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1. Gold has traded between $1,331 and $1,342 so far today…as of 7:00 am Pacific, bullion is down $6 an ounce at $1,333…Silver has slipped 27 cents to $17.06…Silver has Fib. resistance at $17.28 on the short-term chart (followed by resistance at the October $17.59 high) but the overall technical pattern is constructive with the 200-day moving average (SMA) acting as support around $17…Copper is off 7 cents at $3.18 while Nickel has retreated 18 cents to $5.66…Crude Oil is off 22 cents at $64.08 while the U.S. Dollar Index has rallied one-third of a point to 90.77 but still looks technically weak…downside momentum favors the Dollar Index pushing below 90 toward an uptrend line around 87 from 2011…while many commodity analysts are bullish on Gold in a weaker U.S. dollar environment, it’s important to note that bullion has outperformed most major currencies in the last month…the metal has appreciated 8% against the greenback, 5% against the yen and yuan, 4.5% against the pound and 4% against the euro…
2. Reacting to Crude Oil’s 3-year high, Russian Energy Minister Alexander Novak says the Oil market is not yet balanced and that the global deal to cut output should continue as the price rise could be due to cold weather (“climate change” gets blamed for everything)…Goldman Sachs seems to have changed its tune, however, saying the jump in Oil prices “has been driven first by robust fundamentals, with strong demand growth and high OPEC compliance accelerating…we see increasing upside risks to our $62 per barrel Brent and $57.5 per barrel WTI forecast for the coming months.” Goldman is doing some backtracking, but at BMR we’ve maintained since last year that WTI is headed into the $70’s based on highly favorable technical patterns in addition to improving fundamentals…
3. As U.S. equity markets continue their best ever start to a year, respondents to the January Bank of America Merrill Lynch Fund Manager Survey are showing that optimism has not dimmed, even after 2017’s big 20% gain…hedge fund managers say their own equity exposure – 49% net long – is at the highest since 2006 as the level dedicated to hedging strategies against a possible market downturn falls to its lowest since 2013…at some point this party will end, but momentum in corporate earnings, accelerating economic growth, large tax cuts, deregulation and very high consumer confidence levels have all combined to make the perfect recipe for a buoyant stock market…any significant dips will be quickly embraced…
4. A sign of the times – online shopping sales hit a record $108.2 billion during the U.S. holiday season, a whopping 14.7% increase from last year, according to Adobe Analytics…the National Retail Federation previously said total sales for November and December were $691.9 billion, a 5.5% jump from last year…
5. U.S. equity markets are surging in early trading after yesterday’s holiday…the Dow is up 269 points as of 7:00 am Pacific, pushing above the 26,000 level for the first time…it took the Dow just 12 calendar days to move from 25,000 to 26,000, making it the fastest 1,000-point move on record for the index…in Toronto, the TSX is not faring so well with commodities a little soft this morning…the TSX is down 26 points through the first 30 minutes of trading…the Venture, meanwhile, has climbed 5 points to 891…the 885 area could be forming as nearest support, but a very strong band of secondary support exists from 870 to the key 850 breakout point…Castle Silver Resources (CSR, TSX-V) has hit another new multi-year high of 55 cents as the company expands its underground Cobalt program at the Castle mine in northern Ontario…Fission Uranium (FCU, TSX) has started preparations for a $9.4-million winter work program at its Patterson Lake South Project in Canada’s Athabasca basin…the 31-hole program will focus on expanding the recently discovered, high-grade R1515W zone and accelerating progress toward the prefeasibility study, a key milestone for potential eventual production at PLS…FCU has rallied strongly since the end of October…Golden Predator Mining (GPY, TSX-V) has released results of 43 grade control drill holes at its 3 Aces Project in southeastern Yukon, including the highest Gold assays returned to date such as 81.3 g/t over 4.6 m from a depth of 0.76 m 3A17–208…
6. eCobalt Solutions (ECS, TSX) says it has made significant progress in identifying strategic off-take partners for its clean Cobalt concentrate from its Idaho Cobalt Project…due diligence is currently in progress as the company works towards negotiating definitive terms in parallel with continued advancement of the project, the only environmentally permitted, near-term primary Cobalt deposit in the United States…“Marketing of the ICP and clean Cobalt concentrate during the past few months has been successful and has culminated in the receipt of multiple proposals for off-take arrangements,” stated Paul Farquharson, President and CEO of eCobalt. “This demonstrates the increasing demand for ethically-sourced Cobalt in a supply deficit market. These LOIs present many options with various potential off-take partners. Our goal is to form a long-term partnership with a strong off-take partner who can provide support and flexibility, and deliver value for the ICP. Not only is this a critical component of project financing, but it is also critical for the long-term success of the project.”
