Happy Thanksgiving to our American readers…U.S. equity markets are closed today and will be open tomorrow for just half the day…
Gold is trading in a narrow range so far today on this American holiday…as of 7:15 am Pacific, bullion is up $2 an ounce at $1,731…Silver is up 2 pennies at $33.41…Copper has gained 3 pennies to $3.50 on encouraging economic data out of China…Crude Oil is flat at $87.37 while the U.S. Dollar Index, which encountered strong resistance as expected around 81.50, is off one-tenth of a point at 80.66…
Chinese Economy Rebounding
China’s manufacturing sector expanded for the first time in 13 months in November…China’s HSBC Flash Purchasing Managers Index (PMI) rose to 50.4 in November, the latest indicator of recovery in the real economy after data showing solid credit growth, firmer exports and rising industrial output in the previous month…the stronger than expected PMI reading signals that the risk of a hard landing in China has lowered considerably…some analysts are quite bullish…“We’re out of the woods here, it’s going to be a V (shaped recovery),” stated Frederic Neumann, co-head of Asian economies at HSBC, in an interview with CNBC…”The new policymakers coming in certainly do not have an interest to see the economy tank next year,” he added…improvement in the manufacturing sector was supported by an increase in new export orders, while employment in the sector contracted at a slower rate…“It (PMI data) shows policy easing continued to support growth recovery, and reinforces our view that growth will pick up strongly in the fourth quarter,” said Zhiwei Zhang, chief China economist at Nomura…the Chinese government has stepped up policy efforts in recent months, through launching a $150 billion infrastructure stimulus package and providing tax breaks and subsidies to small firms…Nomura is forecasting that growth will pick up to 8.4% in the last quarter of the year from 7.4% in the previous three months…
Today’s Markets
Asian markets were mostly strongly higher overnight, though China’s Shanghai Composite strangely bucked the trend by sliding 15 points despite a reversal in the PMI…markets are modestly higher in late trading across Europe…PMI data for both Germany and France showed minor improvement…meanwhile, Spain sold nearly 4 billion euros of bonds with ease at an auction today that kicked off its funding program for a daunting 2013 when Madrid must shoulder regional debt needs and will struggle to meet deficit targets…the average yield on the 2021 bond was 5.5%, compared with around 5.6% for the benchmark 10-year on the secondary market, a long way from the 7+% levels in July…Madrid faces some 28 billion euros in debt redemptions in January while in 2013 the country’s funding needs rise to 207 billion euros from 186 billion euros this year, assuming the country doesn’t overshoot its deficit targets…
As of 7:15 am Pacific, the TSX is up 70 points at 12170 while the Venture Exchange is up 2 points at 1245…
Fission Energy (FIS, TSX-V) Updated Chart
Two hot uranium plays recently have been Fission Energy (FIS, TSX-V) and joint-venture partner Alpha Minerals (AMW, TSX-V) who have made a discovery at their Patterson Lake South (PLS) Project in Saskatchewan’s Athabasca Basin…below is an update to John’s recent chart on Fission which has not yet broken out despite its climb to an intra-day high of 66 cents yesterday…it closed at 60 cents, exactly at the long-term down trendline that it needs to overcome…this is a familiar chart pattern – some stocks have already broken out of their down trendlines going back to 2011, others like Fission are right on the edge (the Venture itself is close but hasn’t yet broken out)…as of 7:15 am Pacific, FIS is unchanged at 60 cents…
Rainbow Resources (RBW, TSX-V) Chart Update
Buying pressure has been on the increase again with Rainbow Resources (RBW, TSX-V) which has reversed from last week’s lows when the stock traded down to strong support…RSI is showing up momentum…there are a few potential near-term “triggers” that could power Rainbow to John’s Fibonacci levels in a hurry, specifically results from three different properties – the International, Gold Viking and Jewel Ridge…RBW is up a penny at 20 cents in early trading, and the 10-day moving average (SMA) has swung positive…
Argex Titanium (RGX, TSX-V)
Below is a chart update on Argex Titanium (RGX, TSX-V) which we have been following occasionally through most of this year…it is now trading at an all-time high after closing 13 cents higher yesterday at $1.32 on strong volume (all exchanges) of nearly 1.4 million shares…RGX is up 4 pennies at $1.36 through the first 45 minutes of trading…
Note: John and Jon both hold share positions in RBW. John, Jon and Terry do not hold share positions in FIS or RGX.
