News Archive

Global stocks scale record highs as U.S. government shutdown ends, yen turns down

TOKYO (Reuters) – Asian stocks advanced on Tuesday after U.S. senators struck a deal to end a government shutdown in a boost to Wall Street, while the dollar turned higher against the yen after Bank Of Japan’s chief reiterated his support for quantitative easing.

Spreadbetters expected Britain’s FTSE .FTSE to open 0.3 percent higher, Germany’s DAX .GDAXI 0.5 percent and France’s CAC .FCHI 0.3 percent.

U.S. lawmakers passed a short-term measure on Monday to fund the federal government through Feb. 8.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.9 percent to a record peak.

Australian stocks climbed 0.75 percent and South Korea’s KOSPI .KS11 added 1.4 percent.

Japan’s Nikkei .N225 rose to a 26-year peak, Hong Kong’s Hang Sang .HSI scaled a record high and Singapore .STI reached a 10-year top.

World equity markets have been on a tear over the past year, buoyed by a synchronized uptick in global economic growth in a boon to corporate profits and stock valuations.

The brief U.S. government shutdown put only a minor dent to equities, with Wall Street rallying to all-time highs overnight following the deal to end the impasse in Washington. [.N]

In currencies, the dollar briefly dipped 0.33 percent to 110.550 yen JPY= after the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent.

The BOJ also said “inflation expectations have moved sideways recently,” offering a slightly more upbeat view than three months ago when it said they were on a weak note.

The central bank was still far from its peers who were looking for ways out of unconventional monetary policies.

“The BOJ kept is policies unchanged and made no real changes to its overall stance. It still remains a step behind other central banks looking to normalize their policies,” said Shusuke Yamada, chief Japan FX strategist at Bank of America Merrill Lynch.

The BOJ caused ripples in the markets earlier in January by slightly reducing the amount of longer-dated Japanese government bonds (JGBs) it buys from the market at its regular debt-purchasing operations.

The yen had appreciated significantly against the dollar as some traders speculated the central bank was preparing to scale back its massive stimulus.

In Tuesday’s press conference following the policy decision, BOJ Governor Haruhiko Kuroda put such notions to rest: “There is still some distance to 2 percent inflation, so we’re in no condition yet to debate the timing of an exit from ultra-easy monetary policy.”

In response, the dollar pulled back from earlier losses and was last 0.2 percent higher at 111.100 yen.

The euro was down 0.2 percent at $1.2240 EUR= after gaining 0.3 percent overnight. The common currency was still within reach of a three-year peak of $1.2323 set on Wednesday.

The euro was supported ahead of the outcome of the European Central Bank’s meeting on Thursday, which could provide clues to future shifts in the central bank’s monetary policy.

The pound was a shade lower at $1.3961 GBP=D3 after touching $1.3992, its highest level since June 2016’s vote for Brexit, on optimism that Britain will reach a favorable divorce deal with the European Union. [GBP/]

The dollar index against a basket of six major currencies stood rose 0.15 percent to 90.524 .DXY.

In the virtual currency world, bitcoin was down 4.5 percent on the Bitstamp exchange BTC=BTSP at $10,320.13 following news that South Korea will ban the use of anonymous bank accounts in cryptocurrency trading from Jan. 30. While it was a widely telegraphed move designed to stop virtual coins from being used for money laundering and other crimes, the step also underscored authorities’ intent to close down avenues for spurious speculation.

Oil prices rose on Tuesday, lifted by healthy economic growth as well as the ongoing supply restraint by a group of exporters around OPEC and Russia. [O/R]

U.S. crude oil futures CLc1 rose 0.6 percent to $63.94 per barrel and Brent gained 0.56 percent to $69.42 per barrel LCOc1.

Spot gold XAU= tacked on 0.2 percent to $1,336.70 per ounce.

Editing by Jacqueline Wong Shri Navaratnam

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South Korea to ban cryptocurrency traders from using anonymous bank accounts

SEOUL (Reuters) – South Korea will ban the use of anonymous bank accounts in cryptocurrency trading from Jan. 30, regulators said on Tuesday in a widely telegraphed move designed to stop virtual coins from being used for money laundering and other crimes.

