Oreninc Index: September 16, 2019

ORENINC INDEX UP AS BROKERED ACTION RETURNS WITH FORCE

 

ORENINC INDEX - Monday, September 16th, 2019

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Last Week: 42.99 (updated)

This week: 54.94

The Oreninc Index rose again in the week ending September 13th, 2019 to 54.94 from an updated 42.99 as bought deals and brokered deals returned with a vengeance.

This week saw the North American precious metals world descend on Colorado for the Precious Metals Summit in Beaver Creek. It will now transfer to Denver for the Denver Gold Forum this week.

The emerging gold bull continued to wobble as the gold price couldn’t make up its mind which side of US$1,500/oz it wants to be on.

Many observers expect the US Federal Reserve Open Market Committee meeting later this month to continue reducing interest rates. US President Donald Trump is certainly trying to pressure it to do so by tweeting interest rates should be reduced to zero or less. The European Central Bank continued to reduce rates last week when it reduced rates by 10 basis points as well as announcing its plans to buy €20 billion in bonds and other financial assets per month from November onwards.

The positive momentum this gave precious metals prices was short-lived however as Trump delayed the implementation of an additional 5% duty on US$250 billion of Chinese goods by two weeks from 1st October until 15th October. This followed an announcement by China that it would exempt 16 items from the tariffs it has imposed on US products. 

Meanwhile, Iran was accused of attacking Saudi oil plants with drones via Houthi rebels in Yemen.

Elsewhere around the world, pro-democracy protests in Hong Kong continue and the UK appears to be no closer to reaching an agreement with the European Union about how it will leave the block. Prime minister Boris Johnson suspended the UK Parliament for five weeks.

On to the money: total fundraises announced increased to $61.0 million, a four-week high, which included four brokered financings for $42.8 million, a four-week high, and seven bought-deal financings for $47.3 million, also a four-week high. The average offer size more fell to $2.3 million, a two-week low, while the number of financings increased to 26.

Gold saw a bumpy week before closing down at US$1,488/oz from $1,520/oz a week ago. The yellow metal is up 16.07% so far this year. The US dollar index softened as it closed down at 98.25 from 98.91 last week. The VanEck managed GDXJ saw a sell-off as it closed down at US$36.26 from $41.05 a week ago. The index is now up 19.99% so far in 2019. The US Global Go Gold ETF closed down at US$15.62 from $17.39 a week ago. It is up 36.98% so far in 2019. The HUI Arca Gold BUGS Index closed down at 204.14 from 228.24 last week. The SPDR GLD ETF saw its inventory sell down to 874.51 tonnes from 878.31 tonnes a week ago after hitting a mid-week high of 889.75 tonnes.

In other commodities, silver pulled back almost a dollar as it closed down at US$17.44/oz from $18.38/oz a week ago. Copper saw a better week as it closed up at US$2.69/lb from $2.55/lb a week ago. Oil continued to suffer as WTI closed down at US$54.85 a barrel from $55.10 a barrel a week ago.

The Dow Jones Industrial Average continued to rebound as it closed up at 27,219 from 26,403 a week ago. Canada’s S&P/TSX Composite Index also closed up at 16,682 from 16,442 the previous week. The S&P/TSX Venture Composite Index closed down slightly at 589.16 from 589.36 last week. 

Summary

• - Number of financings increased to 26.
• - Four brokered financings were announced this week for $42.8m, a four-week high.
• - Seven bought-deal financings were announced this week for $47.3m, a four-week high.
• - Total dollars increased to $61.0m, a four-week high.
• - Average offer increased to $2.3m, a three-week high.

 

Financing Highlights

Marathon Gold (TSX:MOZ) entered into a $20.0 million bought deal agreement with a syndicate of underwriters led by Canaccord Genuity and Sprott Capital Partners 

• - 2.7 million flow-through units @ $1.85 comprising one flow-through share and half a warrant.
• - 11.4 million units @ $1.32 comprising one share and half a warrant exercisable @ $1.60 for two years.
• - Over-allotment option of an additional 2.7 million flow-through units for an additional $5.0 million.
• - Proceeds will be used to continue exploration and development of the Valentine Lake gold project in Newfoundland, Canada.

 

Coro Mining (TSX:COP) announced a non-brokered private placement to raise $16.8 million with largest shareholders Greenstone Resources and Tembo Capital.

• - 145.9 million shares @ $0.115 
• - 28% premium to the $0.09 closing share price on September 9th.
• - Proceeds will be used to make the first US$6 million payment to acquire the remaining 49% interest in the Marimaca 1-23 claim in northern Chile it does not currently own to give it 100% control over the Marimaca project claims.

Major Financing Openings

• - Marathon Gold (TSX:MOZ) opened a $20.06 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis. Each unit includes half a warrant that expires in two years.
• - Coro Mining (TSX:COP) opened a $16.77 million offering underwritten by a syndicate led by Greenstone Resources on a bought deal basis.
• - Harte Gold (TSXV:HRT) opened a $6.0 million offering underwritten by a syndicate led by Echelon on a bought deal basis. 
• - King’s Bay Resources (TSXV:KBG) opened a $4.0 million offering on a best efforts basis. Each unit includes a warrant that expires in two years. 

Major Financing Closings

• - Talisker Resources (CSE:TSK) closed a $4.16 million offering on a best efforts basis.    
• - Dolly Varden Silver (TSXV:DV) closed a $3.5 million offering on a strategic deal basis.
• - Prophecy Development (TSX:PCY) closed a $2.6 million offering on a strategic deal basis.    
• - American Creek Resources (TSXV:AMK) closed a $2.26 million offering on a best efforts basis.
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Company News

Silver Spruce Samples More High Grade Gold Surface Mineralization at Cocula Advanced Gold Project

Silver Spruce Resources (TSXV:SSE) received gold, silver and base metal assays from new rock chip samples taken from the surface at the Cocula gold project in Jalisco State, Mexico, as part of the due diligence it is conducting.

• Nine out of 26 rock chip samples recently taken from surface outcrop returned gold assay values of 0.88g/t Au up to 12.55 g/t Au.