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April 9, 2020

7 @ 7:00

Visit the BMR comments section throughout the day for updates and helpful information!

1. Spot Gold has traded between $1,647 and $1,695 so far today…as of 7:00 am Pacific, the yellow metal is up $35 an ounce at $1,682 as a major breakout looms…Silver has pushed through key resistance at $15, up 53 cents at $15.43…Colin Hamilton, head of commodities research at BMO Capital Markets, sees a new role for Silver which will shake up demand…“As governments seek to further bolster economic recovery, we anticipate Silver-intensive areas such as 5G and solar technology could well benefit from any fiscal impulse, making Silver increasingly the ‘infrastructure’ precious metal,” Hamilton wrote in a report this week…base metals are relatively unchanged with Copper, Nickel and Zinc at $2.26, $5.21 and 86 cents, respectively…Crude Oil prices are up sharply on reports that Saudi Arabia and Russia have reached a deal on a deep output cut, according to Reuters which cited 2 sources, and that cuts could reportedly be as high as 20 million barrels per day…the reported deal comes as a virtual meeting between OPEC and its allies, known as OPEC+, kicked off in which some of the world’s largest producers were set to discuss production policy as the Wuhan COVID-19 pandemic saps demand for Crude…WTI is up $1.65 a barrel to $26.74…the U.S. Dollar Index has retreated half a point to 99.56…Treasury Secretary Steven Mnuchin told CNBC’s Jim Cramer this morning that he believes it’s possible the U.S. economy could open back up next month…Mnuchin said that the administration was doing “everything necessary so American companies and American workers can be open for business and that they have the liquidity that they need to operate their business in the interim”

2. The number of Americans seeking unemployment benefits continued to surge at record levels, bringing the total number of applications to nearly 17 million since the Wuhan COVID-19 pandemic shut down large swaths of the U.S. economy…the Labor Department reported this morning that another 6.6 million people submitted applications for unemployment benefits in the week ended April 4…that’s on top of a revised 6.9 million in the prior week, a record, and 3.3 million the week before…another key measurement of joblessness showed a record 7.5 million Americans were receiving unemployment benefits at the end of March…continuing claims, a figure that captures the number of people drawing on benefits, grew by 4.4 million in the week ended March 28 to 7.5 million, eclipsing a record set in 2009 at the end of the financial crisis…the number of continuing claims lags behind the application data and is expected to continue to grow as more people seek jobless benefits…

3. Federal Reserve Chairman Jerome Powell said this morning that the economic rebound following the coronavirus-induced shutdown “can be robust” despite the sharp downturn…in the meantime, he said the central bank is committed to doing whatever it can to support the flow of cash to businesses and households both through a plethora of financing programs and by keeping interest rates anchored near zero…Powell spoke during a webinar for the Brookings Institution the same morning that the Fed announced a new $2.3 trillion financing initiative directed at small and larger businesses as well as households and state and local governments…“At the Fed, we are doing all we can to help shepherd the economy through this difficult time,” he said in prepared remarks…“When the spread of the virus is under control, businesses will reopen, and people will come back to work. There is every reason to believe that the economic rebound, when it comes, can be robust”…as part of its announcement, the Fed has actually expanded its corporate lending programs to take them in an entirely new area, including ETFs of companies that are rated below investment grade…the Fed says most of the ETFs it will buy “will be of ETFs whose primary investment objective is exposure to U.S. investment-grade corporate bonds, and the remainder will be in ETFs whose primary investment objective is exposure to U.S. high-yield corporate (junk) bonds”…what’s next from the Fed?…

4. Canada lost a record-breaking 1 million jobs in March while the unemployment rate soared to 7.8%, official data showed this morning, as federal and provincial governments forced the closure of non-essential businesses cue to the Wuhan COVID-19 pandemic…Statistics Canada said the data did not fully capture the extent of the job losses since the agency polled respondents before the crisis began to take its full toll…analysts in a Reuters poll had forecast a loss of 350,000 jobs and an unemployment rate of 7.2%, up from the 5.6% seen in February…“Sticker shock for sure. This was about as bad as it could be given the weekly (unemployment) claims that have been divulged,” stated Derek Holt, Vice President of Capital Markets Economics at Scotiabank…more than 5 million Canadians had applied for all forms of federal emergency unemployment help since March 15, government data showed today, suggesting the real jobless rate is closer to 25%…Canada came into this crisis in significantly worse shape economically than the United States, thanks to to job-killing “save the planet” policies at the federal and provincial levels…the resource sector, for example, shrank considerably in January before the Wuhan virus became a factor…