The measure comes on top of stepped up efforts by Seoul to temper South Koreans’ obsession with cryptocurrencies. Everyone from housewives to college students and office workers have rushed to trade the market despite warnings from global policymakers about investing in an asset that lacks broad regulatory oversight.

The bitcoin price in South Korea extended loss following the latest regulatory announcement, down 3.34 percent at $12,699 as of 0409 GMT, according to Bithumb, the country’s second-largest virtual currency exchange.

Bitcoin BTC=BTSP slumped nearly 20 percent last week to a four-week low on the Luxembourg-based Bitstamp exchange, pressured by worries over a possible ban on trading the virtual asset in South Korean exchanges. In Tuesday afternoon trade, it was up 5.4 percent at $10,925.

Policy makers around the world are calling for tougher, coordinated regulation of cryptocurrency trading. South Korea’s chief financial regulator last week said the government may consider shutting down domestic virtual currency exchanges.

South Korea’s Presidential office has clarified that an outright ban on trading on the virtual currency exchanges is only one of the steps being considered, and not a measure that has been finalized.

“The government is still discussing whether an outright ban is needed or not, internally,” a government official who declined to be named said after Tuesday’s briefing.

Over the past month, government statements have underscored differences between the Justice Ministry, which has pushed for a more hardline approach, and regulators who have shown a reluctance to enforce an outright ban.

Starting Jan. 30, cryptocurrency traders in South Korea will not be allowed to make deposits into their virtual currency exchange wallets unless the names on their bank accounts matches the account name in cryptocurrency exchanges, Kim Yong-beom, vice chairman of the Financial Services Commission told a news conference in Seoul.

“Everyone knew this was coming, as the government already said they will enforce the real-name system before. Rather, I can see this as a chance to go in, not out. I don’t see any reason to take my money out,” said a local bitcoin investor who only agreed to be identified by his family name Ahn.

The regulator has previously said it will come up with detailed guidelines for local banks to properly identify its clients by their real names in cryptocurrency transactions.

To make deposits into virtual coin wallets, cryptocurrency traders will need to identify themselves with their real names at the exchange and have those matched with information at local banks by Jan. 30.

Reporting by Cynthia Kim; Additional reporting by Dahee Kim; Editing by Sam Holmes Shri Navaratnam

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Sign of returning life for lithium

ASX-listed lithium miner Galaxy Resources (AU:GXY) also looked up, gaining 4.3%.

In Canada, Nemaska Lithium managed a gain of 1.13% yesterday, although all three companies are yet to return to last week’s share price levels and Lithium Americas (CN:LAC) headed almost 4% lower.

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Global lithium stocks were sold off last week in the wake of dominant producer SQM getting expansion approval from the Chilean government.

Back in Australia, rare earths producer Lynas Corp (AU:LYC) was up close to 7% intraday, despite lower production due to an extended shutdown, as it outlined an improved balance sheet and record cashflow from operating and investing activities for the December quarter.

Meanwhile the gold price is slightly higher than this time yesterday at US$1,335 an ounce and the US dollar weaker, as US politicians agreed on a short-term funding arrangement to end the three-day government shutdown.

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Casino mogul Steve Wynn confident on Macau concession extension

HONG KONG (Reuters) – U.S. casino magnate Steve Wynn, head of the eponymous Wynn Resorts WYNN.0, said he was confident his casino business in the world’s largest gambling hub of Macau would continue after casino contracts start to expire by 2020.

The Chinese-controlled territory has been a goldmine for Wynn, generating more than 75 percent of its total revenues through subsidiary Wynn Macau (1128.HK).

The expiry of casino licenses in the former Portuguese colony has been a critical issue for operators, such as Sands China (1928.HK), MGM China (2282.HK) and SJM Holdings (0880.HK), with the first round of licenses due to expire in two years.

Wynn’s concession with the Macau government runs until 2022, but authorities have provided little information about whether, and how, the licenses will be renewed.

Wynn told analysts on a conference call on Monday that his confidence stemmed from talks with the government in Macau.

“We have been given reason to have confidence that our businesses will continue after the initial concession expiration dates,” he said. “That confidence is based upon the kind of conversations we have had with the government.”

Privately, some casino executives have expressed concern over the uncertainty, and have been making increasing efforts to stay on the right side of the authorities.

