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Oreninc Index Remains Strong in Holiday-Shortened Week

The Oreninc Index remained strong in the holiday-shortened week ending July 3, 2014. This week’s performance is characterized by good numbers, although it clearly does not match the previous week as indicated by a slew of two-week lows. Total dollars announced fell to $93.6m, a two-week low. Brokered dollars announced dropped to $36.5m, a two-week low, and bought dollars announced dropped to $32m, also a two-week low.

While financing activity remained up this week, deal-making subsided, which is unsurprising given the holidays in the US and Canada. It is a good sign that companies are able to raise cash in the first week of summer; a couple more weeks like the previous two, and the stronger weeks will become less of a surprise and more of an expected performance.

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Oreninc Index Scores Biggest Uptick of 2014

The Oreninc Index increased by its largest margin of 2014 for the week ending June 26, 2014. After last week’s implosion, this type of performance, where all metrics have increased by an impressive margin, is a welcome sight. Total dollars announced exploded to $188.4m, a 15-week high. Brokered dollars announced rose to $122.3m, a 15-week high; bought dollars announced increased to $92m, a 16-week high. 

In addition to the positive fundraising news, HudBay announced its long-awaited acquisition of Augusta Resources (and with it their Rosemont Copper project), in what is a follow-up of sorts to last week’s deal making in the copper space. While it is always good to see activity like this, it is important to remember that the positive fundraising numbers are likely a direct result of companies wanting to get news out before next week’s holiday-filled work week and the uptick in spot gold prices this week. Don’t expect the Index to stay at this level for very long, with it likely to trend down to a more modest level after next week.

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Oreninc Index Crashes in Deal-Heavy Week

The Oreninc Index crashed for the week ending June 19, 2014. This is a significant drop in activity in the financing space after last week’s rebound. Total dollars announced dropped to $19.8m, a YTD-low. One brokered deal was announced for $0.5m, a 25-week low; no bought deals were announced. While financing activity was down, there were a number of copper deals in the space, specifically First Quantum’s purchase of Lumina Copper and Aston Bay Holdings’ announced partnership with Antofagasta. 

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In another excerpt from Benjamin Cox's guest lecture to Simon Handelsman's Mine Business & Finance graduate class at the University of British Columbia, Benjamin discusses what he likes and doesn't like about certain industrial metals and minerals.

Oreninc Index Rebounds to Modest Levels 

The Oreninc Index returned to modest levels for the week ending June 12, 2014. After last week’s dramatic fall, the Index has returned to the relatively optimistic numbers we had seen in previous weeks. Total dollars announced rose to $157.8m, a three-week high. Seven brokered and bought deals were announced for $77.9m, five-week highs. The most impressive statistic of the week was an average deal size of $5.63m, a 14-week high. This continues the ongoing narrative that spring 2014 has had more activity than 2013, and gives us hope of an uptick. The next few weeks will be telling as we head into the summer solstice and the official start of summer. 

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