August 28, 2023 — Enjoying the new name for InvestorIntel, we are in the final countdown for a formal rebranding as InvestorNews. Also, in appreciating our Trending section, the #1 most read column right now is about Zentek Ltd. (NASDAQ: ZTEK | TSXV: ZEN), read: Revolutionary Aptamer-Based Pathogen Technology from Zentek Unveils Rapid and Inexpensive Pathogen Detection Capabilities.  

Also, started my morning with the commentator on the Australian Strategic Materials Ltd. (ASX: ASM) interview that the Critical Minerals Institute Co-Chairman Jack Lifton had with Rowena Smith that I would like to share with you. The commentator writes: “Wow that was a really great interview. I don’t understand why ASM isn’t on people’s radar and in particular Australia’s financial press has been missing in action. Hopefully, this interview will be the start of the re-rating of ASM’s achievements. When I talk to other investors in the REE space I haven’t had anyone spontaneously mention ASM.” This interview may be accessed on our Investor.Coffee YouTube channel and is titled — Redefining Rare Earths Supply Chain: A Conversation with ASM’s Rowena Smith.

Now onto the markets today, which according to the emails we receive daily have been summarized as follows — :

The markets have seen minimal fluctuations in recent times, with primary attention being centered on the impending economic data from Canada from this morning’s incoming sources. The anticipatory mood seems prevalent across global markets. Notably, U.S. stock index futures experienced a surge as crucial inflation and employment figures loom large. European technology stocks demonstrated an impressive performance, while in Asia, the Nikkei of Japan posted its most significant daily growth in two months.

In monetary matters, there has been a slide in the value of the U.S. dollar. This comes after Jerome Powell, the Federal Reserve Chair, indicated the potential for more rate hikes. Conversely, the euro, sensitive to Chinese market dynamics, enjoyed a slight uptick, following Beijing’s decision to reduce stamp duty on stock trades by half.

However, looming concerns persist in the global economic atmosphere. Record-high government debts combined with geopolitical strains, which jeopardize the cohesion of the global trade structure, paint a bleak picture. Furthermore, the continued lag in productivity gains hints at a future of sluggish growth, possibly hindering the developmental progress of certain nations.

This week’s spotlight will shine brightly on Canada’s Q2 GDP report, expected to unveil on Friday. Predictions from a Reuters survey of economists indicate a probable deceleration in economic expansion. Such a trend might make the Bank of Canada reconsider its stance on interest rate increments, even amidst mounting inflationary pressures.

In the automotive sector, Unifor, a Canadian union, recently announced that its members have greenlit strike mandates against the three primary Detroit automakers. This move empowers their negotiation teams to resort to job actions if deemed necessary to ensure equitable collective agreements.

In global stock market news, European futures, including the Euro STOXX 50 and German DAX, saw a rise in their early GMT trades. While Japanese shares rallied, concerns over a Chinese product ban impacted their tourism-related stocks adversely.

Oil prices, on the other hand, displayed marginal dips, attributed to apprehensions about China’s economic growth pace and potential U.S. rate hikes that might suppress fuel demand. The U.S. markets echoed a similar sentiment, with a modest rise in futures after Jerome Powell’s recent address, stressing the persistently high inflation rates.

From the corporate world, the UAW union at Ultium Cells (a collaboration between General Motors and LG Energy Solution in Ohio) publicized their members’ overwhelming approval of an interim pact that proposes a wage increase.

In other international news:

• China Evergrande Group, a globally renowned property developer, saw its shares plummet by almost 87%. This follows the company’s bankruptcy filing in the U.S. after a default last year and debt restructuring efforts earlier this year.
• A recent plane crash reportedly claimed the life of Yevgeny Prigozhin, the head of the Wagner mercenary group, confirmed by Russian genetic tests.
• The U.S. emphasizes the paramount importance of a stable economic bond with China, as iterated by U.S. Commerce Secretary, Gina Raimondo.
• Credit Suisse, now under UBS, reported a substantial loss in Q2 2023.
• BP underscores the necessity for investment in oil and gas production parallelly with efforts to expedite the energy transition to mitigate greenhouse gas emissions.
• Spanish investor Asterion clinches a deal with German utility Steag, directing the latter towards a greener future.

Stay tuned for more insights and updates on the global market here on InvestorNews!

