Gold is firmer this morning after yesterday’s weakness that was apparently triggered by a single customer who sold 15,000 contracts shortly after the market opened…still, Gold held important support at $1,700 while Silver held support at $33.50 on a closing basis…as of 7:45 am Pacific, bullion is up $6 an ounce at $1,726 while Silver – looking very strong – has gained 50 cents to $34.27…Copper has shot up 8 cents to $3.59…Crude Oil is sharply higher, up $1.86 a barrel to $88.35 while the U.S. Dollar Index has retreated one-tenth of a point to 80.19…
Industrial demand accounts for around 55% of overall Silver demand, and 2012 was a weak year for industrial demand…so it’s interesting that industrial demand for Silver is now expected to rise by 7% in 2013 to a new record, according to a report from the Silver Institute…it also expects industrial demand for Silver to climb another 6% in 2014…growth in demand should be driven by Silver-oxide-catalyst production and the photovoltaic (solar-to-electrical power) industry…China is expected to play catch-up with the U.S. in terms of industrial demand, with the two nations combining to provide over 40% of industrial demand…
Copper Supplies Tight For First Half of 2012
Copper supply shortages will extend into the first half of next year as an accelerating Chinese economy more than doubles the pace of growth in global consumption even as mines extract a record amount of metal..demand will outpace supply by 316,000 metric tons in the first six months, more than all Copper in London Metal Exchange warehouses, before a surplus emerges in the second half, according to Barclays…production has lagged behind consumption since 2010, according to the International Copper Study Group…China, which uses 41% of the world’s Copper, is rebounding from seven quarters of slowing growth after the government approved a $161 billion subways-to-roads construction plan in September…Barclays estimates that global demand will expand 3.4% to 20.85 million tons next year, from a 1.5% gain in 2012…supply will climb 3.5% to an all-time high of 20.83 million tons…while that means an annual shortage of 19,000 tons, it’s driven by the projected first-half deficit, compared with a surplus of 297,000 tons in the second six months…China’s Copper demand may rise 5.5% to 8.1 million tons, compared to a gain of 4.8 % this year, according to Beijing Antaike Information Development Co. which has researched metals for two decades…
Comparative Chart – CDNX, Gold, Dow, Shanghai Index
Below is a comparative chart from John that covers the last four months…interestingly, Gold and the Dow are closely tracking each other as they are both on the same slope trendlines, while the CDNX and China’s Shanghai Composite Index are also on the same slope trendlines but in the opposite direction…(we’ve noted similarities between these two before)…over the last four months, however, the Venture has still slightly out-performed the Dow…
Shanghai Composite Index Chart Update
Has China’s Shanghai Index hit bottom yet after closing below the 2000 level for the first time in four years?…that’s impossible to say at this point, but importantly the Index is now trading at the bottom of a downsloping wedge where it should have strong support…there’s also a divergence between price and RSI(14) which is bullish…so what this tells us is that “risk off” could be about to switch back to “risk on”, at least for a while…
Encouraging U.S. Economic Data
Weekly U.S. unemployment applications dropped to 393,000 as impact of Superstorm Sandy faded, while gross domestic product growth was revised upward in the third quarter, according to economic data released this morning…the economy grew faster than initially thought in Q3 (2.7% vs. the initial estimate of 2%) as faster inventory accumulation and export growth offset weak consumer spending and the first drop in business investment in more than a year…but the question is whether the momentum can be sustained going into 2013 given the uncertainty in Washington over fiscal policy…meanwhile, buyers are coming back to the housing market in ever greater numbers, as an industry index measuring contracts to purchase existing homes surged 5.2% in October from September…
Fed Official Calls For More Action From Government To Boost Employment
Dallas Fed President Richard Fisher, a top U.S. Federal Reserve official, urged the U.S. government to give businesses more incentives to invest the liquidity the central bank has provided to create jobs…the Federal Reserve said in its Beige Book report yesterday that the U.S. economy had trucked along at a “measured” pace in recent weeks and hiring remained modest…Fisher called for more action from the government to boost employment, saying there were limits to what monetary policy could do…”We at the central bank have been carrying the load and this is a very dangerous predicament,” Fisher, a self-described anti-inflation hawk, said during a lecture in Frankfurt today…”Monetary policy provides simply the fuel, but the incentive has to come from our fiscal authorities,” he added…”The gas tank is full (with liquidity) and now we have to get someone to … step on the accelerator to propel the job creating machine in the United States…there is a limit to what a monetary authority can do…all we can do is provide liquidity”…
