08. June 2021 | 07:44 CET
Gazprom, Desert Gold, Siemens Energy - Everything is getting more expensive!
Inflation is here. In May, prices in Germany rose by 2.5% over the year as a whole, according to initial calculations by the Federal Statistical Office. Driven by reduced capacities and consumers' saved purchasing power, experts expect price increases between 4 and 5% by the end of the year. Such levels last occurred at the end of 1992. Interest rates, which are kept close to zero by central banks, still act as an accelerant. Hedge your portfolio before it is too late.
time to read: 3 minutes by Stefan Feulner
"[...] Both the geology and the infrastructure around the project make for a very attractive cost structure. We expect to be able to produce at 50% of the current gold price. [...]" Bill Guy, Chairman, Theta Gold Mines Limited
Desert Gold - Substantial Opportunities
High government debt, currently the world debt is approaching the USD 300 trillion mark, fears of rampant inflation and central banks that have to stick to the loose monetary policy not to weaken the economy, are clear buying arguments for gold. Investors can profit by buying physical gold such as bars and coins or gold ETFs. An investment in mining shares of large producers or second-tier mining explorers offers the chance of disproportionate price gains.
One of these attractive investments is the share of the gold mining explorer Desert Gold Ventures. The Company has been able to announce groundbreaking steps for the future in recent months. However, these seemingly passed the international investor community by, so the Canadians' share price is still 50% away from the 2020 high. In the process, the Canadians are prospecting for gold in Mali. Mali is Africa's fourth-largest gold-producing country, with a 2019 yield of about 2.28 million ounces, and offers developers and producers plenty of prospective, under-explored and unexplored projects.
The Canadians' portfolio focuses on two gold exploration permits with large land areas: the SMSZ project and the Djimbala project in western Mali. The 410 km² SMSZ project is named after a 38-kilometer section of the Senegal-Mali shear zone in which it is located. The SMSZ is connected to five major mines to the north and south on strike, including B2 Gold's Fekola mine, Barrick Gold's Gounkoto and Loulo mines, and Allied Gold's Sadiola and Yatela mines. According to the Company, Desert Gold's 410 km² property is the region's most extensive contiguous non-producing land package. Exploration drilling is progressing ahead of schedule. Currently, just over 75% of the drilling program for the full year 2021 has been completed at the SMSZ project.
Next up are 170 additional aircore holes totaling 8,500 meters. Currently, drilling is scheduled for 21,630m. It is expected that this number will increase. Desert Gold's stock is in a sideways range that has been formed for months and is currently trading at CAD 0.17. A breakout above the CAD 0.19 mark would generate significant upside potential.
Gazprom - Without compromise
Undeterred by threats from the US to impose sanctions on his country, Russian President Vladimir Putin announced last Friday, at the St. Petersburg Economic Forum, that the 1230 km Nord Stream 2 Baltic Sea gas pipeline will be completed earlier than expected, as early as August. The first of two pipes were completely laid on Friday, he said. The second pipe should be ready in eight weeks at the latest. Gazprom is already ready to fill the pipeline with gas. Russian pipeline gas is "cleaner, cheaper and more reliable" than the US product obtained through fracking, he said. In addition, Russia is ready to continue implementing such international projects as Nord Stream 2, Putin stressed.
The primary beneficiary of Nord Stream 2 is gas giant Gazprom, in which the Russian state holds a stake. The pipeline will significantly increase sales in Europe in the coming years. In addition, demand for natural gas and crude oil is rising, especially in China and Turkey. With a price/earnings ratio of just 4, the share is still a long-term buy candidate despite the leaps in joy.
Siemens Energy - Green Highway
Unlike Nord Stream 2, Siemens Energy is all about transporting "green power." Thus, the Munich-based electrical and power engineering company has been contracted to provide and install converter technology for the planned South-East Electricity Highway. The nearly 500 km long power line with a transmission capacity of up to 2 GW is intended to ensure that surplus energy in the north can be transported away, and southern Germany can be supplied with predominantly green electricity. Siemens Energy is providing the necessary converter technology for the direct current line.
From a chart perspective, the share price of the Munich-based company shows clear weaknesses and is trading at just below EUR 25. The next support is in the area of the annual low at EUR 23.82. If this critical support does not hold, the share price threatens to fall back to the level around EUR 18.40.