7. The price of Bitcoin plunged by as much as 20% today amid concerns about tighter regulation, with the volatile virtual-currency dipping below $12,000 for the first time since early December…Bitcoin prices surged to record highs late last year as traders prepared for the launch of futures contracts on the Cboe and CME…contracts trading on the Cboe are scheduled to expire tomorrow for the first time since they launched, a process that can lead to more volatile trading, and “backwardation” has also occurred which can be a bearish sign for an asset..today’s fall also comes in the wake of attempts by various governments to tighten control over cryptocurrency trading, such as in South Korea where trading of Bitcoin has been particularly popular…last week Chinese authorities ordered some large Bitcoin mining operations to close…
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The recent drop in Bitcoin is irrelevant with respect to both Bitcoin and FTEC. Realistically, Bitcoin could hit $100K before the end of this year. I expect us to see AT LEAST a price between $20K-$30K for Bitcoin in 2018. FTEC is poised for greatness and everyone is anxiously awaiting all 5,000+ locations to be fully activated. Great buying opportunity for both.
Comment by Raffi14 — January 16, 2018 @ 9:51 am
Jon if bitcoin continues to fall will it not affect tech stocks such as DM? How would it fare for the block-chain stocks out there?
Thank you
Comment by TradingAgent — January 16, 2018 @ 9:54 am
I guess the GGI market makers have seen the light and no longer want to do battle with Mr. Sprott.
Comment by Marshall — January 16, 2018 @ 10:05 am
Jon isn’t ecobalt sort of doing the same thing as CSR is doing with their re-2ox program? or is this totally something else?
thanks
“Marketing of the ICP and clean Cobalt concentrate during the past few months has been successful and has culminated in the receipt of multiple proposals for off-take arrangements,” stated Paul Farquharson, President and CEO of eCobalt. “This demonstrates the increasing demand for ethically-sourced Cobalt in a supply deficit market. These LOIs present many options with various potential off-take partners. Our goal is to form a long-term partnership with a strong off-take partner who can provide support and flexibility, and deliver value for the ICP. Not only is this a critical component of project financing, but it is also critical for the long-term success of the project.”
Comment by GREGH — January 16, 2018 @ 10:08 am
so what just happened with DVR??? yikes:) up 14
Comment by Jeremy — January 16, 2018 @ 10:56 am
DVR – they hired FCC a wk ago. kicking in is a guess. didn’t come cheap, but they have a book
Comment by David — January 16, 2018 @ 11:54 am
Sherritt – doing a PP linked to COBALT
Sherritt Announces $100 Million Unit Offering Comprised of Common Shares and Cobalt-Linked Warrants
TORONTO — (Business Wire) —
Sherritt International Corporation (“Sherritt”) (TSX:S):
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Sherritt International Corporation (“Sherritt”) (TSX:S) today announced a proposed $100 million offering of units (the “Offering”). Each unit (a “Unit”) shall consist of one common share (a “Common Share”) and one-half of one common share purchase warrant linked to the price of cobalt (each full warrant, a “Cobalt-Linked Warrant”). Each Cobalt-Linked Warrant will be exercisable to acquire between 1.00 and 1.25 common shares of Sherritt, determined based on the Applicable Cobalt Reference Price (as defined below). The Units have been structured to provide investors with increased leverage to upwards movement in the price of cobalt.
Paradigm Capital, Eight Capital and National Bank Financial are acting as co-lead agents and joint-bookrunners on behalf of a syndicate (collectively, the “Agents”). The Offering is being made on a best efforts basis and final pricing terms will be determined in the context of the market. Sherritt has granted to the Agents an option to offer for sale units in an amount up to an additional 15% of the Offering, exercisable in whole or in part at any time until the date that is 30 days after initial closing of the Offering, at the issue price, to cover over-allotments and for market stabilization purposes. The Common Shares and Cobalt-Linked Warrants will be qualified in each Canadian province and territory by way of a prospectus supplement to Sherritt’s base shelf prospectus dated April 15, 2016. The Offering will also be made available to offshore investors pursuant to relevant prospectus or registration exemptions in accordance with applicable laws.
Each Cobalt-Linked Warrant will entitle the holder thereof to acquire that number of Common Shares that is equal to the Common Shares per Warrant Ratio (as set out in the table below). The initial Common Shares per Warrant Ratio will be one share to one warrant based on an initial Applicable Reference Cobalt Price of US$34.99 per pound or lower.
