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Monday was very special with the Full Solar eclipse visible across much of North America. Traditionally eclipses were cloaked in scary uncertainty and considered as a very bad omen or an episode that marks a turning point. As if on cue, Central banks contributed some whiplash into the investment markets this week.
The Bank of Canada (BoC) on Wednesday continued holding its key interest rate at five percent. The official inflation rate has been below three percent for the past two months, something that hasn’t happened in more than two years. Bank Governor Tiff Macklem said he was more confident that inflation is heading back to the bank’s target, keeping the door to rate cuts this summer open. BoC wants to be “absolutely confident” that inflation will not flare up again before stepping off the sidelines. Market expectations are June at the earliest, with July the odds-on favourite. However, rate-cutting leadership from the U.S. Fed is desirable before a move in Canada.
A rate cut is looking a little more distant in the U.S. after the latest inflation data came out Wednesday showing the cost of living is still headed in the wrong direction for policymakers. The headline rate rose to 3.5 percent from 3.2 previously, while the so-called core rate that strips out volatile items like food and energy came in ever higher at 3.8 percent. U.S. markets dropped immediately following the release of the numbers, only to rebound on Thursday and the S&P 500 is struggling to hold 5200 this morning. Market sentiment now anticipates the Fed to start lowering borrowing costs in September, instead of June, with expectations of only two rate reductions this year instead of three.
The European Central Bank held interest rates steady for a fifth meeting while sending its clearest signal yet that cooling inflation will soon allow it to commence cuts. The deposit rate was left at a record-high four percent, but the Governing Council flagged a possible reduction contingent on its economic forecasts indicating consumer-price growth in Europe is safely headed to two percent.
The U.S. dollar index (DXY) powered up to 105.93 on Thursday, its strongest level since mid-November, a gain of 4.45% year to date. Higher for longer once more has the money moving into U.S. treasuries.
Precious metals continued to behave counterintuitively by falling on the U.S. inflation data only to power up again a day later with Spot gold hitting $2,400/oz last night and is at $2,405 this morning. Silver has gained $1.25/oz in the past 24 hours and sits at $29.46 this morning. The coming quarterly results of precious metal producers will start to reflect the price gains of more than 20% since February, share prices should react even more. How will that extra cash be deployed, increased dividends and share buybacks, or maybe buyouts of junior players with attractive projects who remain at depressed prices? Base metals have started to react positively despite the strong U.S. dollar. Copper got to $4.30/lb. today, where it has not traded since mid-2022. Global manufacturing demand seems to be increasing especially in China but in Europe as well.
Battery materials could not generate momentum and gain in price this week. Lithium remains at $15.55/kg. where it was three years ago. China’s control of this segment continues to confound prices.
It has been a week of important accomplishments for our clients, and we are pleased to present to you our round-up of their news released between April 8-12, 2024.
Mining
On April 11, 2024, Sokoman Minerals Corp. (TSXV: SIC) (OTCQB: SICNF) provided an update about the Fleur de Lys Project. The discovery of visible gold (VG) showings within the float (boulders) on a section of the project site highlights the rich potential of the area. Accessing these promising sites has been a challenge, with dense forest covering much of the terrain. The only ways to navigate through these rugged conditions have been on foot, by ATVs, or using snowmobiles, making exploration efforts slow and labor-intensive.
Thanks to the work of a local licensed timber harvester a considerable area has now been cleared, and a high-quality logging road constructed, drastically improving access to and across the site. Sokoman can now efficiently move drill equipment and manpower across the property. The logging road’s proximity to the Golden Bull VG showing, merely 14 metres away, is particularly advantageous. Although the property remains snow-covered for now, the improved access sets the stage for more thorough sampling, trenching, and prospecting activities. These efforts will be crucial in defining drill targets for our upcoming exploration program, promising exciting developments in the near future.
See Fleur de Lys Project, Golden Bull Area, Logging-Road Evolution! Video Here
It is so refreshing to see several of our small cap stocks recovering from their lows. I encourage you to check out Falcon Gold, (TSXV: FG) who are about to launch a drill campaign along strike with Benton Resources/Spruce Ridge high-grade VMS copper property in central Newfoundland. Falcon holds a 100% interest in 2,275 hectares in the Great Burnt camp where the mineralized corridor occurs along a conductive trend, and this conductive trend continues into Falcon’s Great Burnt Copper Property, where the geophysics has identified 9 priority drill targets.
Figure 1. Location of proposed drilling within Falcon’s recent acquisition proximal to the Benton – Spruce Ridge Great Burnt Copper-Gold joint venture in Central Newfoundland.
Fintech
On April 8, 2024, Tenet Fintech Group Inc. (CSE: PKK) (OTC Pink: PKKFF) announced the settlement of a presumed class action lawsuit brought against the Company and two of its executives on November 19, 2021, in the United States District Court for the Eastern District of New York, originally captioned Bram Van Boxtel v. Tenet Fintech Group Inc., et al., now captioned Alejandro Handal and Donald Dominique v. Tenet Fintech Group Inc., et al. Please see the Company’s Management Discussion and Analysis for the period ended September 30, 2023, under “Legal Proceedings” for further information regarding the Lawsuit.
The Company believes the settlement to be the best available option for the Company to allow it to move forward without the further expense and distraction of costly litigation in the United States while it focuses on its growth and development. This would include resuming the closing of additional tranches of the Company’s pending private placement financing, which had been temporarily paused while the settlement negotiations were being finalized. The settlement is subject to conditions, including, the approval of the United States District Court for the Eastern District of New York.
The terms of the settlement, set out in a binding memorandum of understanding signed on April 8, 2024, do not include any admission of liability or wrongdoing on the part of the Company or any defendant. In exchange for a full and final release of the Company and each defendant from the plaintiffs, the Company has agreed to pay the aggregate amount of USD$1,200,000, to be paid in five installments throughout the balance of 2024 with the last such installment by December 31, 2024.
Cannabis
On April 8, 2024, StickIt Technologies Inc. (CSE: STKT) announced its financial results for the year ended December 31, 2023, and a corporate update.
Financial Highlights for 2023:
On May 5, 2023, StickIt entered into a Technology License and Distribution agreement with Alta Inc. in Canada, granting Alta Inc. a license to utilize its raw materials and engage in the manufacturing of its products.
Significant investment in research and development to support innovation and product development, totaling CAD$101,000.
A notable year with the completion of a reverse takeover (RTO) on October 23, 2023, positioning StickIt for accelerated growth and market expansion.
Concurrently with the completion of the RTO, the Company completed a financing of CAD$441,000, consisting of 1,024,628 subscription receipts for CAD$0.4304 each, that were converted on a 1:1 basis into the Company’s common share
Operational Highlights:
Expansion into international markets with the establishment of a joint venture in Bangkok, Thailand, aiming to capitalize on global opportunities for our Extra-C sticks.
Secured a comprehensive patent portfolio, enhancing our competitive edge and underscoring our commitment to innovation. Noteworthy patents include US11582996 B2 in the U.S.A. and multiple grants across Europe, Canada, and Israel.
Continued focus on a growth strategy through joint ventures in regions where recreational cannabis is permitted, strengthening our global footprint and market reach.
StickIt is a technology company that invents and manufactures innovative products that can contain varying quantities of CBD/THC for recreational and medical cannabis users. Poised for ongoing expansion and deeper market reach into 2024 and beyond, StickIt aims to exploit its patent base, broaden its worldwide joint venture approach, and persist in innovation within the realm of cannabinoid accessories.
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