Wynn, who operates two luxury resorts in Macau and is also the Republican National Committee Finance chair, said China, which controls the special administrative region, was adamant about stability and did not like disruptions.

He had frequent discussions with casino bosses Sheldon Adelson, owner of Las Vegas Sands (LVS.N) and Sands China, and James Murren, head of MGM Resorts (MGM.N), he added.

“We are so stitched into that community, with our employees and our company, that we feel comfortable in this situation,” he said.

Wynn said the local government had encouraged him to file plans for the company’s second phase on Macau’s fast-growing Cotai strip, modeled after Las Vegas with large, glitzy properties.

The company said it had about 11 acres (5 hectares) of adjacent property to develop on the Cotai strip, but gave no further details.

Shares in Wynn Macau jumped as much as 8 percent on Tuesday, after the company reported better-than-expected earnings, boosted by strong revenues at its newest resort, Wynn Palace.

Macau’s licenses were first awarded in a complex process in the early 2000s. Government officials have said there may be a new public bidding process when they expire.

The casino sector is a huge part of Macau’s economy, employing two-thirds of its workforce, and paying taxes amounting to about 80 percent of government revenue.

Reporting by Farah Master; Editing by Clarence Fernandez

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Barrick goes back to partnership foundations

Barrick Gold (CN:ABX) is going back to the future to return to its roots and focus on harnessing partnerships that were a key part in the company’s early growth, president Kelvin Dushnisky told delegating during his keynote speech at the AME Roundup in Vancouver, Canada.

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Red Mountain opens up new White Rock fan base

CEO Matt Gill was this week promoting the White Rock (AU:WRM) story in Vancouver in the company’s first appearance at the Vancouver Resource Investment Conference.

The company has put out positive pre-feasibility study results on the Mount Carrington gold and silver project in New South Wales, Australia, where it has outlined gold reserves containing 159,000oz, and total resources of 341,000oz gold and 23.2 million oz of silver.

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But it is Red Mountain, acquired in 2016 and since enlarged through astute land deals, that holds the key to White Rock raising its profile in the North American market. Gill said the company was finalising its exploration budget for 2018, but its plan outlined in a late 2017 market release was to complete more geophysics and geochem surveys, and drill test extensions to the two known deposits plus new targets in the large land package, 100km south of Fairbanks.

Previous drilling and other exploration allowed White Rock to post a maiden JORC resource of 16Mt grading 9% zinc-equivalent, including 9.1Mt of 12.9% Zn-eq in a higher grade resource, which Gill claimed put Red Mountain in the top quartile of undeveloped VMS zinc-silver-gold deposits worldwide.

The company could spend A$500,000 or more on exploration this year. It had about $2.2 million in the bank at the end of September last year.

White Rock’s market capitalisation at the start of this week was $12.7 million.

Stock pundits, including newsletter writers and research groups, were many in number at VRIC and one, Fundamental Research Corp, is initiating coverage of White Rock – “their only ASX [mining] stock” under coverage, said Gill – largely on the back of what FRC head of research Sid Rajeev said was the blue-sky appeal of Red Mountain, its grades, and Alaska location.

Rajeev said White Rock’s advanced NSW gold project, and overall comparatively low enterprise value to value of defined resources, were other factors in the minnow’s favour, with upcoming development milestones for Mt Carrington likely catalysts for the stock.

But the Alaska connection would be what was likely to get the company noticed by FRC’s mainly North American and European subscribers.

Gill said results of the next exploration phase at Red Mountain would determine White Rock’s course of action to realise maximum value from the asset, with options including a dual listing.

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Franco-Nevada gains another Cobre Panama stream for US$178 million

Franco-Nevada said the terms were the same as the $178 million precious metals stream it signed in September with First Quantum Minerals’ (CN:FM) to help it fund the acquisition of a further 10% of Cobre Panama from LS-Nikko Copper.

Franco-Nevada said it expected to fund the combined $356 million without a syndication partner after CEF Holdings, previously named as a possible one-third partner, was unable to put a suitable structure in place to participate.

The company has an existing precious metals stream over First Quantum’s 80% interest in Cobre Panama and had funded $727 million of that $1 billion commitment by the end of 2017.