Today’s Markets
Markets are stronger across the board today on optimism regarding U.S. budget discussions…Asian markets were mostly higher overnight, though the Shanghai fell another 10 points to close at 1963…European markets were up by roughly 1% today while as of 7:45 am Pacific, the Dow is 38 points higher at 13023…the TSX has gained 59 points while the Venture Exchange is up 10 points at 1215…the CDNX has so far been able to hold support at 1200…if it can hold critical support at 1165 over the next three weeks, to the end of the tax-loss selling period, then it should be in excellent shape technically to finish 2012 on a positive note and start a fresh uptrend to begin 2013 which could include a breakout through the down trendline in place since last year…
Seafield Resources (SFF, TSX-V)
It has been a while since we’ve provided an updated chart for Seafield Resources (SFF, TSX-V) which has been driven down to important support with the recent weakness in the Venture…Seafield’s Miraflores Project in Colombia is coming along nicely but finding a way to put it into production is the challenge…by itself, Miraflores may not be enticing enough for a bigger player to step in which is why it’s important for Seafield to outline additional deposits in the area to complement Miraflores…John’s chart shows two critical support areas for SFF – 10 cents and 7 cents…given the current RSI(2) low extreme, the 10-cent area is likely to hold…SFF is up a penny to 11 cents in early trading…
Malartic Searched By Quebec’s Environment Ministry
In a sign that the new regime in Quebec may not be so mining friendly, Osisko Mining (OSK, TSX) reported late yesterday that representatives from Quebec’s environment ministry searched its Canadian Malartic mine yesterday morning…Osisko stated in a news release that the ministry collected documents related to “drilling, loading and blasting activities for certain dates between April 2011 and October 2012″…mining operations were reported as continuing as normal and the company said it was cooperating fully with the authorities and with the ongoing investigation…“The corporation believes that its operations are in compliance with laws and regulations, particularly with regard to environmental protection,” Osisko stated…the Quebec Sustainable Development, Environment, Wildlife and Parks Ministry in October asked the company to increase safety measures at the mine when it performed unplanned blasting…
Meanwhile, the Parti Québécois government has suffered a major setback with the resignation this morning of Environment Minister Daniel Breton…Breton’s unruly past came back to haunt him with front page news reports of unpaid rent, convictions for unemployment insurance fraud and a suspended driver’s licence…what a mess Quebec is in…
Note: Terry holds a share position in SFF.
Rainbow will be providing a major exploration update regarding its Nevada and Big
Strike Projects early during the week of December 3. This is as per the latest corporate fact sheet, dated today.
Comment by Alexandre — November 29, 2012 @ 8:14 am
another publicly stated deadline missed. time to quit talking the talk and start walking the walk…
Comment by db — November 29, 2012 @ 8:37 am
GQC… still waiting, my buy lot is set at 47 cents….
Comment by Theodore — November 29, 2012 @ 9:15 am
Why do they need to to an update just to realease assays? Put out the assays and then to an update if they feel the need to. They seem to think missing deadlines is OK. Good, Bad or indifferent news, I am out of RBW first chance I get.
Comment by Paul — November 29, 2012 @ 10:13 am
International assays obviously will never be released
Comment by Heath stockford — November 29, 2012 @ 10:52 am
Next week RBw will update their face sheet and big update the week if dec 10
Comment by Heath stockford — November 29, 2012 @ 11:27 am
I’ve been seeing a lot of discussion about the tax loss selling season that is going to be upon us. I think that given the poor market performance in this sector and that people generally play this sector as opposed to being equally diversified in all areas of the market… How much tax selling will there really be, since you need gains to necessitate the need to sell your losers. I certainly don’t have to worry too much about selling losers because that’s all I have, no problems with showing profit here.
Comment by Mike — November 29, 2012 @ 1:08 pm
Jon- Can you offer any opinion on the news release out of RIC?
