₪ David Pescod's Late Edition March 30, 2006
GOLD $586.70 +13.40
SILVER $ 11.61 +0.545
BRAZMIN CORP. (T-BZM) $ 2.40 +0.02
There’s little doubt what the story of the day is today—
it’s commodity markets. Gold is flirting with 25-year highs
and silver is flirting with 23-year highs. Silver seems to be
carrying precious metals these days as the advent of the
Barclay’s ETF (exchange-traded funds) and how much silver
that will take out of the market, seems to be one of the stories
of the day.
Also, with continuing problems in Iran, a sudden drop in
the American dollar, gold has another huge move as well
lifting the precious metals sector in a big way.
Fund buying is part of it, hedge fund buying is also affecting
it and there are even reports that average folks in
some places in the world might be picking up a little precious
metals for the first time in decades as well.
But it’s not just precious metals that are moving, also
copper and base metals are going, sometimes for different
reasons. All of a sudden the mainstream press is picking up
what may be an impending problem in Peru where a presidential
election may elect an Ultra-Nationalist who might
just shake up a very strong mining community and change
rules dramatically.
Also, it is estimated that as much as 17% to 20% of some
of the base metal mines in the world, maybe facing a strike
over the next while and while in some places like Chile,
striking is more of a sport than an economic issue. These
things could affect supply.
Meanwhile, copper prices go through the roof as well.
Some stocks to note, one of our favorite silver stories is
currently in registration, so we can’t talk about it, but Impact
Silver continues to fair well. Its very high grades on its Royal
Mines of Zacualpan project in Mexico continues to attract
attention. There are not that many silver plays out there and
almost none of them are cheap, but Impact Silver looks like
it’s going to have lots to talk about in the next while.
In the gold sector, BrazMin has done surprisingly well
over the last four months, almost doubling, despite that fact
that it has done nothing. As we’ve mentioned before, it’s
the monsoon season in the Amazon and Brazil and that
means nothing gets done.
Now we are within days of work starting and what has
some analysts looking very excitedly at the company is the
thought that maybe they don’t have one or two, but potentially
three projects that could each become economic in
their time. Definitely, a story to be watching.
For a research report, contact Sandra Wicks at sandra_
wicks@canaccord.com.
In the base metals sector, we still continue to think that
the promotionally challenged Western Keltic Mines (WKM) is a
cheap story that covers the base and precious metals and
the price is just right and finally it looks like it’s going the
right way.
FALCON OIL & GAS (V-FO) $2.95 -0.01
The only thing that has changed with Falcon Oil and
Gas over the last two weeks since we first wrote about
it, is the price. It’s almost doubled and it now sports a
market capitalization of almost $1.2 billion. We have
called it scary before, it’s scarier now considering that
this company with this huge price tag has no cash
flow, no revenue and hasn’t even completed one well
yet. We hope by now you have read the interview we
had with Allan Laird and have a little better understanding
of the play, but the hope remains that they
may have the cure for Europe’s dwindling supplies of
natural gas. You are going to be hearing a lot more
about basin centered gas plays and this may be one
of them. Laird tells us that it’s still June that they expect
those final tests on the deep wells to occur and
they will be significantly important. Needless to say,
should these wells not work out…..
Disclosure: BrazMin Corp : Canaccord Capital covers this stock and has a Speculative Buy rating on it. (Speculative buy: Stocks bear significantly
higher risk that typically cannot be valued by normal fundamental criteria. Investments in the stock may result in material loss.)
Canaccord has recently led a financing for BrazMin Corp.
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