‘That’s a Wrap’
By Rod Blake
Following last week’s plus 5% gains on the four senior North American markets, most market pundits felt that barring another mega world event – the markets were poised for a significant year-end rally.
The way I see it – With October – traditionally one of the worst performing months – behind us, most brokers, investors, traders and portfolio managers were probably positioning their portfolios for the next two months and the New Year to come. Moreover, if the U.S. Fed and other central bankers have indeed halted their near 2-year run of higher interest rates, then the gains over the next few months could be substantial.
Last week’s market enthusiasm spilled over into the new trading week, although recourse issues seemed to lag the other sectors.
One notable resource exception however was Hercules Silver Corp. ‘BIG-V’. The Toronto, ON based junior explorer saw its stock price surge up by $0.22 or 33.66% to close at an all-time high of $1.15 after the company announced that mining industry giant Barrick Gold Corp. ‘ABX-T’ & ‘GOLD-N’ was investing a strategic $23,391,907 in Hercules to help advance the company’s flagship Hercules multi-mineral Project northwest of Cambridge, Idaho.
Crescent Point Energy ‘CPG-T & N’ greatly increased its Montney and Duvernay land positions and production profiles by announcing the acquisition of fellow Calgary, AB based petroleum producer Hammerhead Energy Inc. ‘HHRS-T & Q’ in a cash & stock deal valued at some $2.55-billion. CPG shares’ fell $1.08 or 9.87% to close at $9.86 on the announcement of the deal while HHRS stock rose by $0.52 or 2.60% to close at $20.52.
An Alaskan court upheld a previously Biden administration approved ConocoPhillips ‘COP-N’ US$7.5-billion, 600-million barrel Willow oil development on Alaska’s North Slope.
This as the price of natural gas fell to a new 2-month low of US$3.02 per million British thermal units (MMbtu) and crude oil fell to a new 31/2-month low of US$75.54 per barrel (Bbl).
This as the closely followed Baker Hughes Petroleum Rig Count reported the number of active American drilling rigs fell by 2-rigs over the past week to 616, down by 163 rigs from this time last year. Across the line – the number of active Canadian active rigs rose by 3-rigs to 199, down by 1-rig from a year ago.
Lumber rose to a new 21/2-month high of US$522 per 1,000 board feet (MBF).
TransAlta Corporation ‘TA-T’ & ‘TAC-N’ shares’ rose by $0.27 or 2.54% to $10.92 after the Calgary, AB based power company released better than expected 3rd-quarter financials.
Also with power generation, and with what could be a precursor of things to come – the Montreal, QC borough of Saint-Laurent is proposing to install solar panels on 4.5-million square metres of industrial rooftops within its region. That’s the equivalent of some 850 soccer fields of solar generated electricity – enough to heat 24,000 homes.
And further with power generation – Cameco Corp. ‘CCO-T’ & ‘CCJ-N’ shares’ gained $0.77 or 1.33% to $56.77 after the Saskatoon, SK based uranium giant announced it and partners had completed the acquisition of Westinghouse Electric Company (WEC).
Rivian Automotive Inc. ‘RIVN-Q’ reported the company’s 3rd-quarter delivery of electric vehicles (EVs) rose by 23.8% from Q2-2023 and by 136.4% over Q3-2022 to 15.6-thousand units.
This as the price of Lithium fell to a new 7-month low of US$20,735 a tonne.
All of which helped pull lithium industry giant Albemarle Corporation ‘ALB-N’ stock down to a new 3-year closing low of US$114.60.
Pan American Silver Corp. ‘PAAS-T & N’ stock dropped by $1.84 or 8.91% to close at $18.80 after the Vancouver, BC based miner’s 3rd-quarter financials fell short of investor expectations.
Similarly – the price of HudBay Minerals Inc. ‘HBM-T&N’ stock fell to a one year closing low of $5.81 after the Toronto, ON based gold/copper miner released its 3rd-quarter report.
Going the other way – Kinross Gold Corporation ‘K-T’ & ‘KGC-N’ shares’ rose by $0.23 or 3.18% to close at $7.47 as the market reacted favourably to the Toronto, ON senior gold miner’s 3rd-quarter report.
NexGen Energy Ltd. ‘NXE-T&N’ announced the Vancouver, BC based uranium developer had received the key approval under The Environmental Assessment Act of Saskatchewan to proceed with the company’s prized Rook 1 Uranium Project in the Athabasca Basin region of Northern Saskatchewan.
Also with uranium – the price if industry giant Cameco Corporation “CCO-T & ‘CCJ-N’ rose later in the week to a new 16-year closing high of $58.68 a share.
Meanwhile the junior focused TSX Venture Exchange fell to a new 31/2-year low of 507.
Lumber was the only commodity showing a gain going into the weekend, while crude oil and lithium were the biggest losers.
The tech heavy U.S. North American markets rallied going into the weekend while the resource weighted Canadian exchanges suffered along with most commodity prices.
For the Week – the DJI gained 0.65% to 34,283 with the S&P 500 up 1.31% to 4,415 and the NASDAQ ahead by 2.37% to 13,798. Up north – the TSX lost 0.86% to 19,654 and the TSX Venture fell 2.86% to 510. The CBOE Volatility Index or VIX fell 4.96% to 14.17.
With currencies – the Canadian dollar fell 0.96% to US$0.7245 while the U.S. dollar ‘DXY’ gained 0.67% to 105.79.
With commodities – gold bullion lost 2.71% to US$1,938, as silver lost 4.14% to US$22.24, while copper fell 1.91% to US$3.59, and lithium lost 3.27% to US$20,735. Crude oil lost 4.68% to US$77.17 while natural gas dropped 13.47% to US$3.02, and uranium fell 0.47% to US$73.65. With soft commodities – lumber gained 1.18% to US$514. Overall – the CRB Commodities Index lost 3.13% to 310.
And Finally – This year’s breakthroughs and increased interest in Artificial Intelligence (AI) has brought about enhanced fears of the robots making mistakes. These fears may have some foundation as South Korean news agency Yonhap recently reported that a robot in a distribution centre fatally crushed a worker as it tried to move him after mistaking the man for a box of vegetables.
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