18. June 2021 | 11:34 CET
Bayer, White Metal Resources, Barrick Gold - Trendsetting news
At Federal Reserve's meeting, runaway inflation was the topic par excellence. With US consumer prices up 5% in May, market participants assumed at least an announcement of a pullback in bond market volume. However, an interest rate hike, which would actually be necessary for price stability, is not considered before 2023, according to FED Chairman Jerome Powell. Thus, through the continued ultra-loose monetary policy, he refers to the attitude that economic growth and a rising stock market are more important than low inflation.
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ISIN: DE000BAY0017 , CA9640461062 , CA0679011084
"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
Barrick Gold - Weak in the train of the overall market
One would have expected rising stock markets following the meeting after the way was paved for further growth. Nevertheless, the Dow Jones sank by more than 200 points in the course of trading. The reason given for this was that 7 of a total of 12 members of the FOMC now expect a first interest rate hike as early as 2022. At the last meeting in March, there were only 4 participants.
The biggest loser of the monetary policy decisions was the gold price. Although there will be no change in the framework conditions on the interest rate front or in bond purchases soon, the precious yellow metal rushed down by more than 5% at the peak and tore several prominent support areas in the process. Currently, the gold price is quoted at USD 1,778. The next support is at USD 1,732, and if it falls below, the double bottom at USD 1,680 could be tested again.
A bullish sign would only be a return above the 1,862 mark. The share of the largest gold producer, Barrick Gold, has been tending towards weakness for days. After the break of the upward trend formed since March at USD 23.50 last Friday, the next support zone is around USD 21.50. If that is broken due to the weak gold market, the April low at USD 19.44 is the next target.
White Metal Resources - Pleasing development
In contrast, the share of the project generator of White Metal Resources shows stability. The business model of the Canadians consists of searching for exploration objects and developing them further in cooperation with a suitable joint venture partner. In Ontario, the Company already owns 4 project options. However, the focus here is clearly on the Tower Stock Gold project. Here the Company has an opportunity to acquire 100%.
The concession area, where hardly any exploration activities have been undertaken for more than eight years, is located about 40 km northwest of the port city of Thunder Bay and covers an area of approximately 1,968 hectares. The property's geology is similar to Alamos Gold's Young Davidson Mine, one of Canada's largest underground mines. In early June, it was announced that White Metal Resources is planning a 3,000 m drill program at the Tower Stock project. The diamond drilling program is expected to start in the first week of July and last at least four weeks. Drilling will initially focus on the Ellen Zone to assess the possibility of extending the zone to the north and south.
In addition to its focus on the Ontario area in Canada, the Company has a second flagship project, the Okohongo copper-silver project in Namibia. The geology is similar to the Central African Copperbelt (CAC) in Zambia. CAC contains an estimated 5 billion tons of copper at grades up to 4%. Here, the Company drilled 28 holes and has now released the results of the last 15 holes. Additional copper-silver deposits have been proven on the 19,850-hectare copper-silver property and are expected to add to the existing drill hole data.
The busy management team plans to steadily expand the portfolio. The two main projects have significant potential. With a market capitalization of just EUR 4.4 million, the intrinsic value should already be significantly higher.
Bayer - Horrendous news ignored
Despite the catastrophic report of the partner CureVac, the price of the pharmaceutical giant Bayer shows strength and even trades at EUR 53.50, up almost 1%. After the vaccine manufacturer announced that its vaccine candidate CVnCoV had achieved only a preliminary efficacy of 47% against a corona disease "of any severity" in an interim analysis, the stock of the Tübingen-based Company sank by more than 50% at times.
Now the pharmaceutical giant announced that it would continue its cooperation with CureVac despite the setback. The Leverkusen-based Company will support the start-up with services in areas such as development and logistics. According to the original plan, the vaccine will be produced in Wuppertal from December.