Gold has traded between $1,252 and $1,262 so far today…as of 11:30 am Pacific, the yellow metal is up $12 an ounce at $1,255…Silver has added 33 cents to $18.07…Copper is flat at $2.61…Nickel is down slightly at $4.44…Crude Oil has slid 41 cents to $47.56 while the U.S. Dollar Index is off one-third of a point at 99.14…
Markets are reacting to Friday’s political developments when House Republican leaders, just prior to a scheduled vote, decided to abandon their bill on a healthcare plan amid a lack of support, leaving investors fretting about the likely success of other Trump administration efforts including major tax changes and infrastructure spending…
Many investors who dumped equities this morning may have taken the wrong cue from Trump’s healthcare legislative defeat by linking it with his chances of successfully pursuing a broader economic agenda. “We think linking this particularly difficult legislative undertaking with the rest of the Trump (agenda) is flawed,” stated Tom Porcelli, chief U.S. economist at RBC Capital Markets. “It actually presents a scenario where tax reform can potentially be accelerated.”
Small business optimism in the U.S. has broken out to its highest levels since 2004…on the graph below, note the surge in business/investor optimism following the Trump victory in November…while there is disappointment in many quarters that Republicans failed in their first attempt to repeal and replace a flawed healthcare program, this should not significantly erode the much stronger sense of optimism that now prevails among small businesses and investors thanks to the prospects for tax reform and an untangling of regulations that have restrained U.S. economic growth in recent years…it would also be a mistake to underestimate Trump’s ability to adapt and bounce back from the “political defeat” being exaggerated by many pundits in the mainstream media…
No matter which way things turn with the Trump Presidency – admittedly, there are a variety of possibilities – it’s our view that one has to be bullish with regard to the prospects for Gold short-term and longer term…John’s updated 2-year chart in today’s Morning Musings certainly supports the case for the yellow metal heading north of $1,300 this year, perhaps as early as Q2…
Silver Short-Term Chart
Silver backed off abruptly from its late February high around $18.50, not surprising as that was just below resistance pointed out by John on the short-term chart following an almost non-stop run from a low of $15.70 in late December…the metal needed to take a breather and it did, retracing 60% of its gains…
Note the inverted head-and-shoulders bottom late last year/early this year – very positive sign entering 2017!…
We indicated previously that where Silver needed to hold price support was somewhere between $17.25 and $16.50, and indeed that is what occurred…RSI(14) also bounced off traditional support at 30% and is currently gaining momentum above 50%…
Silver has also now pushed above its rising 50-day SMA ($17.45) and is nudging up against its 200-day at $18.07…
All of this has occurred during a period of weak sell pressure (CMF) on the short-term daily chart…
Outlook remains bullish with the ADX indicator suggesting the trend has ample room to strengthen…we should see Silver top last year’s high of $21.23 during Q2 or Q3…the long-term chart, included in today’s Morning Musings, actually shows that something quite profound is in store for the metal over the next couple of years…
Many Silver juniors, however, continue to trade at very favorable valuations…
In Today’s Morning Musings…
1. Bonterra Resources (BTR, TSX-V) raises $20 million this month as Gladiator and area gain momentum…
2. Cannabix jumps on preliminary live testing results of marijuana breathalyzer…
3. The inevitability of $1,300+ for Gold…
4. Daniel’s Den – a company with a quality land package the size of 78 countries!…
Click here to receive, via email, BMR’s “Who’s Who” List of the Greater Cobalt Camp – the top dozen or so companies active in the district.
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Jon, are you aware that BAYHORSE SILVER “BHS” is now a producing silver mine?
The shares trading at .18 are an excellent buy IMO.
I understand that Management owns some 65% of the shares.
David Morgan has interviewed the CEO three times and he will soon make a site visit to the mine.
Your thoughts Sir Jon?
Comment by jeff — March 27, 2017 @ 1:31 pm
Majors are sure getting hungry for quality deposits. Exeter being taken over by Goldcorp at a 67% premium to yesterday’s close. On the same belt in Chile, to the north and just south of a Silver mine owned by Kinross, is Atacama Pacific’s Cerro Maricunga oxide Gold Project we highlighted in a presentation yesterday.
