Minews. Good morning Australia, it seems to have been another good week for your market with gold again leading the way.
Oz. It wasn’t a bad week, but much of what happened down this way was a direct result of events in Europe, especially the after-shocks of the Swiss going deeper into negative interest rate territory, followed by the European Central Bank’s big bazooka of monetary stimulus.
The net result, apart from driving the euro to a 11 year low against the U.S. dollar, was to further bolster the case for gold as one of the world’s last safe haven investments, and to act as a trigger for the next big fall of the Australian dollar.
Minews. The fall of your dollar must be doing wonders for the local cash flows of gold miners.
Oz. And the rest of the sector because virtually everything the Australian mining industry sells is denominated in U.S. dollars and last week that fact seemed to have drawn local investors back into nickel and copper stocks despite the underlying prices of those metals slipping further on the London Metal Exchange.
Minews. We’ll get to prices in a little while but first let’s hear about the movements in key ASX indices and then go back to our routine of singling out any noteworthy movers from any sector.
Oz. The gold index, as you might expect, had another good week thanks to the local gold price hitting A$1,630 an ounce as the exchange rate fell to US79 cents. Last week’s 5.5 per cent rise in the gold index takes the increase over the past month to 32.4 per cent.
However, while gold was continuing to rise the wider metals and mining index did better with an increase of 7.3 per cent, thanks to strong performances by the two big boys, BHP Billiton and Rio Tinto, and solid performances by smaller nickel and copper stocks.
Both of the most closely watched mining indices, gold and metals, outperformed the all ordinaries index though that index also managed to gain a reasonable 3.5 per cent.
Minews. Now for those noteworthy movers.
Oz. The star of the week, though admittedly rising of a low base was a stock closer to you than me. Scotgold (SGZ), the ASX and AIM listed developer of the Cononish goldmine in Scotland, shot up by A1.3 cents, or 185 per cent, to A2 cents after announcing a big increase in reserves and resources at the historic mine.
MacPhersons, another stock with whiff of Scotland attached, albeit in name only, added A3.5 cents (33 per cent) to A14 cents after releasing a fresh resource upgrade and development update on its Nimbus silver and gold project near Kalgoorlie in Western Australia.
Strandline Resources (STA) earned its first headlines after reporting promising results from a magnetics survey of its exploration project at Fowlers Bay in South Australia which could point to structures containing base metals. On the market, Strandline initially had a near double-your-money experience with a rise of half-a-cent to A1.2 cents before settling back for a gain of A0.2 of a cent (28 per cent) to A0.9 of a cent.
Northern Star (NST) reached a fresh all-time high of A$2.18 on Thursday before easing back to close the week at A$2.10 for a gain of A12 cents. Early last month the stock was trading at A99 cents.
Panoramic (PAN) added A8.5 cents (22 per cent) to A47.5 cents after releasing fresh drilling results which appear to expand the potential of its Lanfranchi nickel project.
Sirius (SIR) was another nickel stock in the news but this time thanks to what seems to be a promising gold discovery at its Polar Bear project close to the big St Ives gold mine of Gold Fields. The gold discovery boosted Sirius’s share price by A43 cents (18 per cent) to A$2.78.
Minews. On that gold note let’s start our weekly call of the card with other gold stocks.
Oz. As you might expect with the gold index adding 5.5 per cent the trend was up, though the price moves this week were not as strong as previous weeks.
After the gold stocks already mentioned some of the best moves included: Evolution (EVN), up A10.5 cents to A99.5 cents. Newcrest (NCM), up A87 cents to A$13.80. Chalice (CHN), up A2 cents to A14 cents. Gold Road (GOR), up A5 cents to A38 cents. Resolute (RSG), up A4 cents to A42.5 cents, and Orbis (OBS), up A4 cents to A63 cents.
Minews. Over to the base metals, starting with nickel this week, please.
Oz. Panoramic was the best of the nickel stocks, other than Sirius with its gold discovery, but Western Areas (WSA) reported a solid quarter and part ownership of the Fowler’s Bay project with Strandline (mentioned earlier) which boosted its share price by A52 cents to A$4.05. Other nickel moves included Independence (IGO), up A50 cents to A$4.70, with part of that rise also attributable and to gold assets, and Mincor (MCR), up A1 cent to A67 cents.
Sandfire (SFR) was the best of the copper stocks, clawing back A41 cents to close at A$4.22. Oz Minerals (OZL) put on A33 cents to A$3.45. Hot Chili (HCH) added A3 cents to A16.5 while Rex (RXM) lost A1.5 cents to A11 cents.
Terramin (TZN) was the pick of the zinc sector with a rise of A2.5 cents to A14 cents. Mungana (MUX) lost half-a-cent to A9.5 cents while Ironbark (IBG) slipped four-tenths of a cent lower to A9.5 cents.
Minews. Iron ore next please.
Oz. Not much good news there with more downward pressure on the price of the underlying material. Moves, all down, included Fortescue (FMG), down A18 cent to A$2.13. Atlas (AGO, down A2.5 cents to A16.5 cents. BC Iron (BCI), down A8 cents to A45.5 cents, and Mt Gibson (MGX), down A3 cents to A21 cents.
Minews. Uranium, coal and graphite next, please.
Oz. Toro (TOE) was the only uranium stock to gain ground, albeit with a truly modest rise of one-tenth of a cent to A8.9 cents. Paladin (PDN) continued to melt away, shedding A3 cents to A32.5 cents, and Bannerman (BMN) was nine-tenths of a cent weaker at A5.5 cents.
Whitehaven (WHC) went against a downward trend among the coal stocks, adding A6 cents to A$1.27. Atrum (ATU) shed A6 cents to A$1.01, and Prairie Downs (PDZ) lost A2.5 cents to A34.5 cents.
Syrah (SYR) was the best of the graphite stocks, rising by A23 cents to A$3.56. Valence (VXL) and Talga (TLG) crept up by A1 cent each to A43 cents and A29 cents respectively.
Minews. The minor metals to close, thanks.
Oz. South Boulder (STB) was the big mover among an otherwise quiet grouping of fertiliser stocks, adding a sharpish A5 cents to A24.5 cents.
Alkane (ALK) was the pick of the rare earth stocks though probably more because of its gold interests. It added A2.5 cents to A25 cents.
Base (BSE) continued to be weighed down by political issues surrounding its titanium minerals mine in Kenya, slipping half-a-cent lower to A16 cents.
Minews. Thanks Oz.