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Oreninc Index As The Number Of Financings And Dollars Increased

Commentaries & Views

Last week index score: 33.40 (updated)

This week: 44.47

Silverspruce Resources (TSXV:SSE) announced a non-brokered private placement to raise C$750,000.

The Oreninc Index increased in the week ending June 21st, 2019 to 44.47 from an updated 33.40 a week ago as the number of financings and dollars increased.

Gold pushed up to a six-year high as it blasted through the US$1,400/oz level mid-week on a $70/oz rise to hit a high of $1,415/oz as the US Federal Reserve indicating an easing of interest rates is coming while European Central Bank head Mario Draghi indicated that monetary stimulus could return in Europe. As a result, everything was up this week with the exception of the US dollar. Gold priced in Australian dollars hit its highest level ever at over A$2,000/oz and even copper caught a break, spurred higher by a week-long strike at Codelco’s massive Chuquicamata copper mine in Chile.

In geopolitical news, the USA was within minutes of launching a retaliatory attack on Iran after the Middle-Eastern nation shot down an unmanned US drone. The attack was called off by US president Donald Trump who said the retaliation would have resulted in a disproportionate loss of life.

Boris Johnson, who favors a hard UK exit from the European Union, has emerged as the front runner to lead the UK’s Conservative Party and therefore become the next prime minister, although a final vote will need be held for another few weeks.

On to the money: total fund raises announced increased to C$69.4 million, a six-week high, which included two brokered financings for C$8.6 million, five-week high and one bought-deal financing for C$6.6 million, a two-week low. The average offer size decreased to C$2.1 million, a two-week low, while the number of financings increased to 33.

Gold rocketed upwards to close the week at US$1,399/oz from US$1,341/oz a week ago. The yellow metal is up 9.13% so far this year. The US dollar index lost more than a point to close down at 96.22 from 97.57 last week. The Van Eck managed GDXJ added a big gain as it closed up at US$34.37 from US$31.51 a week ago. The index is now up 13.73% so far in 2019. The US Global Go Gold ETF also saw a rise as it closed up at US$13.82 from US$12.96 a week ago. It is up 21.12% so far in 2019. The HUI Arca Gold BUGS Index closed up as well at 189.99 from 173.74 last week. The SPDR GLD ETF saw a large inventory gain as it closed up at 799.03 tonnes from 764.10 tonnes from a week ago.

In other commodities, silver saw strong growth as it closed up at US$15.35/oz from US$14.88/oz a week ago. Copper also saw a strong move higher as it closed up at US$2.70/lb from US$2.63/lb a week ago. Oil saw a strong rebound as WTI closed up at US$57.43 a barrel from US$52.51 a barrel a week ago.

The Dow Jones Industrial Average saw more growth as it closed up at 26,719 from 26,089 a week ago. Canada’s S&P/TSX Composite Index also closed up at 16,525 from 16,301 the previous week. The S&P/TSX Venture Composite Index closed up as well at 592.57 from 587.84 last week.

Summary

  • Number of financings increased to 33.

  • 2 brokered financing were announced this week for C$8.6m, a five-week high.

  • 1 bought-deal financing was announced this week for C$6.6m, a two-week low.

  • Total dollars up to C$69.4, a six-week high.

  • Average offer decreased to C$2.1m, a two-week low.                                   

Financing Highlights

Jaguar Mining (TSX:JAG) announced a non-brokered private placement to raise up to US$25 million @ C$0.085.

  • Jaguar’s two largest shareholders both intend to participate and represent participation of US$19.896 million or 79.58% of the offering.

  • Eric Sprott (21.7% shareholder) will subscribe for US$15 million and Tocqueville Asset Management (19.6% shareholder) of US$4.896 million, 19.6% of the offering.

  • Proceeds will be used to make changes to its historically underperforming mineral properties in Brazil including increasing developed reserves,  improving and updating capital equipment and infrastructure, increasing gold production, expanding reserves, reducing expenses per ounce of gold produced, improving efficiencies and cash flow and reducing the financial distress caused by debt.

  • Jaguar currently has 328.5 million shares issued and outstanding. The offering will issue up to 394.1 million additional shares.

  • The offering is expected to close on or about July 8th.

Major Financing Openings

  • Jaguar Mining (TSX:JAG) opened a C$32.98 million offering on a best efforts basis.    

  • Northern Dynasty Minerals (TSX:NDM) opened a C$6.62 million offering underwritten by a syndicate led by Cantor Fitzgerald Canada on a bought deal basis. 

  • Luminex Resources (TSXV:LR) opened a C$5.0 million offering on a best efforts basis.    The deal is expected to close on or about July 16th.

  • Terraco Gold (TSXV:TEN) opened a C$4.72 million offering on a strategic deal basis.    

Major Financing Closings

  • Amarillo Gold (TSXV:AGC) closed a C$5.28 million offering on a best efforts basis.  Each unit included a warrant that expires in two years.

  • Western Uranium & Vanadium (CSE:WUC) closed a C$4.02 million offering on a best efforts basis. Each unit included half a warrant that expires in three years.

  • Benchmark Metals (TSXV:BNCH) closed a C$2.0 million offering on a best efforts basis.    

  • American Battery Metals (CSE:ABC) closed a C$1.5 million offering on a best efforts basis.

Company News

Silverspruce Resources (TSXV:SSE) announced a non-brokered private placement to raise C$750,000.

  • 15 million units @ C$0.05

  • Each unit consists of one share and a warrant exercisable @ $0.075 for two years.

  • Proceeds will be used for phase I drilling at the Pino de Plata project in Mexico.

Analysis

A modest raise which will provide initial drill testing of some key targets at Pino de Plata.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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