"On Tuesday, Nevsun Resources (TSX:NSU
<
https://www.google.ca/finance?q=TSE%3ANSU&ei=xPchVIn2OYHIigLiqoHwCA>,NYSEMKT:NSU)
continued to expand the resource at its Harena mining license, located just
10 kilometers from its Bisha mine and processing plant in Eritrea. Recent
drill results confirmed the extension of the deposit, while additional
geophysical surveys and drilling are ongoing"
http://resourceinvestingnews.com/76088-copper-price-steady-china-pmi-index-nevsun-resources-canoe-mining-bhp-rio-newmont.html
Copper Prices Steady Following Earlier Gains
Tuesday September 23, 2014, 4:30pm PDT
By Teresa Matich+ - Exclusive to Copper Investing News
A
s many investors will know, metals prices have suffered a fair drop in
recent weeks, driven by a strong US dollar, and copper has not been immune
to those losses. Though copper usually performs in tandem with the global
economy, supply worries and apprehension over demand from China have taken
a hit at prices in recent weeks.
The red metal rebounded from a three-month low today after the release of
positive manufacturing data from China, but finished flat overall.
According to Bloomberg, copper futures for delivery in three months on the
London Metal Exchange (LME) lost 0.1 percent and finished at $6,720 per
tonne, while futures on the New York COMEX dipped 0.1 percent to finish at
$3.035.
Those changes came after a boost in prices earlier in the day, when
three-month LME copper gained 0.65 percent to reach $6,764.
PMI: for better or for worse?
According to Reuters, the jump came after an HSBC flash reading on China’s
Purchasing Managers’ Index (PMI) for September returned 50.5, an increase
from 50.2 in August. Expectations had been for a drop to 50, so the
increase caught most market watchers and investors by surprise — especially
since, as the news outlet reported in a separate article, factory
employment in China recently touched its lowest level in over five years.
The 50-point line marks the boundary between growth and contraction, so it
should be good for the red metal that China’s economy is growing. However,
as Capital Economics’ senior commodities analyst, Caroline Bain, told
Reuters, the positive PMI also reduces the prospect of economic stimulus
from China, balancing out the positive news. “It is good that the Chinese
economy isn’t collapsing, but a weaker PMI (purchasing managers index)
number would have raised the likelihood of further stimulus from China,
which would have given a boost to copper,” she stated.
That stimulus would have helped, said Bain, because “[t]he property and
construction sectors in China are still not showing any signs of recovery.”
She sees signs of production ramp ups at copper mines as contributing to
further losses.
Similarly, Ed Meir of INTL FCStone told Fastmarkets, “[t]here is no doubt
that worries over China seem to be weighing on base metals and reversing a
good deal of the recent gains many of these have made.”
It would seem that Bain was not out of line in calling for production ramp
ups, as Newmont Mining (NYSE:NEM) increased its production forecast for the
year, stating on Monday that it has received an export permit from the
Indonesian government and will resume resume copper shipments this week.
The company bumped its forecast from 80,000 to 95,000 tonnes up to 120,000
to 125,000 tonnes for 2014, and increased its 2015 production numbers as
well.
Meanwhile, workers at Chile’s Escondida — the world’s largest copper mine —
went on a 24-hourstrike over health, safety and working hours issues,
Mining Weekly reported. Owned by BHP Billiton (NYSE:BHP,ASX:BHP,LSE:BLT)
and Rio Tinto (NYSE:RIO,ASX:RIO,LSE:RIO), the mine was responsible for 20
percent of Chile’s copper production last year, which is significant since
the country is the number-one producer of copper globally.
Certainly, investors will want to tread carefully in the metals markets at
the moment, but there are still companies putting out positive news.
Canoe Mining Ventures (TSXV:CLV) entered an agreement on Monday to acquire
a 100-percent interest in the Hamlin-Deaty Creek property near Thunder Bay,
Ontario. The acquisition is part of Canoe’s larger strategy to “consolidate
the Shebandowan copper gold belt” in the area. The company also announced a
non-brokered private placement in the amount of $300,000, with proceeds to
be used for project acquisitions and general working capital.
On Tuesday, Nevsun Resources (TSX:NSU,NYSEMKT:NSU) continued to expand the
resource at its Harena mining license, located just 10 kilometers from its
Bisha mine and processing plant in Eritrea. Recent drill results confirmed
the extension of the deposit, while additional geophysical surveys and
drilling are ongoing.
Cliff Davis, CEO of Nevsun, commented, “[o]ur exploration program at Harena
continues to be successful in demonstrating that our known resources remain
open for further expansion. The Bisha area is under-explored and we will
further assess Harena and the greater potential of the Bisha VMS belt.”
Securities Disclosure: I, Teresa Matich, hold no direct investment interest
in any company mentioned in this article.
Received on Wed Sep 24 2014 - 10:38:52 EDT