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Oreninc Index: July 30, 2018

ORENINC INDEX continues to shrink

ORENINC INDEX - Monday, July 30th 2018

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Last week index score: 28.70(updated)

This week: 28.14

The Oreninc Index continued to shrink in the week ending July 27th, 2018 to 28.14 from an updated 28.70 a week ago as raise sizes plummeted again.

US gross domestic product grew 4.1% in the second quarter, which was the fastest pace of economic expansion since 2014, even if it came in a smidge under consensus forecasts. This added additional weight to support a strong US dollar and helped deflate gold’s move higher and away from the US$1,200/oz level. The US dollar has been on a roll since April, which has kept a foot atop of gold’s grow and repeatedly scuppered a potential breakout.

The coming week will see the US Federal Reserve Market Committee meet, and whilst a quarter point increase in interest rates is widely expected, the August 1st speech by chairman Jerome Powell will be scrutinised for bullish or dovish comments.

The chances of the UK agreeing an organised departure from the European Union (EU) look increasingly slim as the EU continues to knock back its ideas on tackling key issues such as the border between Northern Ireland and the republic of Ireland. The government of Prime Minister Teresa May is split on the key issues with the two sides diametrically opposed as to what the UK’s future relationship with the EU should be.

Incredible data point of the week was the more than US$118 billion erased from the market value of Facebook as its shares fell 18% after it reported disappointing growth figures following the Cambridge Analytica scandal. CEO Mark Zuckerberg’s wealth fell about US$17 billion in just one hour.

On to the money: total fund raises announced fell to C$29.5 million, a three-week low, which included no brokered financings and no bought deal financings. The average offer size halved to C$1.1 million, a one-week low, whilst the number of financings increased to 26, a seven-week high.

Gold continued to fall to close the week down at US$1,224/of from US$1,229/oz a week ago after fighting back to US$1,231/of mid-week. Gold is now down 6.03% this year. The US dollar index increased slightly to 94.67 from 94.48 last week. The van Eck managed GDXJ fell again to close down at US$31.92 from US$32.09 a week ago. The index is down 6.48% so far in 2018. The US Global Go Gold ETF also lost ground to close down at US$12.52 from US$12.63 a week ago. It is now down 3.77% so far in 2018. The HUI Arca Gold BUGS Index closed down at 165.65 from 172.02 last week. The recovery in the SPDR GLD ETF continued with its inventory closing up at 800.2 tonnes from 798.13 tonnes a week ago, although falling from a mid-week high of 802.55 tonnes.

In other commodities, silver remained at US$15.51/oz. Copper started to fight back as it closed up at US$2.80/lb from US$2.75/lb last week. Oil’s slide stopped as it closed slightly up at US$68.69 a barrel from US$68.26 a barrel a week ago.

The Dow Jones Industrial Average continued its winning streak to close up at 25,451 from 25,058 last week. Conversely, Canada’s S&P/TSX Composite Index continued its fall to close down at 16,393 from 16,435 the previous week. The S&P/TSX Venture Composite Index also closed down at 707.37 from 712.33 last week.

 Summary:

·       Number of financings increased to 26, a seven-week high.

·       No brokered financings were announced this week.

·       No bought-deal financings were announced this week.

·       Total dollars fell to C$29.5m, a three-week low.

·       Average offer size fell to C$1.1m, a three-week low.

 

 

Financing Highlights

American Lithium (TSXV:LI) opened and closed a non-brokered private placement for C$4.5 million.

·       11.25 million units @ C$0.40. Each unit comprised of one share and half a warrant exerciseable @ C$0.75 for two years.

·       The net proceeds will be used for lithium brine and claystone drilling programs at Fish Lake Valley in Nevada, future acquisitions and marketing.

 

 Major Financing Openings

·       New Point Exploration (CSE:NP) opened a C$ 5 million offering on a best efforts basis.    

·       American Lithium (TSXV:LI) opened a C$ 4.5 million offering on a best efforts basis. Each unit includes half a warrant that expires in two years.

·       Emerita Resources (TSXV:EMO) opened a C$ 3 million offering on a best efforts basis. Each unit includes half a warrant that expires in two years. The deal is expected to close on or about August 15th.

·       Axe Exploration (TSXV:AXQ) opened a C$ 2.25 million offering on a best efforts basis. Each unit includes a warrant that expires in 18 months.

Major Financing Closings

·       Advantage Lithium (TSXV:AAL) closed a C$ 12 million offering on a best efforts basis.   

·       Sandspring Resources (TSXV:SSP) closed a C$ 10.25 million offering on a best efforts basis. Each unit included warrant that expires in five years.

·       Lumina Gold (TSXV:LUM) closed a C$ 7 million offering on a best efforts basis.    

·       Labrador Gold (TSXV:LAB) closed a C$ 2.62 million offering on a best efforts basis.

 

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