5. Canadians should have no patience anymore for radical environmentalists (and politicians who don’t challenge them) who aim to inflict further damage on this country’s resource sector…yesterday, Stand.Earth attempted to push Boston-based insurance company Liberty Mutual to cancel insurance policies for the Trans Mountain and Keystone XL projects…meanwhile, a group of British Columbia First Nations is seeking to challenge the federal government’s 2nd approval of the Trans Mountain pipeline expansion in Canada’s highest court…the pipelines are currently under construction to connect Oil projects in Alberta, which is now projecting a 25% unemployment rate, with overseas markets and the heavy-Oil refinery cluster on the U.S. Gulf Coast…now is the time Canada needs to focus more than ever on building pipeline capacity to create jobs and prepare for the next leg up in Oil prices…

6. The Dow continues to push higher, up 525 points at 23,959 as of 7:00 am Pacific…a band of resistance stretches from 23,000 to about 25,000…in Toronto, the TSX has gained 365 points with the Gold Index jumping 17 points to 281…a major breakout in the Gold Index this month appears almost certain…Marathon Gold (MOZ, TSX), one of our favorite advanced Gold plays, is threatening to overcome key resistance at $1.30…the Venture, turning the corner, has added another 9 points to 418…next resistance is the EMA(50), currently in the 450’sSona Nanotech (SONA, CSE), continuing to hover around the $2 level ahead of next news, is off 3 cents at $1.93…testing and contact tracing are the bridge to reopening economies and that’s why SONA remains such an exceptional opportunity…Sixth Wave Innovations (SIXW, CSE), which soared as high as $1.20 Monday, has found its footing in the 70’s above previous resistance after major news last Friday…the chart pattern for SIXW resembles SONA’s early pattern…Sixth Wave has filed a patent application that contemplates the development of a flexible platform for the quick deployment of RDTs (Rapid Diagnostic Technologies) for new viral threats…this AMIP technology (Molecularly Imprinted Polymers) could have all of the advantages of traditional PCR and IAT diagnostics, with the potential to be developed, deployed and scaled in a fraction of the time…this proposed “AMIP” device would generate an instant colorimetric response, or change in colour, to indicate the presence of COVID-19 or other viruses…the company is tight-lipped about physical applications for the AMIPs technology at this point…however, it’s intriguing to note that SIXW has already developed highly effective wipes-style products in the past (most notably explosive detection wipes – “EDW” – used by the U.S. military), and that wipes may be one of many excellent ways to deploy AMIPs…imagine wiping a surface and being able to detect COVID-19 or some other potentially deadly virus…on the resource front, Skeena Resources (SKE, TSX-V) has closed the first $15 million tranche of a flow-through financing that has been upsized to $30 million…record Gold prices, anticipated this year, will bode very well for Skeena’s Eskay Creek Project…graphene-focused G6 Materials (GGG, TSX-V) continues to make higher highs and higher lows, up half a penny at 9 cents…the company expects to soon roll out a unique graphene-coated air purification system that kills viruses…Ridgestone Mining (RMI, TSX-V) appears to be in the early stages of a new Gold discovery at its Rebeico Project in Sonora State – drilling continues…on the Silver front, Canada Cobalt Works (CCW, TSX-V) – soon to be renamed Canada Silver Cobalt Works – is in an ideal position to gain considerable traction over the immediate/near-term as more details emerge on the most exciting high-grade Silver discovery in Northern Ontario in several decades at CCW’s Castle East target, within 2 km of ~70 million Silver ounces mined historically in the rich Gowganda Camp…

7. Great Bear Resources (GBR, TSX-V) has drilled 42.7 g/t Au over 3 m, including 188 g/t over 0.50 m, within a broader interval of 4.2 g/t Au over 52.15 m at its 100%-owned Dixie Project in the Red Lake District…the company has completed 83 of approximately 300 planned drill holes into the LP fault target as part of its 5-km-long x 500-m-deep grid drill program…Gold mineralization has been intersected in all (100%) of the drill holes for which assays have been returned to date…Chris Taylor, President and CEO, commented, “We continue to observe excellent lateral and vertical continuity of mineralization within the LP fault Gold system. Despite the ongoing COVID-19 pandemic, we have been able to maintain drill operations while continuing to protect our work crews with strict risk mitigation protocols. All geologists and geotechnical staff on site are Red Lake residents, which gives us sufficient staff for 3 of our 5 drill rigs to remain active. We plan to return to full drill capacity once pandemic-related work restrictions are lifted, and it is safe to do so. However, even with three active drill rigs the full estimated 300 drill hole program remains on track to be completed by December, 2020″

