A Weekly Recap of All Things Resources to Friday, May 26th
‘That’s a Wrap’
By Rod Blake
While Canadian investors took a much-appreciated Victoria Day long weekend and Monday off, their American counterparts opened their screens to what looked to be another choppy week of uncertainty due to the markets’ continued very narrow focus on will the U.S. debt ceiling be renewed and what will be the U.S. fed’s next move on interest rates.
The way I see it – As a broker I often compared the markets to fishing. (Not that I was a good fisherman.) For the most part fishing is a patience sport. One has to have their line in the water in order to catch a fish as one never knows when the fish will bite. But when they bite, and your line is in the water you get a chance to reap the rewards. Similarly, one has to be invested in order to take advantage of a bull market as investing is also a patience game. One has to have their portfolio ready to take of advantage of a bull market. It’s very difficult to time a market and invest just when the bull run begins. Chances are the early and best part of the run will be missed. As frustrating as it is – keep your lines in the water or keep invested. You never know when the fish will bite, or the new bull market will come.
Exxon Mobil Corp. ‘XOM-N’ joined a growing list of senior companies getting exposure to the lithium space as the world’s largest energy company announced the purchase of 120,000 gross acres of prospective lithium ground in southern Arkansas from Galvanic Energy for some US$100 million.
Similarly, Ford Motor Co. ‘F-N’ announce battery grade lithium supply agreements with three existing or prospective lithium producers Albemarle Corp. ‘ALB-N’, Compass Minerals ‘CMP-N’ and Nemaska Lithium.
Meanwhile – Ford also announced the company would begin to preload the company’s American electric vehicles (EVs) with adapters to allow their EVs access to Tesla’s 12,000 Supercharger stations across the United States.
As a young man working on drilling rigs I was always fascinated by what minerals mother nature held secret for eons and then gave back in assays such as Rupert Resources Ltd. ‘RUP-T’ reporting an impressive 3.1 grams per tonne gold (g/t Au) over 145.7-metres from an infill diamond drill hole at the flagship Rupert Lapland Project in Northern Finland.
Fortuna Silver Mines Inc. ‘FVI-T’ stock gained $0.07 or 1.59% to $4.48 after the Vancouver, BC based intermediate producer announced the first gold pour at the company’s Séguéla Mine in Côte d’Ivoire, West Africa.
This as the price of gold bullion fell to a new 2-month low of S$1,940 a troy ounce.
IMPACT Silver Corp. ‘IPT-V’ shares fell by $02 or 6.67% to $0.28 after the Vancouver, BC based operator of several small Mexican silver mines failed to impress the street with its 1st-quarter financials.
This as the price of silver dropped to a new 2-month low of US$22.72 a troy ounce.
Copper fell to a new 51/2-month low of US$3.56 a pound.
ConocoPhilips ‘COP-N’ announced the Houston, TX based American energy giant had exercised its rights to purchase TotalEnergies EP remaining 50% interest in the Surmont oilsands operation in northern Alberta in an all-cash deal of some US$3 billion.
The closely followed Baker Hughes Petroleum Rig Count reported the number of active American drilling rigs fell by 9-rigs over the past week to 711, down by 16 from this time last year. In Canada – the number of active rigs rose by 2, for loss of 16 in the past year.
The TSX Composite Index (TSX), TSX Venture Exchange (TSX-V) and the Dow Jones Industrial Index (DJII) all fell to new 2-month respective lows of 19,774, 603, and 32,765.
Meanwhile – artificial intelligence (IA) companies helped to propel the NASDAQ Composite Index to a new 9-month high of 12,976.
The markets were cautiously optimistic going into the American Memorial Day long weekend.
For the Week – the DJI lost 1.00% to 33,093 while the S&P 500 gained 0.14% to 4,205 and the NASDAQ was ahead by 2.51% to 12,976. Up north – the TSX lost 2.12% to 19,920 and the TSX Venture fell 1.47% to 604. The CBOE Volatility Index or VIX rose by 6.78% to 17.95.
With currencies – the Canadian dollar lost 0.86% to US$0.7345 and the U.S. dollar ‘DXY’ gained 0.98% to 104.21.Â
With commodities – gold bullion lost 1.57% to US$1,946, as silver fell by 2.22% to US$23.30, while copper dropped by 1.61% to US$3.66, and lithium fell by 0.68% to US$32,170. Crude oil gained 1.57% to US$72.67 while natural gas lost 6.56% to US$2.42, and uranium rose by 0.37% to US$53.60. With soft commodities – lumber improved by 41.57% to US$487. Overall – the CRB Commodities Index lost 0.69% to 288.
And Finally – While the Canadian federal government recently saw no issues in pressuring its Public Service Alliance of Canada employees to accept a $23,000 or12.6% pay increase over the next 4-years it also found no issue in awarding Governor General Mary May Simon a $48,800 or 16% pay increase in the past 4-years – including $9,800 in 2023 alone.