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The incremental 20% stream differs because Franco-Nevada is funding the full amount upfront and the ongoing payment for deliveries is based on a percentage of the spot price.

The $5.5 billion development project in Panama has overcome logistical challenges and is about 60% complete, and expected to produce about 300,000 tonnes per annum of copper over a 40-year mine life.

Franco-Nevada CEO David Harquail said phased commissioning was expected later this year and Cobre Panama was expected to “add materially” to the streaming company’s growth profile from 2019.

Franco-Nevada shares dropped 3.42% to C$94.51 yesterday, a mid-point in its 52-week range.

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U.S. product lets investors triple bet on popular tech stocks

(Reuters) – Investors are getting a high-octane way to bet on or against the stock market’s technology leaders.

A new product aims to let investors triple the return of 10 stocks, including the so-called FANG stocks – Facebook Inc (FB.O), Inc (AMZN.O), Netflix Inc (NFLX.O) and Google parent Alphabet Inc (GOOGL.O).

The BMO REX MicroSectors FANG+ Index 3X Leveraged Exchange Traded Note (ETN) starts trading on Tuesday under the ticker FNGU, the product’s backers said in a note on Monday.

If the target stocks gain 10 percent, the notes should trade up 30 percent.

A companion product, BMO REX MicroSectors FANG+ Index -3X Inverse Leveraged Exchange Traded Notes, which will trade under the ticker FNGD, aims to let investors triple the inverse of the same index.

If FANG and the other stocks fall by 10 percent, the notes would gain 30 percent.

FANG stocks have profited tremendously during the U.S. bull market since the 2007-2009 global financial crisis, and for some investors they have come to symbolize the market’s excesses.

Netflix, the best performer of the four, has gained more than 5,000 percent since the end of 2008.

Apple Inc (AAPL.O), Alibaba Group Holding Ltd (BABA.N), Baidu Inc (BIDU.O), Nvidia Corp (NVDA.O), Tesla Inc (TSLA.O) and Twitter Inc (TWTR.N) round out the other holdings in the index.

A unit of Intercontinental Exchange Inc (ICE.N) developed the index and the notes are also being listed on its NYSE Arca exchange. They did not immediately respond for comment. The note’s issuer, Bank of Montreal (BMO.TO), also did not respond to a request for comment.

ETNs, like debt, constitute a pledge by an issuer. Payouts are based on the performance of the underlying index, but the notes do not actually own those stocks, unlike most of the ETFs to which they are often compared. The stocks are equally weighted regardless of market capitalization.

Reporting by Trevor Hunnicutt; Editing by Lisa Shumaker

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Judge orders U.S. government to seek consent to give data to AT&T, Time Warner

WASHINGTON (Reuters) – The judge hearing the Justice Department’s lawsuit to stop ATT from buying Time Warner ordered the department on Monday to seek permission to give the two companies access to rivals’ pricing data.

Judge Richard Leon, living up to a pledge made during a hearing last week, ordered the Justice Department, which has the data, to ask the companies that gave it to the government for consent to pass it on to ATT and Time Warner’s legal team.

The Justice Department sued in November to stop ATT, the No. 2 U.S. wireless company, from buying Time Warner for $85 billion because of concerns that it could raise prices for rivals and pay-TV subscribers as well as hamper the development of online video. Trial is set for March 19.

Fights over data are common during antitrust trials since companies that are subpoenaed frequently fear that their rivals’ executives will gain access to sensitive internal data that put them at a competitive disadvantage.

ATT is expected to use the data to show that previous mergers did not lead to price increases for content as a way to bolster its argument that this deal also will not lead to higher prices when cable companies seek to buy content.

ATT and Time Warner are seeking data from five programmers, including Walt Disney Co, Twenty-First Century Fox, Viacom Inc, Discovery Communications Inc and Scripps Networks Interactive Inc, according to the judge’s order.

They are also seeking it from distributors Comcast Corp, Charter Communications Inc, Cox Communications Inc and Altice USA Inc, the judge’s order said.

Leon had given access to confidential information to the court, Justice Department lawyers and staff, service providers and ATT and Time Warner’s outside counsel.

Reporting by Diane Bartz; Editing by Susan Thomas

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