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1. Spot Gold has traded between $1,716 and $1,731 so far today after yesterday’s brief dip below $1,700…as of 7:00 am Pacific the yellow metal is up $10 an ounce to $1,720…reflecting sentiment, SPDR Gold Trust holdings, the world’s largest Gold-backed exchange-traded fund, rose another 0.2% to 1,119.05 tonnes yesterday, a 7-year high…the U.S. and Germany accounted for most of the Gold exports out of Switzerland last month…Swiss trade data showed a marked change from the norm as key Asian Gold-consuming nations imported almost none…Spot Silver, headed for about a 15% gain this month, has added 12 cents to $17.36…Silver should benefit from optimism about increased industrial demand as economies reopen following the Wuhan COVID-19 pandemic at the same time the metal also draws investment demand from those worried about a 2nd wave of the virus…Copper and Nickel are up slightly at $2.41 and $5.52, respectively, while Zinc is steady at 87 cents…Crude Oil is unchanged at $32.81 while the U.S. Dollar Index is up one-quarter of a point to 98.78…first-time claims for unemployment benefits totaled 2.1 million last week, slightly higher than expected but the lowest total since the Corona Crisis began…continuing claims, or those who have been collecting for at least 2 weeks, numbered 21.05 million, a clearer picture of how many workers are still sidelined…that number dropped sharply, falling 3.86 million from the previous week…meanwhile, a Commerce Department report this morning showed that U.S. durable-goods orders fell by a slightly less-than-expected 17.2% during April…
2. The U.S. economy is beginning to recover from shutdowns tied to the Wuhan COVID-19 pandemic, Bank of America CEO Brian Moynihan told CNBC this morning…Moynihan cited consumer spending figures from the millions of households using his lender’s credit and debit cards: While transactions collapsed by about 30% in April, they were down by only 5% to 10% in May…“You’re starting to see the economy come out of the hole,” Moynihan stated in a “Squawk Box“ interview…“You’re seeing us come out of the depths of where we were in April, and that’s good news”…checking accounts below $5,000 in average balances actually had 30% to 40% more money in them compared with 12 weeks ago, he said….
3. China’s rubber-stamp legislature has approved a resolution to impose national-security laws on Hong Kong, overriding the territory’s partial autonomy in a bid to crush anti-Beijing protests that have challenged Chinese leader Xi Jinping…today’s vote marked the end of a weeklong session of Beijing’s National People’s Congress and approved a decision to “establish and enhance the legal framework and enforcement mechanisms for national security” in Hong Kong, state broadcaster China Central Television said…some 2,878 lawmakers voted for the motion, with only 1 dissent…Chinese officials have said the resolution is necessary for safeguarding national security, saying unrest in Hong Kong that started last summer has severely threatened China’s sovereignty…they said Beijing had no choice but to step in to close legislative and enforcement gaps in Hong Kong after the city failed to enact its own legislation against separatist and subversive activities…the U.S. has strongly criticized China’s move, saying it undermines Hong Kong’s freedoms that Beijing promised to keep in place for 50 years when the former British colony returned to Chinese rule in 1997…in a separate issue that could further erode Washington and Beijing relations, already strained over China’s handling of COVID-19, the House sent Trump a bill calling for sanctions against Chinese officials for the detention and torture of Uighur Muslims in the country’s western region of Xinjiang…meanwhile, a B.C. Supreme Court judge has ruled that a critical test in the extradition case of Huawei executive Meng Wanzhou has been met, and the extradition process will continue…in her 23-page decision released yesterday morning, Associate Chief Justice Heather Holmes indicated that taken as a whole, the Huawei CFO’s alleged crimes would appear to constitute a crime in Canada, a principle known as “double criminality”…Meng is charged with bank and wire fraud in the U.S. for allegedly misrepresenting Huawei’s relationship with a subsidiary doing business in Iran to HSBC…
4. International tourism is expected to fall as much as 70% this year, according to the United Nations World Tourism Organization…this would be the biggest drop since records for the metric began in the 1950’s…the drop in business could put 110 million jobs around the world at risk, though it’s possible there could be a boom in travel to rural areas while tourism in typically desirable, and densely packed, destinations falls dramatically…the estimated 70% drop is based on the assumption that countries will begin to open their borders in August…while most European countries appear to be on track to reopen to international travel at the beginning of the summer, countries in other areas, especially Latin America, are still grappling with uncontrolled outbreaks and the borders remain closed…