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  1. I am appalled with this.. these are good friends of ours.. please distribute.. talk about being uncanadadian . No disrespect meant but you first nation communities need to address your own back yard…and you continue to want our help and our money .. well FU

    This is fact: Friends of our who live on the Reserve Whitefish River First Nation outside of Little Current , Manitoulin Island received a letter from the band on I believe Tuesday evening informing them that as they are non native they have to leave the reserve and their homes by today, Thursday at 5:00 PM. They have lived there, on leased land, with a lease for over 20 years. There are over 40 people being told this. It is WRONG. What makes them more dangerous to the band community than band members. They are not seasonal members, they are not just dropping in to by smokes…they live here and it is WRONG. How can they evict someone in this PANDEMIC. We need to sound the alarms and make this right.

    Comment by Jeremy — April 9, 2020 @ 9:22 am

  2. OK I got shamed to buy SONA so back in:) I just took profits:) its still a bit of a risk due to the technicals..

    Comment by Jeremy — April 9, 2020 @ 10:14 am

  3. Jeremy, thanks for sharing the story about the Whitefish River First Nation. I grew up 20 minutes from there so know the area well. Sounds awful.

    Comment by Danny — April 9, 2020 @ 10:33 am

  4. wow : “the Fed says most of the ETFs it will buy “will be of ETFs whose primary investment objective is exposure to U.S. investment-grade corporate bonds, and the remainder will be in ETFs whose primary investment objective is exposure to U.S. high-yield corporate (junk) bonds”…what’s next from the Fed?…”

    This is the next level of government intervention in the market. Crazy. They continue to kick the can forward, but at some point, all will break loose.

    Comment by rgiroux — April 9, 2020 @ 10:58 am

  5. maybe your immune systems as a white guy and your 3 people to a home w clean water vs how many to a shack w/o proper water, is the issue. IF the virus goes thru most of the FN reserves, did you want to go and tell them there are no respirators or ICU beds available to them ? can you start to guess the cost to ship each one out in a hazmat bag via plane or ambulance to a ‘local’ hospital ? sounds cheaper to do a lock down and keep them away from it . Does sound drastic that land leasers who live there are a risk, but one hopes the community will stand up for them or is possible something in thier behaviour caused this order?

    Comment by david — April 9, 2020 @ 11:00 am

  6. Jon, anything (work) going on with CCW. I was told Frank was on site last week to fine tuning the equipment at the TTL facility. From one of their NR they were going to move their head office there. Is that still the plan? Their web site is still showing 3028 Quadra Court Coquitlam, BC as their head office.

    Comment by Don — April 9, 2020 @ 11:25 am

  7. My gut tells me, Don, we’re on the verge of a big move in CCW starting next week…major update coming on Castle East, which could show the potential for many millions of ounces, but keep in mind also that unlike Quebec, it’s all systems go in Ontario as far as drilling is concerned…great opportunity for CCW to grab a lot of attention…all at a time when Gold and Silver are taking off…

    Comment by Jon - BMR — April 9, 2020 @ 12:13 pm

  8. Wasn’t meant to shame you Jeremy 🙂 Just my strategy that’s all. Good luck in any event and may SONA rise to the top

    Comment by Dan1 — April 9, 2020 @ 12:30 pm

  9. Danny/David .. it is awful.. and they were on lock down. They have full road access and its less than 30 minutes to a hospital. they declared a state of emergency which gave them the right to do this.. just because you can doesnt mean you should???
    makes zero sense to me..
    I had a conversation with a friend who said that they can simply tear up the lease and kick everyone out and take posession of their property while an reprisals.. happened in BC..
    I only bring this up not only for the humanitarian reasons but also because in junior exploration FN’s are almost always involved.
    They dont care about anyone or anything except themselves. Projects can be stopped at a whim.. remember DV??
    There is nothing that can be done.. and we need to be cognizant of the players in any investment.
    There can be no trust amongst FN’s or so it seems.
    Dont worry about things that you cant control… not working well here.. totally off base reaction IMHO…

    Comment by Jeremy — April 9, 2020 @ 12:31 pm

  10. All in all a pretty good week volume wise especially in the G T. KL over 50. Gotta like that.

    Comment by Laddy — April 9, 2020 @ 1:07 pm

  11. Good volume in pge today with an increase volume over the last three days. Cheap down here with the property they have.

