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A long-awaited Spring arrived on Tuesday, so the cold moved back in, and today, there will be more snow in the greater Toronto area.
This week, Canadian markets have continued the positive trend and are up 7.5% year-to-date, and on Thursday, they moved to an all-time high. Oil and financial stocks provided much of the increase, and the possibility of US rate cuts also benefited Canadian shares. The Bank of Canada may now be feeling less pressure to cut rates in June but will likely wait for the U.S. Fed to move first.
In the U.S., the market continues the uptrend since the start of the year to all-time highs, with the S&P 500 breaking through 5200 and remaining in the range of 5225 today.
The Federal Reserve kept rates steady on Wednesday. It maintained forecasts for three rate cuts this year, pointing to the central bank’s confidence that the recent strength in inflation was an aberration from the deflationary trend. kept its benchmark rate in a range of 5.25% to 5.5%. The Fed is widely expected to keep interest rates unchanged next week and maintained forecasts for three rate cuts this year as the economy continues to be strong, with employment remaining high and corporate earnings solid. The U.S. dollar regained strength this week, up 2.8% since the start of the year.
The head of the Bank of England (B0E) said “we are on the way” to interest rate cuts after they were left unchanged at 5.25% this week, their highest for 16 years. The BoE still needed to see inflation fall further, but last month’s drop to 3.4% was “very encouraging and good news. The Bank of Japan (BoJ) raised rates for the first time in 17 years. They continue efforts to reignite recovery in the Japanese economy. The Australian central bank signalled some level of confidence that “down under” inflation is returning to its target range by leaving policy rates unchanged at 12-year highs of 4.35%. The Swiss National Bank cut its main interest rate by 25 basis points to 1.50% on Thursday, a surprise move, which made it the first major central bank to dial back tighter monetary policy aimed at tackling inflation.
Precious metals were strong early in the week, but the lack of a Fed rate cut knocked them back on Thursday. Gold is up $100/oz year-to-date and reached a new all-time high last week trading, at $2,285/oz on Wednesday settling back to $2,176 this morning. Silver had been gaining for a week and is up to $24.70/oz this morning. Share prices of major producers and some mid-sized companies have been seen to be moving up. Junior exploration companies have not felt the benefit of the higher prices yet.
Base metals lost some ground this week as the U.S. dollar continued to be strong. Copper managed to hold above $4.00/lb. Battery materials continue to struggle as the EV market continues to fail to show significant gains, and Tesla announced production cuts at its China factories.
It has been a quiet week for our clients, and we are pleased to present our round-up between March 19-22, 2024.
Mining
On March 20, 2024, Sokoman Minerals Corp. (TSXV: SIC) (OTCQB: SICNF) provided a two-minute animated fly-through of the mineralized zones at the Moosehead Project in north-central Newfoundland. The presentation illustrates the 9 gold-bearing zones discovered to date, 7 of which carry high-grade quartz veins that host visible gold. The complex nature of the structures that control mineralization and their relationship to geology are shown. The current drilling at the 552 Zone is highlighted, and work is being done to build out and evaluate the Moosehead Property further.
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