The Common Shares per Warrant Ratio will be determined and published monthly based on the Applicable Reference Cobalt Price per Pound in accordance with the following table:
Applicable Reference Cobalt Price per Pound
Common Shares per Warrant Ratio
US$34.99 or lower
1.00
US$35.00 – US$39.99
1.05
US$40.00 – US$44.99
1.10
US$45.00 – US$49.99
1.15
US$50.00 – US$54.99
1.20
US$55.00 and higher
1.25
The “Applicable Cobalt Reference Price per Pound” will be calculated and published by Sherritt monthly, based on a rolling average of the prior three months cobalt price using the midpoint of the Metal Bulletin High Price and the Metal Bulletin Low Price,1 expressed in US dollars per pound, for each month in such three-month period. Each Cobalt-Linked Warrant will be exercisable at an exercise price to be determined in the context of the market and shall be exercisable for a period of 36 months following the closing of the Offering.
The net proceeds of the Offering shall be used to reduce Sherritt’s outstanding indebtedness, for general corporate purposes and to fund future growth initiatives. Sherritt intends to use up to $75 million of the proceeds of the Offering and its existing cash balance to repurchase a portion of one or more of its senior unsecured debentures (the “Debentures”). The Debentures will be repurchased under the terms of a modified Dutch auction tender offer (the “Tender Offer”). For further details of the Tender Offer, investors are advised to consult Sherritt’s press release dated January 16, 2018, entitled Sherritt Announces Dutch Auction to Purchase up to $75 Million of Outstanding Debentures.
The Offering is subject to satisfaction of customary closing conditions, including the receipt of all necessary regulatory and TSX approvals. The Offering is expected to close on January 25, 2018.
The securities described herein have not been, and will not be, registered under the U.S. Securities Act, or any state securities laws, and accordingly, may not be offered or sold to, or for the account or benefit of, persons in the United States or to U.S. Persons (as such term is defined in Regulation S under the U.S. Securities Act), except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of Sherritt’s securities to, or for the account or benefit of, persons in the United States or U.S. Persons.
About Sherritt
Sherritt is a world leader in the mining and refining of nickel and cobalt from lateritic ores with projects and operations in Canada, Cuba and Madagascar. The Corporation is the largest independent energy producer in Cuba, with extensive oil and power operations across the island. Sherritt licenses its proprietary technologies and provides metallurgical services to mining and refining operations worldwide. The Corporation’s common shares are listed on the Toronto Stock Exchange under the symbol “S”.
http://www.sherritt.com
Forward-Looking Statements
This press release contains certain forward-looking statements. Forward-looking statements can generally be identified by the use of statements that include such words as “believe”, “expect”, “anticipate”, “intend”, “plan”, “forecast”, “likely”, “may”, “will”, “could”, “should”, “suspect”, “outlook”, “projected”, “continue” or other similar words or phrases. Specifically, forward-looking statements in this document include, but are not limited to, statements set out in this press release relating to estimated costs and future funding requirements.
Forward-looking statements are not based on historic facts, but rather on current expectations, assumptions and projections about future events, including matters relating to the transaction disclosed herein; availability of governmental, regulatory and third party approvals; and the ability to achieve corporate objectives, goals and plans for 2018. By their nature, forward-looking statements require the Corporation to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that those assumptions may not be correct and that actual results may differ materially from such predictions, forecasts, conclusions or projections.
The Corporation cautions readers of this press release not to place undue reliance on any forward-looking statement as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to the risks and uncertainties set out in the Management’s Discussion & Analysis of the Corporation for the period ending September 30, 2017 and the Corporation’s Annual Information Form dated March 28, 2017, each of which are available on SEDAR at http://www.sedar.com.Readers are cautioned that the foregoing list of factors is not exhaustive and should be considered in conjunction with the risk factors described in this press release and in the Corporation’s other documents filed with the Canadian securities authorities.
The Corporation may, from time to time, make oral forward-looking statements. The Corporation advises that the above paragraph and the risk factors described in this press release and in the Corporation’s other documents filed with the Canadian securities authorities should be read for a description of certain factors that could cause the actual results of the Corporation to differ materially from those in the oral forward-looking statements. The forward-looking information and statements contained in this press release are made as of the date hereof and the Corporation undertakes no obligation to update publicly or revise any oral or written forward-looking information or statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. The forward-looking information and statements contained herein are expressly qualified in their entirety by this cautionary statement.
Comment by David — January 16, 2018 @ 1:43 pm
Thoughts on Golden Predator Mining, GPY.
Comment by Ed — January 16, 2018 @ 1:51 pm
I don’t mind seeing some red in CSR. Healthy movement…
Comment by flyinthruu — January 16, 2018 @ 2:43 pm
Yes they did David… but I have never seen a IR firm have almost any effect on any company .. or their SP… if these guys are starting a promotion then yippee:)
Comment by Jeremy — January 16, 2018 @ 3:27 pm
ZIMTU is another hump group that can have influence on a stock once they are on Bd.
Comment by David — January 16, 2018 @ 5:52 pm