Comment by Mike — November 29, 2012 @ 1:19 pm
BMR looks like RBW has announced that that major exploration update will be released sometime next week under their corporate facts sheet on their website.
What’s interesting is that they are now solely focused on their Jewel Ridge project in Nevada. It’s become more evident that Big Strike will not be bringing any blockbuster results. One can read between the lines and deduce this.
Let’s hope any disappointment there will be more than offset by a breakthrough in Nevada.
God help us if the announcement is to advance both projects further to “learn and understand” the geology of the land packages.
Until next week.
Comment by alex — November 29, 2012 @ 1:25 pm
seems like some really big news – Francoeur closed and Wasamac stopping exploration….
thoughs are appreciated!
Comment by Marc — November 29, 2012 @ 1:32 pm
I would say this is actually good news. Richmont has been having problems getting Francoeur ramped up for the past 2 years. Tough decision to make in some respects but you have to give Paul Carmel credit for acting in a bold manner. With regard to Wasamac, the project economics don’t add up at this point but might be much more favorable down the road in a higher gold price environment or in the event of additional discoveries. There’s a nice resource there but it simply won’t be profitable enough to mine at this point. Richmont is having success with its Island Gold Mine in Ontario, and Beaufor near Val d’Or is holding its own. Carmel has brought a major change of thinking to Richmont and I believe the street is going to like it. I definitely see Richmont securing another producing project somewhere (perhaps not Quebec) and they have the cash to do it. It’s been a bumpy ride for this company over the last 10 months but they will survive and ultimately thrive IMHO.
Comment by Jon - BMR — November 29, 2012 @ 1:35 pm
Thanks Jon for your quick response and thoughts!
I’ve been a holder of RIC from $3 a few years ago all the way up to over $10 and wayyyyy back down to $3 again… bumpy ride is right for sure!
i still have faith, way undervalued IMO.
Marc
Comment by Marc — November 29, 2012 @ 1:37 pm
They’ll be fine, Marc. Carmel made a good call today, which puts a couple problems behind them going into 2013.
Comment by Jon - BMR — November 29, 2012 @ 1:40 pm
Jon
what is your honest opinion of how long it is taking for RBW to release the International assays? And also these silly presentations that they have been doing which really tell us shareholders nothing of importance in my opinion.
thanks
Comment by GREG — November 29, 2012 @ 5:42 pm
Looks like the news on the International and other developments (Jewel Ridge, Gold Viking) is coming Monday or Tuesday. Let’s hope for good news on at least one of those fronts as I’ve mentioned earlier – I’m confident. No doubt they’ve been bogged down with 3 drill programs but if something spectacular had been hit at the International, you’d think that would be out by now. In terms of the presentations, I’ve only heard/seen one of them but it’s definitely not silly. I wish more companies would do that. Us shareholders should never complain when a company is working hard to tell its story in a professional manner. All it takes is for one person listening to gain a better understanding and like what he hears, and you could have a huge buy order.
Comment by Jon - BMR — November 29, 2012 @ 6:09 pm
Marc, what the heck are you expecting from an investment? You bought at $3, watched it go to $10, now its back to $3. From my standpoint, you have no one to blame but yourself. Learn to take a profit cause it might be awhile before you realize that potential gain that you lost. Pure greed
Comment by OldMan — November 29, 2012 @ 6:39 pm
I wonder if RIC will plummet tomorrow?
Comment by Alexandre — November 29, 2012 @ 6:54 pm
If it does, I’m going to pick up some. The street will like what Paul Carmel is doing. He’s boldly taking an axe to an operation (Francoeur) that has been giving Richmont problems for the past couple of years. Over 100 people lose their jobs, but this is business. Putting Wasamac on hold also makes sense if the economics at this point aren’t robust enough. This frees up Richmont to pursue a better opportunity, and Carmel has been around long enough – I’m sure he has his eyes set on something already. So I see this as the beginning of better times for Richmont after 10 months of going in reverse. They are also getting very good results out of the Island Gold Mine in Ontario, so there’s reason for a lot of optimism here. Carmel is changing the culture of Richmont which has been a family run operation since the beginning. Those who sell tomorrow on what they perceive to be “bad news” have got it entirely wrong.
