most importantly for Americans, Soleimani was behind the deaths of hundreds of American soldiers during the Iraq War…Iran of course has threatened to retaliate against the United States…the 62 year-old Soleimani was regarded as the 2nd most powerful figure in Iran after Supreme Leader Ayatollah Ali Khamenei…top Iraqi militia commander Abu Mahdi al-Muhandis, an adviser to Soleimani, was also killed in the attack…Iraq’s Prime Minister said Washington had violated a deal for keeping U.S. troops in his country…Israel has put its army on high alert and U.S. allies in Europe including Britain, France and Germany voiced concerns about an escalation in tensions…meanwhile, President Trump this morning tweeted his first statement on the attack…“Iran never won a war, but never lost a negotiation!”, an apparent reference to Obama’s flawed nuclear deal with the rogue nation…
3. Canada Cobalt (CCW, TSX-V), in the midst of the significant grassroots high-grade Silver discovery in 40 years in the Northern Ontario Silver-Cobalt District, delivered a high-grade Gold surprise this morning from underground drilling on the first level of the Castle mine…all of this comes as newcomer Matt Halliday (VP-Exploration) shapes a dynamic new course for CCW, coming over from Kirkland Lake Gold (KL, TSX, NYSE) where he was resource geologist…“The presence of Gold in gabbro (diabase) vein structures, open toward the surface and at depth, is extremely intriguing,” Halliday commented…“Through some immediate lab work we will better understand what this Gold is associated with in preparation for aggressive follow-up. Gold content bodes very well for our underground model. Also, this gives fresh impetus to our drive to find a high-grade Gold system in the heavily under-explored Archean rocks, a very favorable host for Gold, adjacent to our new high-grade Silver discovery at Castle East 1.9 km from Shaft #3. These are exciting times for our geological team. We eagerly anticipate updating shareholders with respect to the Castle East discovery where drilling is scheduled to resume Monday, January 6, with a second and larger batch of assays expected from the lab during this first half of the month”…CCW this morning reported high-grade intercepts up to 22.7 g/t Au, 4% Cobalt, 4,970 g/t Ag (145 oz/ton) and 5.4% Nickel in short multi-directional drill holes (upward toward the surface and down into the floor of the first level) into a main vein structure (with associated parallel veins) extending for at least 80 m and open in all directions including to depth…nearly half of the 16 holes reported this morning (assays pending for 31 more) returned intervals >1% Cobalt (Cobalt grades from the first level of the Castle mine, previously only exploited for its high-grade native Silver, are considered very high in a global context)…meanwhile, drilling at the Castle East high-grade Silver discovery resumes Monday…more assays of recent native Silver hits are expected during this first half of January…CCW has broken out to a new 52-week high of 69 cents on strong volume, pushing through resistance in the mid-60’s…next measured Fib. resistance on the key chart we follow is $1.04…
4. Tesla (TSLA, NASDAQ) has delivered a record 112,000 vehicles globally during the 4th quarter, significantly topping Wall Street estimates and achieving an ambitious year-end sales goal of CEO Elon Musk…Wall Street expected Tesla to deliver 106,000 vehicles to customers during Q4, which would have just met the company’s annual delivery goal of between 360,000 and 400,000 vehicles, a 45% to 65% increase from 2018…Tesla said it delivered approximately 367,500 vehicles last year, an impressive 50% increase from 2018…Tesla is up sharply to a new all-time high in early trading…
5. The Dow has fallen 191 points through the first 30 minutes of trading as nervousness builds around the situation in the Middle East…Wall Street enjoyed a strong start to the new year and decade yesterday after booking a powerful 2019 performance on Tuesday with the S&P 500 rising 28.9% for 2019…that was the broad index’s biggest annual gain since 2013 when it surged 29.6%…the Dow, meanwhile, climbed 22.3% while the NASDAQ surged more than 35%…gains were much more modest in Canada for 2019 as the TSX climbed 19.1% while the Venture eked out a 3.6% gain…the TSX, helped by rising Gold and Oil prices, is off only 31 points in early trading this morning while the Venture, on an 8-session winning streak, has added another 3 points to 591 as of 7:00 am Pacific…Palladium One (PDM, TSX-V), on a robust run, has eased off slightly to 19 cents but should be accumulated on any weakness based on bullish chart patterns…QMX Gold (QMX, TSX-V), a Quebec high-grade Gold play with fresh momentum after an investment by Eldorado Gold (ELD, TSX; EGO, NYSE), is looking strong at 9.5 cents…Score Media & Gaming (SCR, TSX-V) is threatening to break out to a new high, up 2 cents at 82 cents…