Mr. David Garofalo of Goldcorp reports
GOLDCORP TO ACQUIRE EXETER RESOURCE CORPORATION
Goldcorp Inc. and Exeter Resource Corp. have entered into a definitive arrangement agreement, pursuant to which Goldcorp has agreed to acquire, by way of a plan of arrangement, all of the issued and outstanding shares of Exeter. The total consideration offered for all of the outstanding shares of Exeter is approximately $247 million (on a fully diluted basis).
Under the Arrangement, each common share of Exeter will be exchanged for 0.12 of a common share of Goldcorp. Based on the closing price of Goldcorp’s common shares on the Toronto Stock Exchange on March 27, 2017, the Arrangement values each Exeter share at $2.58. The consideration received by Exeter shareholders represents a premium of 67% based on Goldcorp’s and Exeter’s closing prices on the Toronto Stock Exchange on March 27, 2017 and a premium of 60% based on Goldcorp’s and Exeter’s 20-day volume-weighted average share prices on the Toronto Stock Exchange for the period ending March 27, 2017. The number of Goldcorp shares to be issued under the Arrangement will be approximately 10.6 million based on the issued and outstanding shares of Exeter as of the announcement date, but will be subject to adjustment depending on the number of Exeter options that may be exercised prior to the completion of the Arrangement. As part of the Arrangement, all Exeter stock options that are outstanding will be exercisable for Goldcorp shares based on the share exchange ratio for the remainder of their original term.
Exeter’s primary asset is the 100%-owned Caspiche project (“Caspiche”) located in the Maricunga mineral belt in Chile, approximately 10 kilometers to the north of the Cerro Casale project. Caspiche is a gold-copper porphyry system with an oxide gold zone on surface and a high-grade gold-copper core, which has the potential to be developed as a high tonnage, long life mining operation. Caspiche has the following mineral resources1:
Tonnes (M) Au (g/t) Contained Au (Moz) Cu (%) Contained Cu (Blb) Ag (g/t) Contained Ag (Moz)
Measured and Indicated 1,403.6 0.51 23.0 0.19 5.9 1.20 54.2
Inferred 198.1 0.29 1.8 0.12 0.5 0.91 5.8
“The Caspiche project is located in the heart of Chile’s northern mining district,” said David Garofalo, President and Chief Executive Officer. “With the acquisition of Caspiche and 50% of Cerro Casale, we envisage the two deposits being jointly advanced with Barrick, similar to our existing arrangement with Teck Resources at NuevaUnion. This joint venture structure with Barrick has the potential to allow us to consolidate infrastructure to reduce costs, reduce the environmental footprint and provide increased returns compared to two standalone projects. With our combined technical and financial strength, we see significant potential to increase net asset value per share and deliver value for all partners and stakeholders.”
The Arrangement has been unanimously approved by the boards of directors of Goldcorp and Exeter and will be subject to, among other things, the favourable vote of 66 2/3% of the holders of Exeter shares at a special meeting of Exeter shareholders to be held no later than May 31, 2017, receipt of all necessary regulatory and court approvals and the satisfaction of certain other closing conditions customary for a transaction of this nature. The Exeter and Cerro Casale transactions are not conditional on the completion of the other.
The Arrangement Agreement includes customary deal protection provisions. Exeter has agreed not to solicit any alternative transactions and, in certain circumstances, to pay Goldcorp a termination fee equal to $8.65 million in the event that the Arrangement is not completed. Exeter has also provided Goldcorp with certain other customary rights, including a right to match competing offers. Closing of the transaction is expected to occur no later than June 30, 2017.
All of the directors and officers of Exeter, representing approximately 8.4% of Exeter’s outstanding shares have entered into voting support arrangements with Goldcorp under which they have agreed to vote in favour of the Arrangement. Scotiabank and Paradigm Capital Inc., have provided opinions to the Exeter Board of Directors and the special committee of independent directors of Exeter, respectively, that as of the date of such opinions and subject to the assumptions, limitations, and qualifications stated in such opinions, the consideration to be received by the Exeter shareholders under the transaction is fair, from a financial point of view, to the Exeter shareholders (other than Goldcorp and its affiliates).