InvestorTalk Disclaimer: The global financial spectrum is a vibrant mix of data, strategies, and forecasts. As the world watches, the financial domain remains ever-evolving and unpredictable, the global financial arena remains a complex interplay of a wide range of data and information. The InvestorTalk daily market update is an effort to organize the substantial accumulation of data sent to me and turn it into a summary of highlights intended for daily thought and collaboration as we move into our day. This editor is not an investment advisor and is neither offering buy or sell recommendations. The daily InvestorTalk series offers a data summary from information received by this editor. For more information or to send me more information, email [email protected]. Thank you.

A word of caution – I wrote this article before Jerome Powell’s (U.S. Federal Reserve Chairman) latest commentary. Lately, every time he opens his mouth the market loves to interpret him to the extreme as either dovish or hawkish, moving the markets accordingly. So keep that in mind if what I’m saying is so yesterday. The reason for this disclaimer is that market action over the last couple of days indicates that gold has tested and held the US $1,700(ish) support level. Yesterday saw most precious metal equities rally pretty hard, which is encouraging given a lot of them are trading at or near multi-year lows. Is this a sign of a new uptrend in the precious metals sector? One can hope. But without a copy of Mr. Powell’s speech I will have to wait and see along with everyone else what happens next. Now I can write whatever I want because I have a built-in excuse – blame it on Powell – which I’m sure a lot of analysts, traders and fund managers have used excessively over the last year.

Fed policy aside, it does appear that the materials sector is very oversold and long overdue for a little love. Or perhaps just a relief rally, something, anything, to give shareholders a bit of hope. Add a catalyst in a market that may be on the verge of recovery and perhaps we could even find gold investors in a good mood for a change.

One company that is working on a catalyst is Signature Resources Ltd. (TSXV: SGU | OTCQB: SGGTF), a Canadian-based advanced stage exploration company focused on expanding the 100% owned Lingman Lake Gold Project, located within the prolific Red Lake district in Northwestern Ontario, Canada. The Lingman Lake gold property consists of 1,434 staked claims, four freehold fully patented claims and 14 mineral rights patented claims totaling approximately 27,113 hectares. The property includes what has historically been referred to as the Lingman Lake Gold Mine, an underground substructure consisting of a 126.5-metre shaft, and 3-levels at 46-metres, 84-metres and 122-metres depths.

Lingman Lake has a 234,000 ounce historical high-grade gold resource estimate that is contained within the first 180 meters of surface and open in all directions. But the looming catalyst for Signature Resources is a NI 43-101 initial resource estimate which is anticipated shortly. In an update provided on June 29^th the company stated they were finalizing the compilation of the drill and assay database and doing 3D geologic modelling and analysis. A further update on August 30^th included the positive news that the company had identified a low-cost opportunity to capture additional data to increase the quantity and quality of the geologic knowledge of the deposit. This in turn led to new gold zones being identified. This is particularly encouraging when you look at it in the context of some of the highlights from the exploration drilling undertaken in late 2021:

• 6.64 g/t Au over 3.0 meters in LM21-26; including 18.5 g/t Au over 1.0 meters
• 6.97 g/t Au over 2.0 meters in LM 21-25
• 7.07 g/t Au over 4.0 meters in LM21-27; including 11.9 g/t Au over 1.0 meters
• 3.54 g/t Au over 2.0 meters in LM21-28A
• 8.24 g/t Au over 2.0 meters from 90 to 92 meters downhole; including 10.10 g/t Au over 1.0 m from 90 to 91 meters downhole in drill hole LM21-30 in the Central Zone
• 7.14 g/t Au over 2.0 m from 99 to 101 meters downhole; including 10.50 g/t Au over 1.0 m from 99 to 100 meters downhole in drill hole LM21-30 in the Central Zone

Something quite intriguing about Signature Resources is the fact that they have two 100%-owned drill rigs and about 10,000 meters of drilling consumables to support their next-stage drill campaigns. This is quite the head start given that upon the completion of the initial resource estimate the company expects it will have a strong technical plan for advancing a successive round of exploration that concurrently to expand the resource envelope and address gaps within the current drill database; thus supporting timely updates to the resource model. Now we sit and wait, along with the company, for the completion of that resource estimate.

However, despite having the drill rigs, consumables and just under C$1 million in cash, Signature still requires additional financing to pay for capital expenditures, exploration and administrative costs required to advance exploration on its Lingman Lake Gold Project. As long as the gold sector can continue to bounce off these lows, it should make it a lot easier for this C$5.5 million market cap company to get out and raise the capital it needs to advance this project.

C’mon Mr. Powell, don’t ruin this for us.