Weekly Mining Commentary

Author: Sid Rajeev, Head Of Research

Global equity indices we track remained relatively flat last week.

 

Nickel prices remain highly volatile relative to other mainstream metals.

Week-over-Week (July 12, 2021) and Year-over-Year (July 12,2021)

Source: FRC / Various

LME Inventory (July 12, 2021)

Source: FRC / Various

SHFE Inventory (July 9, 2021)

Source: FRC / SHFE

Valuations of both gold and base metals producers were also flat WoW.

Gold Producers

Base Metal Producers

Source: S&P Capital IQ & FRC

Gold Producers and Base Metal Producers

Source: S&P Capital IQ & FRC

Six (five last week) out of the top 15 hardest hit nations (including the U.K., Spain, Russia, Iran, and Mexico) are experiencing a spike in new COVID-19 cases. The rise in cases in the U.K. is primarily attributed to the recently concluded European Championship. 69.4% of Canadians have received at lease one dose vs 68.6% at the same time last week. 43% of Canadians are fully vaccinated (previously 35%) vs 51% in the U.K. (50%), and 48% in the U.S. (47%).

At the end of May, approximately 25% of Canadians were unwilling or undecided as to whether or not to get vaccinated vs 15% in the U.K., 23% in Italy, 28% in Germany, 36% in the U.S., and 40% in France. We expect these figures to gradually decline as more people get vaccinated. On a positive note, we believe vaccine hesitancy in Europe and North America will result in increased vaccine supply in Asia and South America.

China’s economic activites slowed in Q2. The Chinese government is taking initiatives to encourage banks to boost lending. On the other hand, the U.S. is experiencing a strong rebound in economic activities and consumer confidence.

China’s Manufacturing, Index U.S. Manufacturing, Index U.S. Consumer Confidence

 We are maintaining our price forecasts. Gold prices are up US$30/oz since our note titled “An Opportunity to Buy Gold” on June 21, 2021. We are maintaining our positive near-term outlook on gold and silver.

FRC Forecasts

Weekly Mining Commentary

Author: Sid Rajeev, Head Of Research

Source: https://www.researchfrc.com/weekly-mining-commentary-75