Bear Market in Mining Sector near over
The mining industry has been in a bear market for nearly a half-decade. While tech stocks, banks and bonds surged, miners have collapsed and been ignored by investors. But things are changing on the mining front, and the tide may be turning right before our eyes. M&A activity in the junior resource sector has been picking up... and for good reason.
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Junior Mining Buyout Clues
May 17, 2015
Categories: Commodities, commodity sector, junior mining stock, junior resource sector, Mining, mining sector, mining stocks, US bull market, Weekly Volumes
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Dear member,
On May 6th, Federal Reserve Chair Janet Yellen shot an arrow across the bow of the US bull market by stating,
"I would highlight that equity-market valuations at this point generally are quite high."
Although the rally in US equities from the lows of 2009 is not outlandish (from a percentage standpoint) when compared to past bull markets, the lack of fundamental strength behind the US and global economy is likely what caused Yellen to make such a remark. And when one of the most dovish Fed chairs of all-time makes such a statement, it should give investors pause.
The below chart highlights the length of the current bull market. As of the first week of May, it became the third longest in US history.
Illustration: Dana Lipnickas/CNNMoney; Source: Bespoke Investment Group
One of the top bond investors on the planet, Bill Gross, recently concluded his monthly investment outlook -- aptly titled A Sense of an Ending -- with these ominous statements:
"As it is, in 2015, I merely have a sense of an ending, a secular bull market ending with a whimper, not a bang. But if so, like death, only the timing is in doubt. Because of this sense, however, I have unrest, increasingly a great unrest. You should as well."
source: https://www.janus.com/bill-gross-investment-outlook
With US equities pushed to the max, North American real estate (majority of hub cities) in a bubble and one interest rate hike away from correcting, inflation eating away at savings accounts, and bonds as pricey as they've ever been, there is one question investors are asking:What asset class is cheap?
Bear Market in Mining Sector near over
The mining industry has been in a bear market for nearly a half-decade. While tech stocks, banks and bonds surged, miners have collapsed and been ignored by investors. But things are changing on the mining front, and the tide may be turning right before our eyes. M&A activity in the junior resource sector has been picking up... and for good reason.
*Majors are once again looking to acquire juniors to stockpile reserves while commodity prices remain low
With the severity of this bear market in mining stocks reaching historic proportions, is it not prudent to consider this sector when looking for value?
Mining Sector: the Smartest Money in the Room
When it comes to the mining sector, the smartest money in the room belongs to senior producers. If this group of investors -- and that is exactly what they are -- sees value in distressed assets and is buying, there are deals to be had.
In an article published at Pinnacle Digest on January 19th, 2015 titled Let the buyouts begin: Goldcorp agrees to buy Probe Mines for C$526 million we discuss the impact of such a purchase from an industry leader:
"While Goldcorp's buyout of Probe Mines in no way justifies a trend, or even the beginning of a new bull market, it cannot be ignored. Buyouts and takeovers have long ushered in bull markets and lead to increased liquidity and financing availability in the junior resource sector. If gold can continue higher, this will not be the last major buyout we see in Q1."
While gold has not surged higher, it has held up quite well, currently sitting around $1,225 per ounce. More importantly, and as expected, a number of buyouts took place in and around Q1, signalling that majors see value in the junior mining sector (more on this shortly).
http://www.pinnacledigest.com/articles/junior-mining-buyout-clues
The mining industry has been in a bear market for nearly a half-decade. While tech stocks, banks and bonds surged, miners have collapsed and been ignored by investors. But things are changing on the mining front, and the tide may be turning right before our eyes. M&A activity in the junior resource sector has been picking up... and for good reason.
PINNACLE ACTIVITY TICKER
fastfoot commented on 10 Countries Now Facing DEFAULT AS Global Crisis Escalates -- What to expe...
Junior Mining Buyout Clues
May 17, 2015
Categories: Commodities, commodity sector, junior mining stock, junior resource sector, Mining, mining sector, mining stocks, US bull market, Weekly Volumes
More Sharing ServicesShare|Share on facebookShare on myspaceShare on googleShare on twitter
LOGIN or REGISTER
Dear member,
On May 6th, Federal Reserve Chair Janet Yellen shot an arrow across the bow of the US bull market by stating,
"I would highlight that equity-market valuations at this point generally are quite high."
Although the rally in US equities from the lows of 2009 is not outlandish (from a percentage standpoint) when compared to past bull markets, the lack of fundamental strength behind the US and global economy is likely what caused Yellen to make such a remark. And when one of the most dovish Fed chairs of all-time makes such a statement, it should give investors pause.
The below chart highlights the length of the current bull market. As of the first week of May, it became the third longest in US history.
Illustration: Dana Lipnickas/CNNMoney; Source: Bespoke Investment Group
One of the top bond investors on the planet, Bill Gross, recently concluded his monthly investment outlook -- aptly titled A Sense of an Ending -- with these ominous statements:
"As it is, in 2015, I merely have a sense of an ending, a secular bull market ending with a whimper, not a bang. But if so, like death, only the timing is in doubt. Because of this sense, however, I have unrest, increasingly a great unrest. You should as well."
source: https://www.janus.com/bill-gross-investment-outlook
With US equities pushed to the max, North American real estate (majority of hub cities) in a bubble and one interest rate hike away from correcting, inflation eating away at savings accounts, and bonds as pricey as they've ever been, there is one question investors are asking:What asset class is cheap?
Bear Market in Mining Sector near over
The mining industry has been in a bear market for nearly a half-decade. While tech stocks, banks and bonds surged, miners have collapsed and been ignored by investors. But things are changing on the mining front, and the tide may be turning right before our eyes. M&A activity in the junior resource sector has been picking up... and for good reason.
*Majors are once again looking to acquire juniors to stockpile reserves while commodity prices remain low
With the severity of this bear market in mining stocks reaching historic proportions, is it not prudent to consider this sector when looking for value?
Mining Sector: the Smartest Money in the Room
When it comes to the mining sector, the smartest money in the room belongs to senior producers. If this group of investors -- and that is exactly what they are -- sees value in distressed assets and is buying, there are deals to be had.
In an article published at Pinnacle Digest on January 19th, 2015 titled Let the buyouts begin: Goldcorp agrees to buy Probe Mines for C$526 million we discuss the impact of such a purchase from an industry leader:
"While Goldcorp's buyout of Probe Mines in no way justifies a trend, or even the beginning of a new bull market, it cannot be ignored. Buyouts and takeovers have long ushered in bull markets and lead to increased liquidity and financing availability in the junior resource sector. If gold can continue higher, this will not be the last major buyout we see in Q1."
While gold has not surged higher, it has held up quite well, currently sitting around $1,225 per ounce. More importantly, and as expected, a number of buyouts took place in and around Q1, signalling that majors see value in the junior mining sector (more on this shortly).
http://www.pinnacledigest.com/articles/junior-mining-buyout-clues