    Comment by DBReese — April 9, 2020 @ 1:08 pm

  12. Dan1/David ..
    David – there was no behaviour.. just ‘them’ telling ‘them’ to get out in 36 hours.. 40 of them.. the reserve is off highway 6 south of Espanola.. no access issues..
    the issues surrounding FN’s are well documented .. they dont want to be helped.. and never forget what happened to DV – the FN’s dont live by the same rules and laws as we have to. in fact they dont live by anything canadian as such. yet they vote..
    speaking in general terms.. and mean no disrespect
    would you evict 40 people from their long term homes in the middle of a pandemic?? in 36 hours?? if you answer yes then….

    Comment by Jeremy — April 9, 2020 @ 4:24 pm

  13. Jeremy. I am trying to understand the issue here. What justification is the band giving them to force them to move? What are the reasons? I grew up in Espanola, kids from Birch Island went to school in Espanola, wasn’t aware of any issue, always thought it was a pretty harmonious relationship but that was a while ago.

    Comment by Danny — April 9, 2020 @ 5:08 pm

  14. Hi Danny.. I cant post the letter here since it is jpg… they have the legal right to unlease which they did temporarily.. the reason given is that non-indeginous peoples are a threat to the band. BS if you ask me.. but .. if you give me an email addy I can send the letter to you..
    an 85 yr old recently widowed lady was packing her car at midnight Wednesday..
    the band should be ashamed at their behaviour. But thats just me..

    Comment by Jeremy — April 10, 2020 @ 5:52 am

  15. Thanks for the info Jeremy, I don’t like posting my home email on a public site but I am fine if Jon sends you my email address. Cheers

    Comment by Danny — April 10, 2020 @ 7:29 am

  16. Jeremey, incredible that this would occur but for some reason doesn’t surprise me…we’re reaching out to the band for official response…

    Comment by Jon - BMR — April 10, 2020 @ 7:44 am

  17. Thx Jon .. I have emailed the source document(s) to you .. so you can send them to Danny if you wish…
    and I am with you mate .. not surprising.. just wrong at every level!!

    Comment by Jeremy — April 10, 2020 @ 7:50 am

  18. Big balls

    Comment by Rick — April 10, 2020 @ 9:15 am

  19. Thanks, Jeremy…

    Comment by Jon - BMR — April 10, 2020 @ 9:50 am

  20. Yup I’m the same, why this would occur and it really doesn’t surprise me, then yet with the blockades and now hearing this they wonder why that people discriminate against them. Makes absolutely no sense.

    Comment by Laddy — April 10, 2020 @ 10:40 am

  21. Jon, what’s your opinion on deflation/inflation in the US? In addition, do you think the DOW needs to retest the low like most other beararkets in the past have done?

    Comment by MacT — April 10, 2020 @ 1:05 pm

  22. Laddy – no kidding eh.. and we do dont we.. not proud of that but I’ll be damned if I support those who dont support themselves. The reserve horror stories are plentiful.. Harper brought in the transperency act and what did we learn from that.. then JT takes it away because they didnt want the public to know how they are abusing the system and their own people..
    They cant have a conscience in my mind..
    Dont want this to turn into a FN bash but… we have to be cognizant of any project that involves them because they can and will throw screws and roadblocks up and request unreasonable compensations but say they want to be partners…
    a likely story!! Remember DV……

    Comment by Jeremy — April 10, 2020 @ 2:17 pm

  23. Oil prices have been the most important factor driving inflationary periods over the last half century, MacT, and what do we have right now? – the lowest Oil prices in 20 years, and a high dollar to boot. What the Fed’s doing is not going to drive inflation, either, because that’s not what the first round of QE did after 2008. We need much higher Oil prices and other shocks to the system (much lower dollar and other events) to get inflation going again. If anything, what we’re facing now is deflation – perhaps even a deflationary spiral. One thing that could eventually get inflation ramping up down the road is a supply shortage of all the metals/elements we use for everything we make,

    Comment by Jon - BMR — April 10, 2020 @ 2:34 pm

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