Wednesday, April 21, 2010
GMO Makes Top Mining Stock, Loonie Boots Greenback
It is 5:56 AM. The coffee pot is hot - let's start hump day with some good news! Kitco Metals flagged General Moly (GMO) as the top performing mining equity in yesterday's trading from their tracking group of 37 metal miners. The list includes our other favorites Freeport McMoRan (FCX) and Thompson Creek Metals (TC). Although Kitco excludes gold miners in this compilation, GMO also easily beat Barrick (ABX) and Newmont (NEM) rising 4.19% to close at $3.77. Never a bad day to be the lead dog in this pack. We'll check on how they're doing today when the markets open in a few minutes.
If you offered to sell me one thousand Canadian dollars this morning I'd have to pay you $1004.92 in U.S. dough. If you work for Barrick it might be a good idea to ask your boss to start paying you in Loonies. The irony is that the U.S. dollar is showing strength against the two other great reserve currencies of the world, the euro and the yen. As reported yesterday by the Wall Street Journal:
"...the Bank of Canada held its benchmark overnight rate steady at 0.25% but dropped a year-long pledge to hold it at that level through the second quarter, saying it was 'appropriate' to lessen the degree of stimulus. The decision is seen paving the way for a June rate hike. The Canadian dollar jumped." (WSJ, 4/20/2010)
I'll have to give it to our friends up north. It doesn't hurt to be a resource-rich country with sensible banking policies as we roll down the bumpy global recovery highway. Maybe there's a lesson here for other big developed nations.
OK, the markets are open and General Moly comes out punching touching $3.82 in early trading. The champ has had a good run since the March 5 Hanlong agreement to fully fund the Mt. Hope project (A Game Changer for General Moly & Eureka County). Apparently the investment community agrees. There is further good news on the latest agreement between GMO and the world's largest steel producer, ArcelorMital (MT). Here's this week's press release:
GENERAL MOLY ANNOUNCES ARCELORMITTAL TO WAIVE ANTI-DILUTION RIGHTS FOR HANLONG TRANSACTION (4/19/2010 Press Release)
General Moly's Annual Meeting of Stockholders will be held on May 13, 2010 at 9:00am Mountain time, at the Marriott Denver West in Golden, Colorado. The ole Colonel just received his stockholder package in the mail which includes their 2009 Annual Report. It's a dandy, pardner.
Enough talk, let's walk the walk:
4-WD is OFF - smoother markets return; the VIX or "fear index" has moved back down to the 15-16s far below 25; metals & miners are looking good with benchmark FCX comfortably above $74, 10-year Treasurys are safely below 4% preserving a low-interest rate environment (what's this?)
The YELLOW light is switched back on our fuel gauge with oil above $80
A ORANGE light is ON for possible adverse regulation/legislation: Mine Safety Violations, Miner's claim fee, Miner taxation, Cortez Hills & mercury emissions
Otherwise, all lights are green on the Eureka Outlook Dashboard (upper right, what's this?)
NYMEX/COMEX: Oil is up $0.20 in early trading to $84.05 (June contract, most active); Gold is up $3.0 to $1142.2 (June contract, most active); Silver is up $0.049 to $17.870 (May contract); Copper is down $0.0175 to $3.4960 (May contract); Western Molybdenum Oxide sits at $17.25, LME moly 3-month seller's contract remains at $18.14
The DOW is up 31.14 points to 11148.20; the S&P 500 is up 2.65 to 1209.82. The miners are mixed:
Barrick (ABX) $39.52 up 0.98%
Newmont (NEM) $51.55 down 0.04%
US Gold (UXG) $3.09 up 0.65%
General Moly (Eureka Moly, LLC) (GMO) $3.80 up 1.88%
Thompson Creek (TC) $13.15 up 0.08%
Freeport-McMoRan (FCX) $79.11 down 0.40% (a bellwether mining stock spanning copper, gols & molybdenum)
The Steels are down, (a "tell" for General Moly & Thompson Creek):
ArcelorMittal (MT) $43.22 down 1.44% - global steel producer
POSCO (PKX) $118.78 down 0.17% - South Korean integrated steel producer
The Eureka Miner's Grubstake Portfolio is is up 0.08% to $1,414,957.11 (what's this?).
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Headline photograph by Mariana Titus