Comment by Jon - BMR — March 28, 2017 @ 5:10 am
CPO finally waking up Jon? looks clean too! You were right on Gold/Silver moving ‘up’ after the rate announcement! 🙂
Comment by STEVEN1 — March 28, 2017 @ 5:38 am
I love rate hikes, Steven1. Yes, CPO could be about to gain some traction as well. April could be another big month for the Cobalt plays after most went thru some consolidation in March.
Comment by Jon - BMR — March 28, 2017 @ 5:46 am
CPO – looks ready to move. IP survey results out soon and i believe it will show they have something exciting to drill 🙂 Combined with the team running the show, expecting nice increase in share price.
Comment by Foz1971 — March 28, 2017 @ 6:44 am
EGM HALTED
Comment by Silverhook — March 28, 2017 @ 8:01 am
Mr. David Brett reports
ENGOLD INTERSECTS 24 METRES AND 13 METRES OF INTENSELY MINERALIZED MATERIAL IN LATEST TWO DRILL HOLES AT NEW DISCOVERY ZONE
Two drills exploring a new copper/silver/gold discovery at Engold Mines Ltd.’s 100-per-cent-owned Lac La Hache property have both intersected broad intervals of intensely mineralized material that is visually similar to discovery hole G16-01. Holes G17-03, collared 50 metres east of discovery hole G16-01, and G17-04, collared 50 metres west of G16-01, intersected 24 metres and 13 metres, respectively, at the same stratigraphic levels at approximately 335 metres downhole. The holes are vertical and intercepts are believed to be true width. The mineralized core will be logged and assayed on a rush basis. Both drill holes will continue to their target depth of approximately 450 metres.
“The new drill information confirms the stratabound nature and size potential of the skarn-style mineralization we observed in the discovery hole,” said vice-president of exploration Rob Shives, PGeo. “The newly commissioned gravity survey is proceeding, and the data from this work will provide additional guidance for our drill program.”
“These strong stepout holes at the new discovery area are very encouraging,” said Engold president and chief executive officer David H. Brett. “Our exploration team is growing and continues to do excellent work, covering not one but two high-priority targets at the Lac La Hache property where assay results from the Aurizon gold zone are also pending.”
Following the completion of holes G17-03 and G17-04, Engold plans a brief pause in the drill campaign to allow time for assay results to come in, avoid difficult spring breakup conditions, enable new geophysical data to be processed and analyzed, and provide time to plan and staff up for what management expects an intensely busy rest of 2017. Drilling is expected to resume April 19 following the Easter weekend.
About Engold Mines Ltd.
Engold is focused on finding and developing mining operations at its 100-per-cent-owned mineral property located near the town of Lac La Hache in British Columbia’s prolific Cariboo mining region. Engold’s corporate philosophy rests on three interdependent pillars: environment, engagement and gold. Through sound environmental stewardship, commitment to transparent engagement with local communities, the company is dedicated to driving exceptional shareholder and stakeholder value by discovering and developing mineral resources.
About the Lac La Hache property
The advanced-stage property lies within B.C.’s Quesnel trough mineral belt, which hosts several past and currently producing copper/gold/silver mines, including nearby Imperial Metals Corp.’s Mount Polley copper-gold mine and New Gold Inc.’s New Afton copper-gold mine. The company has drilled numerous prospects on the property, including the Spout copper-magnetite-gold-silver deposit (for which a resource calculation has been reported and supported by a National Instrument 43-101 technical report), the gold-rich Aurizon gold-copper-silver prospect and recent new discoveries with porphyry and skarn copper/gold potential. Supported by significant local infrastructure, including power lines, all-season road access, rail and other amenities, the Lac La Hache project demonstrates excellent logistics for resource extraction.
Mr. Shives, a qualified person as defined under National Instrument 43-101, has reviewed and approved the technical content of this release.
We seek Safe Harbor.
Comment by Jon - BMR — March 28, 2017 @ 8:34 am