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1. Spot Gold traded as low as $1,719 this morning before climbing back to $1,740 following the release of fresh economic data that included a whiff of inflation, music to Gold investors’ ears…as of 7:00 am Pacific the yellow metal is off just $1 an ounce at $1,738…Silver has paired its losses as well, now down only 9 cents at $18.04…Fed officials concluded their 2-day meeting yesterday with a dovish statement and a promise of near-zero rates for an extended period…“We’re not even thinking about thinking about raising rates,” Fed Chairman Jerome Powell stated…“What we’re thinking about is providing support for the economy. We think this is going to take some time”…along with the rate decision, central bankers projected that the economy will shrink 6.5% in 2020 (slightly worse than yesterday’s OECD forecast), a year that saw an unprecedented halting of business activity in an effort to combat the Wuhan COVID-19 pandemic…however, 2021 is expected to show a 5% gain followed by a 3.5% advance in 2022, both well above the economy’s longer-term trend…the central bank repeated its commitment from the April meeting that it “expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals”…the Fed also said it will continue to increase its bond holdings, targeting Treasury purchases at $80 billion a month and mortgage-backed securities at $40 billion…Goldman Sachs on Gold: “The situation resembles the 1st half of 2009 when despite continued economic recovery and higher stock prices, Gold and real rates remained range bounded as the Fed maintained ultra-easy monetary policy. Eventually Gold broke out higher in Q3 2009 in line with the move lower in real rates as inflation expectations increased outpacing a rise in nominal rates. We believe that a similar dynamic can play out today with the repricing of inflation expectations being the catalyst for a move up in Gold“…base metals have retreated modestly after pushing higher in recent sessions…Copper is off 3 pennies at $2.60…Nickel is down 15 cents at $5.75 while Zinc is off slightly at 90 cents…Crude Oil has slipped $3.44 a barrel to $36.16 while the U.S. Dollar Index has fallen one-third of a point at 96.28…White House and Republican negotiators are not planning to hold formal negotiations on a 4th coronavirus stimulus package until late July, when Congress returns from recess…the Senate and House of Representatives will return to Washington on July 21, 10 days before certain programs under the CARES Act, such as increased unemployment insurance payments, are set to expire…GOP lawmakers and the Trump administration are now armed with encouraging data on unemployment and calculations showing that much of previous stimulus money remains unspent…
2. Two separate sets of economic data were released this morning…the number of people seeking unemployment benefits in the United States continued to fall while those receiving benefits appeared to plateau, signs the labor market continues to slowly mend from the coronavirus employment shock…the ranks of Americans drawing on unemployment benefits declined slightly in the week ended May 30 to 20.9 million…so-called continuing claims remain historically high but have stabilized in recent weeks after peaking in early May…meanwhile, the Labor Department also announced that its Producer Price Index (PPI) rose 0.4% in May, following April’s drop of 1.2%…economists were forecasting a rise of only 0.1% in May, so the hint of inflation brought buyers back into Gold and Silver after some overnight weakness…
3. Treasury Secretary Steve Mnuchin said this morning that shutting down the U.S. economy for a 2nd time to combat the spread of the Wuhan COVID-19 virus isn’t a viable option and could cause even more headaches for Americans…“We can’t shut down the economy again. I think we’ve learned that if you shut down the economy, you’re going to create more damage,” Mnuchin told CNBC’s “Squawk on the Street”…“And not just economic damage, but there are other areas and we’ve talked about this: Medical problems and everything else that get put on hold,” he added…“I think it was very prudent what the President did, but I think we’ve learned a lot”…the Treasury secretary’s comments came as Wall Street grew more concerned about a potential 2nd wave of coronavirus cases in the United States…Texas has reported 3 consecutive days of record-breaking COVID-19 hospitalizations, while 9 California counties are reporting a spike in new cases or hospitalizations of confirmed cases…
4. Great Bear Resources (GBR, TSX-V) has drilled into its highest grade, widest Gold interval yet at the LP Fault at its 100%-owned Dixie Project in the Red Lake District – 31.3 g/t Au over 20.55 m, including 576 g/t (18.5 ounces per tonne) over 1 m…Chris Taylor, President and CEO, commented: “Drill hole BR-137…was completed in a 90-m-long long previously undrilled segment of the LP Fault…more importantly, all adjacent drill holes, both vertically on the same section and laterally along strike, are also strongly mineralized over significant widths, suggesting excellent continuity of high-grade Gold mineralization”…the company has completed 115 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…new drill hole BR-137 on section 20000 was completed in a 90-m gap in drilling…it intersected multiple mineralized intervals along 258.4 m of core length…intense alteration and deformation in BR-137 and surrounding drill holes includes strong silicification and partial to complete obliteration of primary rock textures…Gold mineralization occurs within disseminated planes or sheets that are parallel to the dominant structural fabric and appear to be vertically and laterally continuous between drill holes on the same drill sections…GBR is up 78 cents at $12.98 as of 7:00 am Pacific…
