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Oreninc Index: July 29, 2019

 

ORENINC INDEX doubles as bought deals return

ORENINC INDEX - Monday, July 29th 2019

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Last week index score: 24.37

This week: 50.37

 

The Oreninc Index more than doubled in the week ending July 27th, 2019 to 50.37 from 24.37 a week ago as bought deals return.

US president Donald Trump has dialled up his rhetoric against the US Federal Reserve as he seeks an interest rate decrease to soften the US dollar. The Fed is widely expected to reduce interest rates when it meets on Wednesday.

Boris Johnson became the new prime minister of the UK and immediately clashed with the European Union (EU) over reopening negotiations for the country to leave. The EU has made its position firm and clear that it will not deviate from the terms agreed with former UK prime minister Teresa May, which the UK Parliament rejected in three separate votes. Johnson said he will not negotiate unless the Irish backstop position which ensures there is no hard border between the Republic of Ireland and Northern Ireland (part of the UK). As things stand, and if Johnson and hardline Tories have his way, it looks like the UK will leave the EU on October 31st without a deal. On the EU will agree another deadline extension.

On to the money: total fund raises almost doubled to C$68.4 million, a two-week high, which included three brokered financings for $43.5 million, a two-week high and three bought-deal financings for $43.5 million, also a two-week high. The average offer size increased to $3.1 million, a two-week high, while the number of financings increased to 22.

Gold continues to enjoy the high-life about the US$1,400/oz level although it closed down at at $1,418/oz from $1,425/oz. The yellow metal is up 10.64% so far this year. The US dollar index continued its growth as it closed up at 98.01 from 97.15 last week. The Van Eck managed GDXJ retrenched as it closed down at US$38.57 from $39.49. The index is now up 27.63% so far in 2019. The US Global Go Gold ETF however closed up a cent at US$15.80 from $15.79 a week ago. It is up 38.48% so far in 2019. The HUI Arca Gold BUGS Index closed down at 206.90 from 210.93 last week. The SPDR GLD ETF saw its inventory reduce to 818.14 tonnes from 820.49 tonnes a week ago.

In other commodities, silver continued to power up as it closed up at US$16.40/oz from $16.20/oz a week ago. Copper gave back last week’s gains as it closed down at US$2.68/lb from $2.75/lb a week ago. Oil recovered from last week’s loses as WTI closed up at US$56.20 a barrel from $55.63 a barrel a barrel a week ago.

The Dow Jones Industrial Average continued to grow on the back of strength in tech stocks as it closed up at 27,192 from 27,154 a week ago. Canada’s S&P/TSX Composite Index closed up at 16,531 from 16,485 the previous week. The S&P/TSX Venture Composite Index closed up a smidge at 592.89 from 591.96 last week.

 

Summary

·       Number of financings increased to 22.

·       Three brokered financings were announced this week for C$43.5 million, a two-week high.

·       Three bought-deal financings were announced this week for C$43.5 million, a two-week high.

·       Total dollars bumped to C$68.4 million, a two-week high.

·       Average offer up to C$3.1 million, a two-week high.

                                                          

Financing Highlights

Silvercrest Metals (TSXV:SIL) opened a C$22.0 million offering underwritten by a syndicate led by National Bank Financial on a bought deal basis.

·       3.8 million shares @ C$5.85.

·       SSR Mining will exercise its right to maintain its pro rata ownership interest of up to 9.9% and agreed to purchase 718,000 shares for C$4.2 million.

·       Proceeds will be used for continued exploration and advancement of the Las Chispas project in Sonora, Mexico to feasibility level.

Rio2 (TSXV:RIO) opened a C$17.5 million offering underwritten by a syndicate led by Cormark Securities on a bought deal basis which was subsequently upsized to $22.0 million.

·       55.0 million units @ C$0.40

·       Each unit consists of one share and half a warrant exercisable @ C$0.50 for three years.

·       Eric Sprott subscribed for C$9.8 million and upon completion will hold 19.9% of Rio2.

·       Proceeds will be used to complete the a EIS baseline study at its Fenix gold project in Chile, prepare and file the EIS study with the Chilean authorities, complete engineering studies in preparation for mine construction, commencing permitting and a review of financing options for construction.

 

Major Financing Openings

·       Silvercrest Metals (TSXV:SIL) opened a C$22.0 million bought deal private placement underwritten by a syndicate led by National Bank Financial on a bought deal basis.

·       Rio2 (TSXV:RIO) opened a C$17.5 million bought deal private placement underwritten by a syndicate led by Cormark Securities on a bought deal basis. 

·       Americas Silver (TSX:USA) opened a C$13.06 million offering on a strategic deal basis.    

·       Radisson Mining Resources (TSXV:RDS) opened a C$4.0 million offering underwritten by a syndicate led by Laurentian Bank Securities on a bought deal basis.

 

Major Financing Closings

·       Golden Predator Mining (TSXV:GPY) closed a C$9.32 million offering on a strategic deal basis.    

·       Discovery Metals (TSXV:DSV.H) closed a C$9.0 million offering on a strategic deal basis

·       Desert Gold Ventures (TSXV:DAU) closed a C$3.5 million offering on a best efforts basis.

·       Strategic Metals (TSXV:SMD) closed a C$2.6 million offering on a best efforts basis.

 

 

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