23. April 2021 | 07:32 CET
Evonik, SKRR Exploration, AMS - Protect your money!
Yesterday, ECB chief Christine Lagarde appeared before the press to confirm the key interest rate of historic 0.0%. With the ultra-loose monetary policy, she follows US counterpart Jerome Powell, who wants to maintain this state until 2023. Inflation, which was already 2.6% in the United States in March, plays a subordinate role. At the same time, commodity prices are exploding at the moment. There is a threat of historic price increases with drastic consequences for the end consumer. Prepare yourself!
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ISIN: DE000EVNK013 , CA78446Q1000 , AT0000A18XM4
"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
Protection against crises and inflation
Everyone should now be aware that the world has not become safer after Donald Trump was voted out of office. On the contrary, tensions between the US and China and Russia have, if anything, become even more intense since the Biden administration. For this alone, an investment in gold as a crisis currency and "safe haven" would be worthwhile. However, the precious yellow metal should instead serve as capital and inflation protection. The warning signs for an uncontrollable upward price spiral are too dangerous. Historic debts of the Western industrialized countries, falling yields on US government bonds and rampant economic stimulus programs should already currently push the gold price into significantly higher realms.
"Still" in correction mode
If you look at the current chart of the gold price, you can see a brightening, but from a bullish sentiment, it is still far away. Since August, the price has corrected from over USD 2,060 to USD 1,680 in March. Twice, this critical support was successfully tested. Currently, the price is quoted at USD 1,787. An important step for further positive development would be a breakout of the upward trend formed since August at around USD 1,810. On the downside, the gold price should not leave the support line at USD 1,680; otherwise, this would likely result in a more significant, accelerated sell-off. We see strongly rising prices and new all-time highs based on the fundamental data in the long term.
Fundamentally, gold mining stocks are once again extremely attractive after the correction that has taken place. In addition to the heavyweights such as Barrick Gold or Newmont, there are interesting entry opportunities in smaller explorers.
A team of mining industry veterans has joined forces to build the next big thing. That is what happened with gold explorer SKRR Exploration. Under the leadership of CEO Sherman Dahl, a shell company was acquired last year and, as things stand, five world-class deposits were brought in. These are located in Saskatchewan, one of the world's most renowned mining areas, specifically in the Trans-Hudson corridor. SKRR believes that the Trans-Hudson Corridor is geologically similar to the Abitibi Gold Belt. The Abitibi Gold Belt, which straddles the Ontario-Quebec border, has historically produced approximately 200 million ounces of gold.
Drillers are running
Currently, the most significant project is Irving/Leland, which covers an area of more than 23,500 hectares and is less than 10 km from rival SSR Mining's producing Seabee Gold Mine. The program is planned for the whole year, so we expect the news flow to be continuous. By the end of 2022, the aim is to have determined a resource, giving the projects a definable commercial value. By then, at the latest, the majors, who are currently swimming in money, should take notice of SKRR Exploration. However, the management network is likely to get wind of the success story sooner. At the beginning of April, another small capital increase was carried out at CAD 0.27. The share, which investors can purchase in Toronto and Frankfurt, is quoted at CAD 0.18. A long-term success story could develop here.
Free from inflation
Companies in the healthcare sector suffer less from inflation fears, as price increases are typically passed on to the end consumer. In addition, the price currently plays a subordinate role in the fight against the Coronavirus, as in the case of Evonik. The specialty chemicals company has been working with the pharmaceutical industry for many years. In addition to production, the MDAX-listed group develops combinations of excipients and active ingredients, known as formulations. For BioNTech's vaccine, the Essen-based company is responsible for producing the lipids, along with Merck, the Darmstadt-based pharmaceutical and specialty chemicals group. Evonik produces two different lipids that, together with other such lipid-like molecules, enclose the messenger substance of the mRNA vaccine "Comirnaty" in a nanoshell. Only this makes it possible to release the active ingredient from BioNTech at the right place in the body, enabling the vaccine to take effect.
Evonik has now announced that it has made faster progress than planned to expand lipid production for BioNTech's Corona vaccine. The facilities at the Hanau site have been set up and the first lipids are being delivered. Initially, the production of larger quantities had only been announced for the second half of the year. After doubling its share price since March 2020, Evonik is currently struggling with the broad resistance line around EUR 31. However, after the performance of the last few weeks, a consolidation to the area around EUR 28 is likely to take place first.
Is the apple falling from the tree?
Things do not look good if you look at the chart of the Austrian provider of high-performance sensor solutions, AMS AG. At the beginning of 2018, it was still at CHF 80; currently, the share price is falling like a stone and is quoted at CHF 16. The reasons are obvious but have not yet been commented on by the Company. The technology giant Apple is said to no longer prefer AMS sensors in the future and has already started to install sensors from AMS competitors. Our advice: Hands off!