5. In what has got to be one of the highest average grades for a Silver resource estimate ever published, Canada Silver Cobalt (CCW, TSX-V) came out with a pleasant surprise this morning of a maiden NI 43–101 Inferred resource estimate (after just 9 drill holes including 4 wedges) for its early-stage Castle East (Robinson Zone) discovery in the prolific past producing Gowganda Camp…keep in mind, CCW’s VP Exploration is Matt Halliday, who up until late last year was resource geologist for Kirkland Lake Gold (KL, TSX, NYSE)…Halliday is taking a KL approach to the Gowganda Camp and sees the possibility for volume in Silver ounces that would boggle the mind…the grades at CCW’s Castle East discovery are truly exceptional…the maiden NI 43–101 Inferred resource estimate for the newly-discovered Robinson Zone grades an incredible 8,582 g/t Ag (250 oz/ton) in sections 1A and 1B in 27,400 tonnes for 7.6 million ounces at a cut-off grade of 258 g/t AgEq and a vertical depth of approximately 400 m…a 3rd section is Cobalt-rich…mineral resources which are not mineral reserves do not have demonstrated economic viability, of course, but wow – a mineralized body with an average grade of 250 oz/ton Silver is remarkable, and there are ways to relatively quickly extract that in a proven mining camp such as Gowganda…the Inferred resource estimate does not include the discovery of a potential 2nd major vein structure approximately 95 m below the Robinson Zone – CCW has clipped another extremely high-grade vein with drill hole CS-20-22 returning 8,338 g/t Ag (243 oz/ton) over a core length of 0.35 m…the discovery remains open in all directions, and we should be hearing again from CCW shortly regarding follow-up drilling and other plans…the Robinson Zone discovery falls within a much broader and productive horizon associated with a 300-m thick Silver-rich sill, within 2 km of 3 significant past producers along the western edge of the Nipissing diabase in the Gowganda Camp…
6. The Dow is up 53 points as of 7:00 am Pacific…in Toronto, the TSX is 10 points higher while the Venture is up 5 points at 546 and continues to lead all markets to the upside, a bullish sign…Sona Nanotech (SONA, CSE) was strong out of the gate this morning, up 16 cents at $1.88 and building on the breakout above a flag formation…the current earnings season shows that Canada’s big banks have been wrong-footed by COVID-19…National Bank of Canada CEO Louis Vachon describes the current environment “as going where no one has gone before. So this is Star Trek finance”...he added, “The episode is not over…still watching for the Klingons”…most economists have concluded it will take a vaccine to get things truly back to normal, and that discovery remains a ways off…Vachon’s comments came after National Bank reported $379 million in net income for the 3 months ended April 30, a 32% decrease from the same quarter last year…National’s peers have reported similar drops in profit this week, as COVID-19 has forced the big banks to set aside bigger piles of cash to cover possible loan losses…there is a chance that lenders will have to keep adding to reserves in coming quarters…NexGen Energy (NXE, TSX) has closed its previously announced $30 million (U.S.) financing with Queen’s Road Capital Investment (QRC) comprising $15 million (U.S.) of common shares of NexGen and $15 million (U.S.) aggregate principal amount of unsecured convertible debentures…Yamana Gold (YRI, TSX; AUY, NYSE) has completed the previously announced sale of its royalty portfolio to Nomad Royalty (formerly Guerrero Ventures) for $65 million…Yamana said it received $10 million in cash plus $45 million in common shares of Nomad at a price of 90 cents per share…in addition, Yamana has the right to receive an additional $10 million through a deferred cash payment that can be paid in cash or shares of Nomad…Yamana said the deal gives it immediate cash value for non-core assets and medium-term value growth through shares in a newly created, growth-oriented company…Nomad is expected to begin trading on the TSX as early as tomorrow under the symbol NSR…
7. The International Energy Agency (IEA) believes the coronavirus pandemic has paved the way for the largest decline of global energy investment in history, with spending set to plummet in every major sector this year…in the group’s annual World Energy Investment report, published yesterday, the IEA said that the unparalleled decline in worldwide energy investment had been “staggering in both its scale and swiftness”…it warned the economic impact of the public health crisis could have “serious” implications for energy security and clean energy transitions…“The historic plunge in global energy investment is deeply troubling for many reasons,” Fatih Birol, executive director at the IEA, said in a statement…“It means lost jobs and economic opportunities today, as well as lost energy supply that we might well need tomorrow once the economy recovers,” he continued…“The slowdown in spending on key clean energy technologies also risks undermining the much-needed transition to more resilient and sustainable energy systems”…at the start of 2020, the IEA said global energy investment was on pace for growth of around 2%, reflecting the largest annual rise in spending in 6 years…but, after the Wuhan COVID-19 crisis brought large swathes of the world economy to a halt in a matter of months, the IEA said it now expects global investment to tumble by 20% compared to last year…a combination of falling demand, lower energy prices and a rise in cases of non-payment of bills means that energy revenues going to governments and industry are set to fall by “well over” $1 trillion in 2020…Oil accounts for most of this decline, the group continued, adding that, for the first time, global spending on Oil was set to fall below the amount spent on electricity…
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