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July 22, 2020

7 @ 7:00

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

1. Spot Gold has traded between $1,846 and $1,864 so far today, reaching a fresh 9-year high…as of 7:00 am Pacific the yellow metal is up $15 an ounce at $1,856…in a report published yesterday, James O Rourke, commodities economist at Capital Economics, said that his firm now sees Gold prices ending the year around $1,900 an ounce, up from its previous target of $1,600 an ounce (they’ll have to revise that target, too)…Silver, hitting its best levels since October 2013, continues its run after aggressively busting through $20 an ounce…Silver has jumped another 84 cents to $22.16…base metals are off modestly with Copper, Nickel and Zinc trading at $2.92, $5.92 and 98 cents, respectively…Crude Oil is down 46 cents a barrel at $41.46 while the struggling U.S. Dollar Index has retreated another one-fifth of a point to 94.92…the greenback chart looks very weak and this is helping to drive interest in Gold, Silver and other commodities…China-U.S. relations continue to erode after the U.S. abruptly closed the Chinese consulate in Houston…China called the U.S. move an “unprecedented escalation” in U.S-China tensions…the Department of Justice is accusing 2 Chinese nationals, allegedly working on behalf of the Chinese government, of stealing trade secrets and hacking into computer systems of firms working on COVID-19 vaccines…according to the 11-count indictment, Li Xiaoyu, 34, and Dong Jiazhi, 33, conducted a global hacking campaign for more than a decade…more recently, the defendants probed for vulnerabilities in computer networks of companies developing COVID-19 vaccines, testing technology, and treatments, a DOJ statement said…sales of existing U.S. homes jumped nearly 21% in June compared with May, according to the National Association of Realtors…this is the largest monthly gain since the group began tracking the data point in 1968…it came after sharp declines over the past 3 months due to the pandemic…annually, sales were still 11.3% lower…

2. Silver prices have broken through critical $20 resistance, on their way to much higher levels in 2020…Silver has already doubled in price off its Corona Crash low but charts suggest this is only the beginning of a massive bull market move, likely leading to all-time new highs, over the next 1218 months…a vital tool in Silver’s price arsenal going forward is its exposure to the green stimulus, according to BMO Capital Markets“When Silver moves, it moves,” wrote BMO’s analysts Colin Hamilton and Alexander Pearce…“Silver’s potential exposure to green stimulus is now an important tool in its armory, and should we see the same velocity of ETF flows evidenced in recent months continue through Q3 as macro asset allocators look to express ways to play a green recovery, both futures prices and Silver-linked equities should benefit,” Hamilton and Pearce wrote last week…technologies such as 5G and solar panels benefit from fiscal spending, which in turn is boosting Silver prices, the analysts explained…“More than $50 billion of green stimulus has been approved by governments thus far this year, over which roughly three-quarters have been in Europe. But perhaps more impactful has been the recent Biden campaign Clean Energy plan, most notably a zero-carbon power grid by 2035 which would see new wind and solar capacity built to displace thermal generation”…demand for solar technology is important to keep an eye on with Silver playing a vital role as the conductive layer…“This sector consumed roughly 100 Moz of Silver in 2019, and even with ongoing thrifting this is set to be a growth area. Even without stimulus, solar has already been gaining market share from fossil fuels, but this process is now likely to be accelerated,” the analysts stated…Silver’s bullish price trend is finally following in Gold’s footsteps, including the action on the ETF front, which could point to further gains…physically-backed ETF holdings of Silver are up 35% since the start of the year, equivalent to 210 million ounces of Silver, far and away a record…

