Anglo American shrinks trading unit as part of major restructuring
The miner also announced internally that it will no longer enter into long-term deals to buy commodities that it doesn’t already produce.
Tuesday morning precious metals benefited from the announcement that the Greek government is accepting the terms of a second bailout. The euro also gained support and the EUR/USD index gained 1.02% , quoted at 1.3256 at noon EST.
As a result, in early morning trading, gold bounced $30.30 to $1740.30/oz and silver followed suit by climbing to $34.02/oz from lows of $33.20/oz (+2.46%) both at noon NY time.
Copper prices were hovering at about $3.8514/lb, about the same as yesterday at noon. Yesterday’s LME warehouse copper inventories were reported being down 0.90%. Standard Bank’s commodity division said that global copper consumption is expected to grow by 1.2%.
Dow Jones was in positive territory, shooting up 31.78 points (+0.25%). Toronto Stock Exchange indices recovered from earlier losses and at noon (EST) the S&P/TSX Composite Index was at 12,526.50, down 33.53 points or -0.27%.
Headline news on the market was that mining group Xstrata (LSE: XTA.L) and Glencore reached an agreement for an all-share merger. Some shareholders oppose the move as Xstrata increased its 2011 profit by 20% and they consider that the Glencore offer undervalues their shares. The market reacted and Xstrata stock was down 4.88% (-61.50) at noon.
NovaGold Resources (AMEX: NG) announced that it has closed its US$332.5 million bought deal equity offering and it seems that the market got over its uneasy feelings over the dilution and reacted cautiously but positively ($9.05 +1.47%) on the news.
Yesterday, Rubicon Minerals Corp. (TSX: RMX) announced a $200 million bought deal financing with the proceeds to be used to advance their Phoenix gold project located in Ontario, Canada. As usual the market reacted by downgrading their stock (- 2.45% to $3.98).
Tanzanian Royalty Exploration Corporation (TSX: TNX) reported high grade assay drill results at its Buckreef Gold Project in the Lake Victoria Goldfields of Tanzania. The stock was up 5.20% on light volume.
Nevsun Resources Ltd (TSX: NSU) was downgraded by investors ($ 4.4610 -29.64%) because of an announcement that they made this morning where they admitted to over-estimating gold content in their main pit resource at Bisha, Eritreea.
Vale’s stock (NYSE: VALE) fell 0.53% as a result of the Guinea government’s announcement that they would investigate the way that Vale acquired their Simandou iron ore licence and the fact that a sanction may include Vale losing its licence.
At the same time all Vale’s workers are back at their five Sudbury mines that had been temporarily closed pending an investigation into the death of an underground miner.
A 17% to 18% pay rise was awarded to Zambian copper miners by Barrick, Glencore, Konkola Copper Mines (Vedanta Resources) and ChinaNonferrous Metals Mining.
