A Weekly Recap of All Things Resources to Friday, January 27th
‘That’s a Wrap’
By Rod Blake
Just like Jay Trotter (That’s a Wrap – January 20th) – junior recourse investors were walking a little taller when the new trading week began as the TSX Venture Exchange – the best barometer of resource issues – had managed to string together three consecutive weekly gains and was up – albeit from a very oversold level – over 12% so far this year.
The way I see it – At 624 the TSX Venture Exchange began the week well above its lows of 555 in December and was nicely above short-term resistance of 600. The next resistance level is in the 675 range which was the peak of a failed rally last August. So far trading volumes have been light with last Friday’s volume of just over 22-million shares. This will have to increase with new buying in order to overcome the increased selling that will appear as the exchange tries to rise and hopefully break through to higher levels.
The TSX rose to a new 7-month high of 20,714.
The DXY fell to a new 7-momth low of 101.61.
Kodiak Copper Corp. ‘KDK-V’ shares’ fell by $0.20 or 16.95% to $0.98 after the Vancouver based mineral explorer released further copper/gold/silver drill hole assays from the company’s flagship MPD project north of Princeton, BC.
While Calibre Mining Corp. ‘CXB-T’ stock gained $0.05 or 4.55% to $1.15 after the Vancouver, BC based mineral developer reported impressive drill hole gold assays from the company’s Golden Eagle Project in Ferry County, Washington that included 4.30 g/t Au over 92.42-metres.
And Fortuna Silver Mines Inc. ‘FVI-T’ shares’ fell by 0.31 or 5.57% to $5.26 after it was revealed that a previous ore grade survey error has led to a 201,000 ounce or 43.3% drop in minable gold at the company’s prized Yaramoko Mine in Burkina Faso.
This as the price of gold bullion rose to a new 9-month high of US$1,945-per-ounce.
And copper rose to a new 7-month high of US$4.27-a-pound.
Imperial Oil Ltd. ‘IMO-T & NA’ announced the Calgary, AB based Canadian petroleum giant will spend $720 million to construct Canada’s largest renewable diesel facility at the company’s Strathcona refinery near Edmonton that will produce over 1-billion litres of renewable diesel fuel per year while reducing transportation-based greenhouse gas emissions by about 3-million metric tonnes per year.
Meanwhile energy behemoth Chevron Corporation ‘CVX-N’ announced a 6% quarterly dividend increase to US$1.51 per share to go along with a staggering US$75-billion stock buyback program.
This as the price of natural gas fell to a new 11/2-year low of US$2.85/mbtus.
The influential Baker Hughes Petroleum Rig Count reported the number of active American drilling rigs was unchanged in the past week to 771, up by 161 from this time last year. Across the line – the number of Canadian active rigs rose by 6-rigs to 247, an increase of 30 in the past year.
The price of Uranium Energy Corp. ‘UEC-NA’ rose by $0.12 or 3.20% to US$3.87 after the Corpus Christi, TX uranium company reported further drill hole uranium assays from the Sakura Zone of its Christie Lake Project in the Eastern Athabasca Basin in Northern Saskatchewan that included 23.2% eU3O8 over 3.4-metres.
Aecon Group Inc. ‘ARE-T’ partnered with GE Hitachi and SNC-Lavalin ‘SNC-T’ to enter into a 6-year alliance agreement with Ontario Power Generation to deliver North America’s first Small Modular Nuclear Reactor in Clarington, On.
Ontario Premier Doug Ford, speaking at the Rural Ontario Municipal Association annual general meeting regarding the provinces northern Ring of Fire wealth of critical minerals stated – “We should never ship our critical minerals over to other countries so they can produce batteries in their country, and ship them back to Ontario. It doesn’t work that way. You can have our critical minerals, as long as you’re manufacturing the batteries here. We’re going to build the cars of the future right here in Ontario.”
In a statement where bad news for employees is good news for investors – the price of Canfor Corporation ‘CFP-T’ stock rose by $2.08 or 8.95% to $25.32 after the Vancouver, BC based forest company announced the permanent closure of the company’s Chetwynd, BC sawmill and pellet plant as well as a temporary closure of its Houston, BC sawmill while the company finalizes plans to rebuild that aging facility.
Vancouver, BC based Western Forest Products Inc. ‘WEF-T’ announced the company will not be restarting its Alberni-Pacific Division facility in Port Alberni, BC that originally curtailed operations temporarily last fall.
For the Week – the DJI gained1.81% to 33,978 as the S&P 500 rose by 2.45% to 4,071 and the NASDAQ was ahead by 4.33% to 11,622. Across the line – the TSX rose by 1.03% to 20,714 while the TSX Venture lost 0.32% to 622. The CBOE Volatility Index or VIX was down by 6.75% to 18.51.
With currencies – the Canadian dollar improved 0.62% to US$0.7512 as the U.S. dollar ‘DXY’ fell by 0.07% to 101.94.
With commodities – gold bullion gained 0.78% to US$1,928 as silver lost 1.38% to US$23.59, and copper fell by 0.71% to US$4.22, while lithium rose by 0.43% to US$70,716. Crude oil fell by 2.85% to US$79.31 and natural gas fell by 8.63% to US$2.86 while uranium gained 2.97% to US$50.25. Meanwhile, lumber gained 14.85% to US$495. Overall – the CRB Commodities Index rose by 0.33% to 304.
And Finally – China’s National Bureau of Statistics recently issued a surprising report that the world’s most populated country, with a population of some 1.4-billion people, suffered a population drop of over 850,000 people in 2022 – 10-years ahead of previous predictions as when this event would happen. This drop in population puts China on the same birthrate plane as Europe and North America and could have serious ramifications on the country’s economic growth. China has the same aging population problems as does the western world, but unlike those areas, China does not have an immigration policy that brings in younger people and money to help fuel their economy. The period of China dramatically outperforming the rest of the world’s economies may be coming to an end.