3. European Union leaders have clinched an “historic” deal on a massive stimulus plan for their coronavirus-throttled economies after a fractious summit lasting almost 5 days…the agreement paves the way for the European Commission, the EU’s executive, to raise billions of euros on capital markets on behalf of all 27 states, an unprecedented act of solidarity in almost 7 decades of European integration…many had warned that a failed summit amid the pandemic would have put the bloc’s viability in serious doubt after years of economic crisis and Britain’s recent departure…French President Emmanuel Macron, who spearheaded a push for the deal with German Chancellor Angela Merkel, hailed it as “truly historic”…leaders hope the 750 billion euro ($857 billion U.S.) recovery fund and its related beefed up budget (Gold will love the spending!) will help repair the continent’s deepest recession since World War II after the coronavirus outbreak shut down economies…while strong in symbolism, the deal came at the cost of cuts to proposed investment in climate-friendly funds and did not set conditions for disbursements to countries, such as Hungary and Poland, seen as breaching democratic values…

4. The Dow is up 49 points as of 7:00 am Pacific...a few disappointing company earnings after the bell yesterday included Snap (SNAP, NYSE), under pressure in early trading after the social media company reported fewer-than-expected daily active users…in Toronto, the TSX is up 28 points – buoyed in part by the Gold Index which has hit a new high of 382, up 5 points…Rogers Communications’ (RCI.B, TSX) Q2 results released this morning showed the telecom company posted a double-digit decline in nearly every metric…total revenue dropped 17% for the 3 months ended June 30, and net income was down by 53% from the same quarter in 2019…in the face of a global pandemic and accompanying economic crisis battering the company’s cash flow, Rogers emphasized that it’s on a strong fiscal footing…Sona Nanotech (SONA, CSE) is up another 17 cents at $9.57 as it rapidly approaches the $10 level for the first time…President Trump in a news conference yesterday referenced the importance of COVID-19 tests that can provide results in less than 15 minutes…“Those are the ones I prefer,” he said…the Venture has gained another 6 points to 701…many Silver stocks continue to gain momentum…Sprott-related plays such as Dolly Varden (DV, TSX-V), Discovery Metals (DSV, TSX-V) and Kootenay Silver (KTN, TSX-V) are hitting new highs…Silver’s intense move will particularly benefit companies in production and those with NI 43101 resources…on that note, no company in Canada has a Silver resource grade that matches Canada Silver Cobalt’s (CCW, TSX-V) maiden Inferred resource at Castle East…such a high concentration of metal in a relatively confined area, with plenty of room for new discoveries, makes it a particularly intriguing opportunity in a very bullish Silver environment…Antler Gold (ANTL, TSX-V) has closed a $3 million financing to drill its promising Erongo Gold Project in Namibia, adjacent to Osino Resources‘ (OSI, TSX-V) discovery…

5. GoldON Resources (GLD, TSX-V) got some joy in 1 hole in particular from a 7-hole program of drilling at its West Madsen claims adjoining Pure Gold’s (PGM, TSX-V) Red Lake mine property, the highest-grade underground development project in Canada with first Gold production slated for Q4GoldON has the right to earn a 100% interest in West Madsen through an option agreement with Great Bear Resources (GBR, TSX-V)…the drill program tested a major structural break associated with known Gold deposits on the adjacent Pure Gold property and the producing mines in the Red Lake Camp, and drill hole WM-2005 intersected 14.4 g/t Au over 0.5-m hosted by strongly altered mafic volcanic rocks of Balmer Stratigraphy, with observed visible Gold…this is the first time that the Balmer Assemblage (important to the district) has been identified in drill core on the property and clearly defines a new prospective exploration corridor extending west from Pure Gold’s Wedge zone…Chris Taylor, President and CEO of Great Bear said, GoldON has just crossed a discovery threshold that many junior companies struggle to reach. These results validate our exploration models, which predicted the Balmer Assemblage would be present on the West Madsen property, projecting west from the Madsen mine. The discovery of Gold mineralization in multiple drill holes, including high-grade Gold, clearly shows the potential of the project. As GoldON shareholders and future royalty holders of the West Madsen project, we are very pleased to see these positive developments and are looking forward to seeing further drill results from West Madsen, and to testing Great Bear’s other regional exploration targets at the Sobel, Dedee and Pakwash properties”GoldON is off 2 pennies at 63 cents on the news…the company has only 17 million shares outstanding…

