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 ‘That’s a Wrap’

By Rod Blake

Most investors, traders and portfolio managers were feeling pretty pumped up going into the new North American trading week as the markets seemed to have weathered the banking crisis were continuing to grind higher as most pundits were confirming that inflation had peaked, and interest rates would soon be reversing their recent upward trend. What could go wrong?

The way I see it – The markets seem to be saying that the central banks have achieved their goal of turning inflation lower without any real damage to the economy – the so called Soft Landing. This may be so and recent data would seem to confirm that position. Therefore there’s no reason why the markets cannot continue to march towards their highs of last year. But should the economy stumble and the Recession word raises its ugly head then I would expect the markets to quickly turn down to test their October lows. This is a normal occurrence as markets often test their recent lows before moving substantially higher.

And then as if on cue – the price of West Texas Intermediate (WTI) crude oil surged up by $4.76 or 6.29% to US$80.43 after OPEC announced the cartel would be cutting crude oil production by 1.2-million barrels per day, while Russia confirmed its recent 500,000 barrel per day production cut would continue until the end of the year.

First Quantum Minerals Ltd. ‘FM-T shares rose by $1.22 or 3.93% to $32.29 after the Toronto. ON based miner announced the company had entered into an agreement with Rio Tinto Plc ‘RIO-N’ that will see First Quantum purchase a 55% interest and become operator of the La Granja copper project northeast of Chiclayo, Peru for a cash consideration of some US$105-million.

And the price of Canada’s largest mining giant Teck Resources Ltd. ‘TECK.B-T & ‘TECK-N’ stock surged up by $9.24 or 8.72% to $58.59 after the Vancouver, BC based company received and rejected a $23-billion all-stock takeover bid from fellow Swiss based mining giant Glencore Plc ‘GLEN-L’ representing a 20% premium to Teck’s March 26th closing stock price.

Vancouver, BC based Skeena Resources Ltd. ‘SKE-T  & N’ shares’ fell by $0.44 or 5.03% to $8.30 on word that London, England based Hochschild Mining PLC ‘HOC-L’ was dropping its option to earn a 60% in Skeena’s Snip Gold Project in northwest British Columbia.

Meanwhile, The Gitxaała First Nation of northwest British Columbia has filed a Supreme Court petition challenging the province’s right to grant mineral claims without the Nation’s consent.

Electric vehicle (EV) leader Tesla Inc. ‘TSLA-N’ recently released Master Plan for the World to Transition to Clean Energy calls for an investment of some US$3.4-trillion for mining, refining, chemicals, battery production and gigafactories of which US$1.2-trillion will be needed for mining and refining alone.

This as the price of lithium fell to a new 21/4-year low of US$31,597 per tonne.

Lundin Gold Inc. ‘LUG-T’ stock rose by $0.60 or 3.66% to $17.00 after the Vancouver, BC based miner reported record quarterly gold production of over 140,000 ounces at the company’s Fruta del Norte gold mine in southeast Ecuador.

This as the price of gold bullion rose by $38 to a new 1-year high of US$2022 per troy ounce.

And the price of silver gained $2.01 to a new 11-month high of US$24.98 per troy ounce.

The key Baker Hughes Petroleum Rig Count reported the number of active American drilling rigs fell by 4-rigs over the past week to 751, up by 62 from this time last year. Across the line – the number of Canadian active rigs dropped by 12-rigs to 127, an increase of 16 in the past year.

The markets were closed Friday and traded positively on Thursday going into the Easter Long Weekend.

For the Week – the DJI gained 0.63% to 33,485 while the S&P 500 lost 0.10% to 4,105 and the NASDAQ fell by 1.10% to 12,088. Up north – the TSX gained 0.48% to 20,197 while the TSX Venture lost 1.26% to 626. The CBOE Volatility Index or VIX fell by 1.60% to 18.40.

With currencies – the Canadian dollar gained 0.20% to US$0.7413 and the U.S. dollar ‘DXY’ fell by 0.56% to 101.94.

With commodities gold bullion rose by 1.98% to US$2,008, as silver gained 3.15% to US$24.85, while copper fell by 1.42% to US$4.03, and lithium lost 8.16% to  US$31,597. Crude oil gained 6.32% to US$80.45 as natural gas lost 6.45% to US$2.03, and uranium was unchanged at US$50.35. With soft commodities – lumber rose by 3.77% to US$385. Overall – the CRB Commodities Index improved by 1.70% to 299.

And Finally – It seems that Canadians are moving more and more towards digital currency transactions as the Royal Canadian Mint (which stopped issuing the penny in 2013) recently reported that the demand for Canadian coinage continues to drop by about 8% a year.

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