"The history of Eureka lies in its future." - Lambert Molinelli, 1878

DISCLOSURE

The author/editor of the Eureka Miner owns common shares of local mining stocks, General Moly (GMO), McEwen Ming (MUX) and Newmont Mining (NEM); together with benchmark miner Freeport-McMoRan (FCX). Please do your own research, markets can turn on you faster than a feral cat.

Thursday, April 23, 2009

Reading the Global Tea Leaves for Eureka

Morning Miners:

It is 6:02am, a little earlier than usual but I need to take my truck in for a checkup and then drop by to give Connie and Christine a hey-howdy at the Eureka Supply. While we're waiting for the coffee to brew, I thought it might be useful to look at some of the ground we've covered over the last few weeks. Markets discount bad news and are for the most part, forward looking. Since mining is a large part of our local economy, we've been looking at commodity, equity and currency markets to try and figure out what's on the horizon for Eureka County. If this search has got you scratching your head with a lot of conflicting information, you've got some company:

"The market's becoming very polarized," said BBY senior trader Peter Copeland in Australia. "There are entrenched bears that think this (rally) is all just smoke and mirrors, and there are bulls who think the bears are wedded to their view in the face of recovery signs." (WSJ, 4/22/09)

The ole Colonel listens to Aussies because they are sitting an a huge hunk of natural resources like ourselves and our neighbors to the north. What happens to the global economy affects them, Eurekans and Canadians in much the same way. Commodity-sensitive economies rely on a healthy and growing global demand and lately it has been a pretty sick puppy. I plan to help you put all this together with upcoming reports.

If you look at the right column of this blog, there is a "Blog Archive" that covers many of the key market events for the months of March and April. You can access present and historical price data for molybdenum, gold and copper by clicking on the InfoMine chart icons in the same column. The "Miner's Corner" provides links to the homepage for the miners in Eureka county and surrounding areas. For new visitors to this site, "Discover Eureka" has links to the county homepage, the historical Opera House with an events calendar and local business and property interests. There is also a link to the National Weather Service for our area complete with satellite imagery.

The ole Colonel will soon report on the first quarter conference calls for the big mines in our area:

Barrick (ABX) 4/29 before market open
Newmont (NEM) 4/30 10:00am (ET)
General Moly (GMO) not scheduled

Everyday there is a summary of relevant market data. Today it will be a midday report.

Enough talk, let's walk the walk:

Oil is up a bit at $49.41 (June contract). If oil prices get above $50.50 look for them to go higher; if not, oil will probably head for $47. The dollar ("Dixie" or .DXY) is down down 0.78% to 85.623. The commodity index (.CRB) is up 0.23% to 219.50.

Gold gets a nice pop above $900, up $13.9 to $906.4 (June contract); Silver follows, up $.435 to $12.740; Copper drops below 2-bucks at $1.9905; Molybdenum still sits below $8.

The DOW is up 26 points to 7909.09; the S&P 500, up 2.18 points to 845.73. Gold miners are looking good:

Barrick (ABX) $29.72 up 4.65%
Newmont (NEM) $39.18 down 2.11%
General Moly (GMO) $1.56 down 1.27%
Freeport McMoran (FCX) $39.35 is down 2.72% (a bellwether mining stock spanning gold, copper & molybdenum)

Steel stocks are down today (so-so news for General Moly):

Nucor (NUE) 40.63 up 3.34% - domestic steel manufacturing
ArcelorMittal (MT) 26.48 down 0.27% - global steel producer

Cheers,

Colonel Possum

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