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Oreninc Index: August 20, 2018

Oreninc Index: August 20, 2018

ORENINC INDEX up as metals market gets ugly

ORENINC INDEX - Monday, August 20th 2018

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Last week index score: 13.29 (updated)

This week: 19.32

NuLegacy Gold (TSXV:NUG) completed the second and final tranche of a non-brokered private placement with 4.0 million units @ C$0.20 for gross proceeds of C$795,781. 

The Oreninc Index bucked the market in the week ending August 17th, 2018 as it increased to 19.32 from an updated 13.26 a week ago as a flicker of life emerged from the summer doldrums.

An ugly week saw a large downward correction in precious and base metals prices, compounding gloom on the mining sector, but perhaps finally signalling a bottom to the market malaise of recent months. Few names were spared as investors dumped mining stocks and metals mid-week as the yellow metal slid to a 17-month low amid fears that the currency crisis in Turkey and growing trade spat between the US and China could boil over into a full-blown trade war. Gold has been knocked off its pedestal as the go-to risk-off investment so far in 2018 as strong rhetoric from the US Whitehouse continues to drive the US dollar and US stock markets. And investors continued in step with this recent history seeking the US dollar as their risk-off investment. BMO Capital Markets noted that base metal pricing seems to be driven more by financial markets at present and lack fundamental basis.

On to the money: total fund raises announced rose to C$25.3 million, a three-week high, which included no brokered financings and no bought deal financings. The average offer size fell to C$1.4 million, a one-week low, whilst the number of financings increased to 17, a three-week high.

Gold crashed through the US$1,200/oz floor bottoming out at US$1,174/oz mid-week before recovering slightly to close the week down at US$1,184/oz from US$1,220/oz a week ago. It is now down 9.10% this year. The US dollar index continued at strong levels, softening slightly to close at 96.13 from 96.36 last week. The van Eck managed GDXJ followed gold of the cliff down to US$26.81 before recovering to close down at US$27.49 from US$30.60 a week ago. The index is down 19.46% so far in 2018. The US Global Go Gold ETF also lost a lot of ground to close down at US$10.75 from US$11.93 a week ago. It is now down 17.34% so far in 2018. The HUI Arca Gold BUGS Index closed down again at 142.43 from 159.92 last week. The SPDR GLD ETF continued in sell mode with its inventory closing down at 772.24 tonnes from 786.08 tonnes a week ago.

In other commodities, silver fell below the US$15/oz mark to close down at US$14.80/oz from US$15.31/oz a week ago. Copper also continued to lose ground to close down at US$2.64/lb from US$2.74/lb last week after hitting a low point of US$2.56/ln mid-week. Oil’s slide continued as it closed down at US$65.91 a barrel from US$67.63 a barrel a week ago.

The Dow Jones Industrial Average returned to growth as it rose to 25,669 from 25,313 last week. Canada’s S&P/TSX Composite Index fell a smidge to close down at 16,323 from 16,326 the previous week after clawing its way back from 16,148 mid-week. The S&P/TSX Venture Composite Index continued to fall closing down at 678.01 from 693.75 last week.

 Summary:

·         Number of financings increased to 17, a three-week high.

·         No brokered financings were announced this week, a four-week low.

·         No bought-deal financing was announced this week, a nine-week low.

·         Total dollars grew to $25.3m, a three-week high.

·         Average offer size fell to $1.4 m, a one-week low.

 

Financing Highlights

Aben Resources (TSXV:ABN) opened a non-brokered private placement of up to 13.3 million units @ C$0.30 to raise gross proceeds of up to C$4.0 million.

·         Each unit will consist of one share and a warrant exercisable @ C$0.45 for two years.

·         The lead order is for C$2.0 million from Eric Sprott who will subscribe for 6.7 million units. Palisade Global Investments will subscribe for 2.8 million units and Venture Ad Network 600,000 units.

·         Proceeds will be used to expand the 2018 exploration and drilling program at the Forrest Kerr gold project in the Golden Triangle of British Columbia.

Major Financing Openings

·         Aben Resources (TSXV:ABN) opened a C$ 4 million offering on a best efforts basis. Each unit includes a warrant that expires in two years.

·         Primary Cobalt (CSE:PRIM) opened a C$ 3 million offering on a best efforts basis. Each unit includes a warrant that expires in a year.

·         Goldstrike Resources (TSXV:GSR) opened a C$ 2.5 million offering on a strategic deal basis. Each unit includes a warrant that expires in three years.

·         Fission 3.0 (TSXV:FUU) opened a C$ 2.5 million offering on a best efforts basis.    

Major Financing Closings

·         Allegiant Gold (TSXV:AUAU) closed a C$ 4.95 million offering on a best efforts basis.    

·         Sokoman Iron (TSXV:SIC) closed a C$ 3 million offering on a best efforts basis.

 

Company News

NuLegacy Gold (TSXV:NUG) completed the second and final tranche of a non-brokered private placement with 4.0 million units @ C$0.20 for gross proceeds of C$795,781. 

·         Together with the first tranche it raised C$2.5 million from 12.7 million units.

·         OceanaGold participated for 2.1 million units for C$419,907 to maintain its equity ownership position at 16.2%. Directors and officers participated for 4.5 million units for C$905,174.

·         Each unit consisted of one share and a warrant exercisable @ C$0.30 for two years.

·         The net proceeds will fund further exploration of the Red Hill project in Nevada.

 

 

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