Aura Energy* (LON:AURA) – New shares in respect of a Lind convertible facility Rambler Metals & Mining* (LON:RMM) – Convertible loan note update Vast Resources* (LON:VAST) – Start of drilling at Baita Plai
SP Angel . Morning View . Monday 23 12 19
Global markets hover record highs ahead of Christmas holidays
MiFID II exempt information – see disclaimer below
Aura Energy* (LON:AURA) – New shares in respect of a Lind convertible facility
Rambler Metals & Mining* (LON:RMM) – Convertible loan note update
Vast Resources* (LON:VAST) – Start of drilling at Baita Plai
Dow Jones Industrials +0.28% at 28,455
Nikkei 225 +0.02% at 23,821
HK Hang Seng +0.13% at 27,906
Shanghai Composite -1.40% at 2,963
FTSE 350 Mining -0.81% at 18,893
AIM Basic Resources -0.66% at 2,004
Economics
A reversal in central banks’ monetary policy stance yielded major gains among a number of asset classes in 2019.
S&P 500 is up 28% with global stocks gauge up 23%.
Emerging market sovereign dollar bonds climbed 12% while global credit index increased 10%.
Even, US debt and gold posted 7% and 15% gains, respectively.
Strong 2019 performance was further attributed to a correction through Q4/18 allowing for a lower comparison base.
Adding the last three months of 2019 to the series suggests gold was among the best performing assets during the period (+24%).
Equities recorded slightly more modest returns including 10% for S&P 500 and 7% for global stocks.
The strong performance of investment grade credit and emerging market bonds was broadly similar even after including the 2018 turmoil amid a protracted period of low inflation and negative rates, according to Bloomberg.
US – Washington is planning to sign the Phase One deal “very shortly”, President Trump said on Saturday.
The S&P 500 benchmark extended its record highs to seven straight sessions on Friday, its longest series in more than two years.
China – Beijing will lower import tariffs on selected goods from the start of the year amid slowing economy and a trade war with the US.
Import tariff on frozen pork will be cut to 8% from 12% amid a deficit in the domestic market after a severe African swine fever nearly halved the China’s pig herd.
Pork imports for the first 11 months amounted to 1.7mt or up 58%yoy.
Frozen avocado import charges will be reduced to 7% from 30%.
Additionally, import tariffs on ferroniobium will be lowered from 1% to zero in 2020.
UK – The pound is flat against the US$ and € this morning as the House of Commons approved the PM’s draft Brexit plan on Friday in a 358-234 vote.
The draft legislation will face further scrutiny in the Commons and Lords in January, but is expected to pass all of its parliamentary stags of the UK’s planned departure date from the EU on the 31st of January, FT reports.
Currencies
US$1.1085/eur vs 1.1116/eur last week. Yen 109.37/$ vs 109.33/$. SAr 14.236/$ vs 14.223/$. $1.302/gbp vs $1.303/gbp. 0.692/aud vs 0.689/aud. CNY 7.012/$ vs 7.011/$.
Commodity News
Gold US$1,485/oz vs US$1,478/oz last week
Gold ETFs 81.1moz vs US$81.1moz last week
Platinum US$924/oz vs US$933/oz last week
Palladium US$1,885/oz vs US$1,944/oz last week
Silver US$17.40/oz vs US$17.06/oz last week
Base metals:
Copper US$ 6,183/t vs US$6,187/t last week – Copper falls amid thin pre-holiday trade (Reuters)
Copper prices fell for a second day today, due to thin pre-holiday trade in London.
Analysts expect there to be a lack of economic news this week for industrial metals such as copper to take its cue from.
Three-month copper on the LME fell 0.2% to $6,163.50/t earlier this morning.
The most-traded February copper contract in Shanghai closed down 0.4% at $6.996/t.
Codelco cancels $1bn desalination plant contract with Japan’s Marubeni (mining.com)
The world’s number 1 copper producer has cancelled the contract awarded in November, to construct and operate the plant which would supply water to the miners operations in northern Chile.
Codelco said in a statement that adjustments need to be made to the project, prompting a decision to redefine the tender.
Construction of the plant, with an initial capacity of 840L/s was due to start in Q1 2020, and be fully operational in 2022.
The miner has given no further details about the potential impact of the retendering of the plant, which was expected to reduce water consumption costs by 35% and become the country’s second-largest desalination plant.
