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1. Gold dipped as low as $1,584 overnight but has recovered to $1,611 as of 7:00 am Pacific, down $13 for the day…Russia has become the first central bank during the global pandemic to announce it’s suspending its Gold purchases as of April 1…Russia’s economy is suffering as it engages in an Oil price war with Saudi Arabia…the Russian central bank has dominated the Gold market, consistently increasing its reserves every month for the last 3 years…according to data from the World Gold Council, the Russian central bank bought 158.1 tons last year…Silver is relatively unchanged at $13.98…Copper has gained 3 cents to $2.18, Nickel is flat at $5.08 while Zinc is up a penny at 84 cents…Crude Oil, after dipping below $20 a barrel for the first time in nearly 2 decades, is up 31 cents at $20.40…the U.S. Dollar Index has gained one-third of a point to 99.57…factory activity in China unexpectedly expanded in March from a collapse the month before, but analysts caution that a durable near-term recovery is far from assured as the global pandemic knocks foreign demand and threatens a steep economic slump…China’s official PMI rose to 52 in March from a plunge to a record low of 35.7 in February, the National Bureau of Statistics (NBS) claimed today, above the 50-point mark that separates monthly growth from contraction…analysts polled by Reuters had expected China’s March PMI to come in at 45.0…the NBS attributed the surprise rebound in PMI to its record low base in February and cautioned that the readings do not signal a stabilization in economic activity…
2. TD Securities on Gold: “In the immediate term, Gold prices appear to have run ahead of real rates, but looking forward, as the dust settles on COVID’s impact, we expect Gold to perform smartly in the next phase of this narrative. The extraordinary QE package, combined with large government stimulus packages, reek of MMT [Modern Monetary Theory], which should eventually send real rates on a downward trajectory, particularly as global central banks will be willing to let inflation run hot as part of their symmetric targeting framework. This should help cement a multi-year rally in the yellow metal”…
3. TC Energy (TRP, TSX, NYSE) is proceeding with its long-delayed Keystone XL pipeline with a $1.1 billion (U.S.) “strategic investment” from the Alberta government…the province is making a preferred equity investment in the 830,000-barrels-per-day pipeline project that would carry oil from Alberta to the U.S. Gulf Coast, which is home to the largest concentration of heavy Oil refineries in the world…in an interview with the Financial Post, Premier Kenney said the company will begin construction on the long-delayed pipeline export project as early as tomorrow…“This is absolutely critical for our economic future now more than ever,” Kenney said…Oil prices have crashed in the last month as the Wuhan COVID-19 pandemic has triggered a dramatic fall in global demand for Oil…at the same time, Saudi Arabia and Russia have flooded the market with Crude as they engage in a price war…however, Kenney said, the price war in the middle of a health crisis “highlights now more than ever why we need energy independence” and an interconnected North American Oil and gas market…
4. Montreal has emerged as Canada’s Wuhan virus hot spot after an early spring break and close ties to New York and France sowed infections that are rapidly growing into new cases and hospitalizations…Montreal, with about 5% of Canada’s population, has about one-quarter of the country’s COVID-19 cases, according to the latest data published by public health authorities…the province of Quebec, with 22% of Canada’s population, has about half of the country’s cases…Quebec had its biggest single-day increase yesterday with 590 new cases, bringing the total to 3,430…Montreal public health declared a state of emergency and identified hot spots in neighbourhoods, including Côtes-des-Neiges, Notre-Dame-de-Grâce, Côte-Saint-Luc, Rosemont and Plateau Mont-Royal…in several cases, those are neighbourhoods with communities with close ties to New York, Florida and France…public health officials instructed police to enforce the province’s ban on gatherings more closely in those areas…Quebec has rapidly expanded testing and is now capturing milder cases that were not caught under stricter testing criteria a week ago…in recent days, Quebec has averaged about 8,000 tests a day while Ontario has collected about 3,000 samples a day…Quebec has conducted about 808 tests per 100,000 people, more than double the rate of Ontario…
5. Sona Nanotech (SONA, CSE) and a European company have entered into a manufacturing deal for the production of the SONA-led consortium’s Rapid Response Lateral Flow test kits for the Wuhan COVID-19 virus…the test is in the final stages of development and SONA, working with GE, The Native Antigen Company, and Bond Digital Health, expects to complete a functional prototype and confirm 3rd party validation tests in the near future…SONA also announced yesterday that it has signed an LOI with a G-20 country (outside North America) for the purchase of 2 million units…other pre-orders or “expressions of interest” are anticipated shortly, subject in part to test validation…SONA’s efforts may also get a near-term financial boost following discussions with Canada’s federal government regarding potential grants from monies dedicated to the pandemic emergency…“SONA is uniquely positioned, having one of the strongest potential products that could assist the COVID-19 problem,” company director Jim Megann told BMR…SONA hit a new all-time high of $1.30 intra-day yesterday before backing off on profit-taking…it’s down 5 cents at $1.07 through the first 30 minutes of trading today…
6. The Dow is off 161 points as of 7:00 am Pacific…U.S. consumer confidence dropped less than expected in March…the Conference Board said today its consumer confidence index fell to 120 this month from 132.6 in February, bearing the consensus estimate of 110…Goldman Sachs says the economy will go through an unprecedened plunge in the 2nd quarter, but that the recovery would then be the fastest in history…the Dow has posted gains in 4 of the last 5 sessions, easing the losses of what’s shaping up to be its worst 1st quarter ever…in Toronto, the TSX has jumped 280 points while the Venture is 3 points higher at 390…CloudMD Software and Services (DOC, CSE), which yesterday closed the final tranche of a $3 million financing at 48 cents, announced this morning that it has expanded its direct-to-consumer telemedicine app, CloudMD, to service Ontarians…the app, which is free to download and use, allows people to book same-day appointments with a licensed physician in their own province…there has been growing demand for digital health care, as demonstrated by the positive reception CloudMD received from its launch in British Columbia earlier this year…then came the pandemic…Canadians are showing more motivation to seek medical advice virtually, preferring to avoid emergency rooms and clinics….DOC is up a penny-and-a-half at 51 cents as of 7:00 am Pacific…
7. Millions of Americans already have lost their jobs due to the Wuhan virus pandemic, and the worst of the damage is yet to come according to a Federal Reserve estimate…economists at the Fed’s St. Louis district are predicting total employment reductions of 47 million, which would translate to a 32.1% unemployment rate…the projections are even worse than St. Louis Fed President James Bullard’s much-publicized estimate of 30%…they reflect the high nature of at-risk jobs that ultimately could be lost to a government-induced economic freeze aimed at halting the coronavirus spread…“These are very large numbers by historical standards, but this is a rather unique shock that is unlike any other experienced by the U.S. economy in the last 100 years,” St. Louis Fed economist Miguel Faria-e-Castro wrote in a research paper posted last week….a 30% unemployment rate would top the Great Depression peak of 24.9%…the 1 potential bright side is the likelihood that the downturn could be comparatively brief…during a CNBC interview, Bullard said the jobless number “will be unparalleled, but don’t get discouraged. This is a special quarter, and once the virus goes away and if we play our cards right and keep everything intact, then everyone will go back to work and everything will be fine”…we’ll see if it turns out to be that simple…
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Comment by daniel — March 31, 2020 @ 8:39 am