5. Also in prolific Northern Ontario, Canada Silver Cobalt’s (CCW, TSX-V) Phase 2 drilling has quickly broadened out the most significant high-grade Silver discovery in that region in at least 40 years by intersecting a nearly 50-m extension to the Robinson Zone toward surface in drill hole CS-20–24…the most westerly drilled hole targeting the Robinson Zone, CS-20–24 hit 3 well-mineralized vein structures including one filled with native Silver and Cobalt arsenides starting around 370 vertical m, 47 m above the original discovery that formed the recently released maiden Inferred resource (7.56 million ounces grading 202 oz/ton in 27,400 tonnes of material in zones 1A and 1B, using a cut-off grade of 258 g/t AgEq)…a series of wedge holes will be drilled beginning early next week aimed at following the trail of native Silver veins encountered in drill holes CS-20–22 and CS-20–24…targeting (accuracy) is much easier with wedge holes, as CCW demonstrated last winter, so these wedges could get into some really spectacular Silver and further build out this rare discovery…keep in mind, CS-20–22, one of the last holes completed over the winter, hit over 200 oz/ton Silver in a new vein nearly 100 m below the Robinson Zone, meaning the vertical extent of incredibly high-grade native Silver veins is now 144 m at this early stage…(CS-20–20 was not included in the maiden Inferred resource estimate)…Matt Halliday, CCW VP-Exploration who joined the company late last year from Kirkland Lake Gold (KL, TSX, NYSE), stated: “With the first hole of Phase 2 we’ve already opened up much more room for expansion of the very high-grade Robinson Zone, and many more high-priority targets remain to be drilled. This appears to be a pregnant system with strong potential for significant additional lateral and vertical extent given the increasing success we are having at hitting these narrow but exceptionally high-grade vein structures from surface. We eagerly anticipate the first batch of assays from CS-20–24“…total volume of the untested diabase at Castle East is estimated to range between 970 million and 1.45 billion cubic meters, as much as 20 x the estimated volume of the diabase at the adjacent Castle mine which produced about 10 million ounces of Silver and also remains open for expansion…CCW is up 2 pennies at 54 cents…a “Golden Cross” has occurred in the stock with the rising 50-day SMA crossing above the rising 200-day SMA…the same technical event led to a 70% jump in CCW late last year into January…
6. The Dow has plunged by more than 700 points in early trading, putting the index on pace for its first 3-day losing streak in a month and for its biggest 1-day drop since April 1…the S&P 500 is headed for its longest losing streak since early March…”reopening” stocks are under pressure while Netflix (NFLX, NASDAQ) and Zoom Video (ZM, NASDAQ) – 2 stocks that have benefited from consumers staying at home during the pandemic – are up slightly…DarioHealth (DRIO, NASDAQ), a pioneer in the global digital therapeutics market, is also bucking the trend this morning…it’s pushing higher (up 98 cents at $6.88 on a big jump in volume) after announcing that it has signed its first 2 remote patient monitoring (RPM) agreements…remote patient monitoring will allow treating physicians to continue to be the primary source of medical advice for patients in between office visits, potentially preventing unnecessary and unplanned hospital visits…in Toronto, the TSX has retreated 303 points while the Venture is 6 points lower at 561…Silvercorp Metals (SVM, TSX) has pulled out of the race to acquire Guyana Goldfields (GUY, TSX)…Artemis Gold (ARTG, TSX-V) has enjoyed a strong week after cutting a deal with New Gold (NGD, TSX) to acquire the multi-million ounce Blackwater deposit in central British Columbia…ARTG is taking a breather in early trading, off 2 pennies at $2.98…Else Nutrition (BABY, TSX-V) has hit a new high in early trading, up 24 cents at $1.64…Gatekeeper Systems (GSI, TSX-V) has been contracted to equip approximately 215 school buses in Halifax with intelligent video recording solutions…together with the contract announced June 2…Gatekeeper’s systems will be installed on approximately 360 school buses in the Halifax Regional Center for Education, which is the largest school system in Atlantic Canada, serving 52,000 students in 135 schools…the use of video on school buses is growing rapidly…in February 2020, the Council of Ministers Responsible for Transportation and Highway Safety released the Strengthening School Bus Safety in Canada report from the federal, provincial and territorial Task Force on School Bus Safety, which developed a set of prioritized recommendations for the Council of Ministers to consider…the Task Force recommends that all jurisdictions explore the application of safety measures which include Stop Arm Cameras to help prevent dangerous incidents caused by passing motorists, and 360-degree cameras as a means of better detecting and protecting children and other vulnerable road users around the exterior of the bus…the report estimates that 2.2 million Canadian school children travel to and from school every day on Canada’s 51,670 school buses…lots of potential business for Gatekeeper…
7. The Red Chris mine in Northwest B.C. is showing its potential for significant additional high-grade tonnage…Newcrest Mining (NMC, ASX) and Imperial Metals (III, TSX) announced this morning that follow-up drilling continues to confirm the continuity of a discrete pod of high-grade mineralization in the vicinity of RC09–350 and RC611…drill hole RC623, drilled to intersect the high-grade pod 100 m above RC611, cut 232 m grading 2.6 g/t Au and 1.5% Cu that included a 122-m interval grading 4.5 g/t Au and 2.3% Cu…hole RC620, drilled 100 m below RC611, has confirmed the extent of the +1 g/t Gold halo which surrounds the high-grade pod…follow-up infill drilling continues to define the extent of this mineralization…hole RC616 confirmed a broad zone of high-grade mineralization with an intersection of 514 m grading 0.81 g/t Au and 0.57% Cu which includes the previously reported 80-m interval of high grade that assayed 3.4 g/t Au and 1.7% Cu…this high-grade zone was not intersected by previous drilling and confirms the potential of finding additional discrete high-grade pods of mineralization within the East zone…follow-up drilling to define the extent of the RC616 high-grade zone is underway…a total of 40,069 m of drilling has been completed since Newcrest acquired its interest in the joint venture in August 2019…drilling continues to refine the overall geometry of the system and controls to high-grade Gold-Copper mineralization within a subvertical zone approximately 600 m long, 300 m wide and 600 m deep…mineralization is supported by extensive historical drilling data…on completion of the East zone resource definition program, Newcrest intends to construct a new resource model incorporating both historical and Newcrest drilling data…
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