6. GoGold Resources (GGD, TSX) has cut 16.7 m of 368 g/t Silver equivalent, consisting of 1.3 g/t Au and 268 g/t Ag, at its Los Ricos South Project…hole LRGG-20192 was drilled on section 875N in the Rascadero area of the project and intersected the Los Ricos quartz vein from at a shallow depth between 43.7 m to 63.7 m…the intercept included 5.4 m of 923 g/t Silver equivalent…“The Rascadero area continues to return significant drill intercepts and the first holes into Las Lamas warrant additional drilling,” stated President and CEO Brad Langille…“We have passed the data cut-off for the resource, as such these results will not be included in the initial resource, but we will continue to drill at Los Ricos South which could add additional ounces prior to completion of a preliminary economic assessment”…the initial 2 holes drilled at the Las Lamas area found mineralization, with hole LRGG-20194 intercepting multiple sections of mineralized quartz vein near surface…these holes, although moderate grade, indicate the surface structure has divided into 3 structures at depth, and warrant additional drilling to potentially find enriched areas of the structures…

7. Pfizer (PFE, TSX-V) and BioNTech (BNTX, NYSE) have signed a $1.95 billion agreement with the U.S. Department of Health and Human Services and the Defense Department to secure hundreds of millions of doses of a coronavirus vaccine, which Americans would receive free…under the agreement, the U.S. government would receive 100 million doses of BNT162, the COVID-19 vaccine candidate jointly developed by Pfizer and BioNTech, and can acquire up to 500 million additional doses…Pfizer would make the vaccine…the BNT162 program is based on BioNTech’s proprietary mRNA technology and supported by Pfizer’s global vaccine development and manufacturing capabilities…the BNT162 vaccine candidates are undergoing clinical studies and aren’t currently approved for distribution anywhere in the world..the Pfizer-BioNTech vaccine development program is evaluating at least 4 experimental vaccines…if the studies are successful, Pfizer and BioNTech expect to seek emergency use authorization or some form of regulatory approval as early as October…polls have shown that about 20% to 25% of Americans and Canadians would not take a vaccine…

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  1. Sona got named dropped at the Rockefeller conference today. Go Sona!

    Comment by Dan1 — July 22, 2020 @ 8:48 am

  2. Need a big fat NR from CCW about now and we may finally see it break above a buck and stay there.. cmon Matt!

    Comment by GREGH — July 22, 2020 @ 9:06 am

  3. Correction, no name drop but antigen test and specifically was the emphasis and the absolute need for it.

    Comment by Dan1 — July 22, 2020 @ 9:16 am

  4. Jon What do you think of the trading the last couple days for CCW? They have a great run up then a sell off. I know the .90 warrants are due in a couple days, could that be part of the way CCW has been trading the last couple days?

    Comment by Don — July 22, 2020 @ 9:18 am

  5. Some pretty wild trading, Don…my best guess is that there are some games being played here…interesting that this volatility has coincided with Silver’s move thru $20 and a 2nd rig starting at Castle East…when I see activity like this, it makes me think someone (or some group, more specifically) has a big appetite for this opportunity and is playing games in the market with a certain agenda…keep focused on what’s really critical which is the Inferred resource at Castle East…it’s a very unique, extraordinary situation…250 oz/ton Silver with a plan to access it with a ramp…CAPEX would be ridiculously low…and of course, big expansion potential with the very large amount of untested diabase…

    Comment by Jon - BMR — July 22, 2020 @ 9:27 am

  6. Jon,

    Do you think it makes sense to trade GGI for CCW right now? Which one has a better chance for a big payoff?

    Comment by Marshall — July 22, 2020 @ 9:37 am

  7. GGI hasn’t enjoyed its move yet this summer, Marshall, so if you sell you need to keep in mind u may see it quite a bit higher in just a few weeks…

    Comment by Jon - BMR — July 22, 2020 @ 10:22 am

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