6. Despite Gold’s best year in nearly a decade, U.S. Gold coin sales struggled as the U.S. Mint reported the worst year on record in terms of American Eagle Gold coins sales…the Gold coin demand was extremely weak as traders opted for ETFs, futures, and record-high equity markets, according to analysts…a total of 152,000 ounces of the Gold American Eagle coins were sold in 2019, 38% less than in 2018 according to the latest U.S. Mint data…this marked the lowest sales on record since the U.S. Mint began recording the figures in 1986…sales of Silver American Eagle coins were the worst since 2007 with only 14.9 million ounces sold, down from the already weak figure of 15.7 million reported in 2018…in 2007, sales were only at 9.9 million ounces…one of the reasons behind a strong Gold price and weak demand for Gold coins is investors choosing to hold Gold in other forms, such as Gold-backed ETFs and futures…“It was mainly professionals, hedgers and you had a lot of buying from South America,” RBC Wealth Management managing director George Gero told Kitco News “Money that normally could have gone into Gold coins ended up going into Gold ETFs or Gold futures”…
7. Cannabis industry insiders are bracing for a slew of bankruptcies in the coming year as small and medium-sized companies low on cash struggle to raise funds in the downtrodden sector…“We have had a busy few years, but we’re going to be busy in 2020 for a different reason – we expect a few million dollars in legal fees from insolvencies and consolidation,” stated Ranjeev Dhillon, a partner at McCarthy Tetrault LLP and the firm’s cannabis group lead, in a Financial Post report…Dhillon says that his team is already seeing companies that are heading down that path…“Companies that cannot distinguish their brands and don’t have the money to keep up operations on existing facilities will not be able to carry forward,” he told the Financial Post in an interview…“The only kind of money you can raise right now, if at all, is debt”…there are currently more than 200 cannabis companies either in the cultivation, processing or extraction businesses, primarily supplying a domestic market that has yet to cross the $1 billion mark in annual sales…although cannabis sales have been increasing on a monthly basis since legalization in October 2018, inventory has been growing much more quickly, resulting in oversupply and declining prices… “We are definitely going to see some companies struggle,” said Greg Engel, CEO of Organigram Holdings (OGI, TSX, NASDAQ) which has also been hit by slumping sales…“We’ve already seen two companies file for bankruptcy protection, and they certainly won’t be the last”…in December, Wayland Group, one of the first pot companies to obtain a cultivation licence, filed for creditor protection…2 months earlier, DionyMed Brands had entered into receivership after failing to repay debt…“Companies that don’t have a good cost structure will be in a really difficult position. It’s not about growing cannabis anymore, it’s about how efficient you are as a consumer packaged goods producer,” Engel added…
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I’m hearing that the big money people to get some of these plays going, are either still on the beaches or still on the ski slopes , Jon are you still on the slopes? Lol.
Comment by Laddy — January 3, 2020 @ 9:47 am
Jon Can you explain the logic behind Eric Sprott’s donation of shares to his Sprott Foundation. Was this a tax move and does in open him up to buy more shares away from the foundation.Is there a time limit as to when he can purchase new shares and do think this is a possibility.
Colleen
Comment by Colleen — January 4, 2020 @ 2:04 pm
Eric made an astute tax move, Colleen, triggering a tax loss for 2019 without having to give up control over his GGI holdings, and he’s put into his foundation a stock that could give that foundation a tremendous lift over the next few years.
Comment by Jon - BMR — January 5, 2020 @ 4:07 am