The company’s annual profits fell by 1/3 last year to $2bn, due to a combination of falling production, lower copper prices and higher costs.
Aluminium US$ 1,806/t vs US$1,797/t last week
Nickel US$ 14,495/t vs US$14,190/t last week
Zinc US$ 2,314/t vs US$2,324/t last week
Lead US$ 1,916/t vs US$1,921/t last week
Tin US$ 17,320/t vs US$17,230/t last week
Energy:
Oil US$66.1/bbl vs US$66.5/bbl last week
Natural Gas US$2.231/mmbtu vs US$2.313/mmbtu last week
Uranium US$25.45/lb vs US$25.45/lb last week
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$90.7/t vs US$91.6/t
Chinese steel rebar 25mm US$568.9/t vs US$569.0/t
Thermal coal (1st year forward cif ARA) US$57.3/t vs US$57.8/t
Coking coal futures Dalian Exchange US$176.5/t vs US$176.6/t
Other:
Cobalt LME 3m US$32,750/t vs US$32,750/t
NdPr Rare Earth Oxide (China) US$40,790/t vs US$41,295/t
Lithium carbonate 99% (China) US$5,919/t vs US$5,920/t
Ferro Vanadium 80% FOB (China) US$28.5/kg vs US$28.5/kg
Antimony Trioxide 99.5% EU (China) US$5.1/kg vs US$5.1/kg
Tungsten APT European US$235-245/mtu vs US$235-245/mtu
Graphite flake 94% C, -100 mesh, fob China US$540/t vs US$540/t
Graphite spherical 99.95% C, 15 microns, fob China US$2,550/t vs US$2,550/t
Energy News
2019 hailed as ‘tipping point’ for renewable energy at mine sites (mining.com)
A recent report by consultancy firm THEnergy states that 2019 saw significant growth in the number of mining companies committing to develop onsite renewable energy projects.
The consultancy’s participation in the 7th Energy and Mines World Congress revealed that mining companies are becoming increasingly more willing to find environmentally- friendly solutions to their power needs.
Miners said that energy storage solutions are more sophisticated than before, so companies have more trust in the possibilities offered by clean energy and the minimised risks of production losses.
According to the report, the general attitude was changed from ‘wait and see’, to in 2019 ‘let’s act now’.
Evidence presented during the congress showed that the most newly announced projects combine different sources of renewable energy, such as solar and wind, along with effective energy storage solutions.
Mayor of London announces £4m investment into EV infrastructure (Current-News)
The mayor, along with London councils and TfL have announced a £4m investment into EV charging points, as part of the Office for Low Emission Vehicles’ (OLEV) scheme.
The investment will see 1,000 new charging points installed across the 29 boroughs, building on the existing 1,500 points already installed.
Company News
Aura Energy* (LON:AURA) 0.28p, Mkt Cap £3.9m – New shares in respect of a Lind convertible facility
The Company issued 66.7m new shares in relation to the sixth conversion notice received from Lind to convert A$200k of convertible notes.
Lind has now converted A$700k of the convertible security facility.
*SP Angel act as Nomad & Broker to Aura Energy
Rambler Metals & Mining* (LON:RMM) 2.6p, Mkt Cap £33m – Convertible loan note update
The Company is in discussions with CEIII regarding changes to terms of the senior secured convertible loan note that was due to mature on 28Nov/19.
*SP Angel act as Nomad and broker to Rambler Metals & Mining
Vast Resources* (LON:VAST) 0.28p, Mkt Cap £28.8m – Start of drilling at Baita Plai
CLICK FOR INITIATION REPORT
The Company commenced a drilling programme at the Baita Plai polymetallic deposit in Romania last week.
The programme is aimed at confirming grades and JORC-compliant mineral resource.
Additionally, the Company extended the exercise period of 521m of warrants (0.5p exercise price) by another six months to 30 June 2020.
*SP Angel acts as Broker to Vast Resources
Analysts
John Meyer – 0203 470 0490
Simon Beardsmore – 0203 470 0484
Sergey Raevskiy – 0203 470 0474
Sales
Richard Parlons – 0203 470 0472
Abigail Wayne – 0203 470 0534
Rob Rees – 0203 470 0535
SP Angel
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*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)
+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.
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