Comment by Jon - BMR — November 29, 2012 @ 7:12 pm
Let me go out on a limb about RBW. One can argue that the news next week will be good. Considering that RBW is in the early prospecting stages, they have historical data to assist them in locating rocks that the market will like. The management is not shy of very hard work. Drilling three sites simultaneously, Mr. Decker on the team, and obviously a management that is quick on its feet with good networking abilities, they must be working everyday of the week. As for the financing, I let the sport team owner do the convincing. And finally, their concern about investors has been demonstrated with plenty of corporate facts and NR. The fact that they are late with the latest expectations is of minimal concern as the management is truly busy. Finally, if they have IR strategic savvy, RBW management might opt to produce an NR that will truly have an impact on the SP, hence easier future financing. Let us wait and see and hope it is not a Visible Gold disaster.
Comment by Alexandre — November 29, 2012 @ 8:04 pm
QRM – Quest Rare Minerals has been mentioned in Forbes. It trades at a multi years low. It appears that they have a major discovery at Strange Lake in Quebec. It might deserve a chart and a look.
Comment by Alexandre — November 29, 2012 @ 8:17 pm
ric is down 32% on the US AMEX after-hours. Let’s just say it is going to plummet tomorrow morning – somewhere between 25%-40%.
Ouch
I’ll buy this at $2 if it ever tests that.
Comment by alex — November 29, 2012 @ 8:19 pm
oldman, i should have clarified… not that i really need to explain to an oldman but whatever – i’ve bought and sold RIC at least 30 times over 2 years from $3 to $14 and back down to $3… my average price right now is $5 bucks so I’m underwater. however, overall i am up 600%!
Comment by Marc — November 29, 2012 @ 9:07 pm
jon, do you think GBB is up for grabs by RIC – they’re practically neighbours and GBB needs a mill!!
Comment by Marc — November 29, 2012 @ 9:08 pm
disclosure – my 2 biggest holdings currently are gbb and ric
Comment by Marc — November 29, 2012 @ 9:10 pm
Yes you guys really do your research (on the internet, (the misinformation highway.)the same place I gather my
lack of information), (everyone feeds on everyone else…information feedback))
Also bought RIC on your recommendation….also glad I bought a padded toilet seat. Also happy that you agree with
today’s decision..and your intimate knowledge of the progress the company has been making.
Also really keen on learning that I am reading the wrong, well……information feedback!!
Blogs are fun, purposeful,and provide the authors with an integral sense of providing a necessary service,
This brings to mind…’THE ROAD TO HELL WAS PAVED WITH GOOD INTENTION’
Comment by Paul — November 29, 2012 @ 9:40 pm
holy crap!!! Sidon just came back alive as Cameo (CRU) FINALLY!!!!
looks like Kamal Alawas died though…
legacy.com/obituaries/heraldnet/obituary.aspx?n=kamal-ebriham-alawas&pid=161206796#fbLoggedOut
Sidon International Resources Corporation
TERMS AND CONDITIONS:
As a result of a consolidation and name change, effective on November 27, 2012, holders will receive (1) one common share of Cameo Resources Corporation (CRU.H (TSXV)) (133240101) for every (30) thirty common shares of Sidon International Resources Corporation held. The status of fractional shares has yet to be determined.
FOR US RESIDENTS :
You now have the option of making a specific tax lot selection for your covered securities being sold. If we have not received your instruction prior to the effective date of the corporate action, the default accounting method used to calculate the cost basis for your security transactions will be First-In, First-Out (FIFO) as per the IRS.
As this Corporate Action may impact your investment portfolio, we would suggest you carefully read this notice. You may wish to consult your tax advisor as there may be tax consequences regarding this security. Should you require clarification of the terms or conditions, please contact your account representative by telephone. Please note that the information contained in this notice is compiled from sources believed to be reliable, but not guaranteed.
Comment by Marc — November 29, 2012 @ 9:49 pm
My wallet says Ouch!
Comment by Alexandre — November 29, 2012 @ 11:50 pm
Interesting to note that RBW live presentation will be exceptionally at 7pm, eastern time on Monday. If there is an NR on Monday, and the market reacts negatively, let us at least hope that the special guest will have a very thick skin.
Comment by Alexandre — November 30, 2012 @ 4:46 am