Anglo Asian Mining Share Discussion Threads

[mattjos] 17/6/2016 16:41

buying already starting to eat into that 15p stock offered in the auction. Wont take long for this tranche of stock to be gobbled up in the move towards 20p.

This must have popped up on the screen of some institutional investors by now, given its move through £10m mkt cap and the gold environment

[celeritas] 17/6/2016 15:33

I don't understand this gold holding up well lark. What pressure is it under?

Currently it's 1294. I don't think people have yet realised aaz is yet to recover the Bashirov episode. New posters wont even be aware of him causing the price destruction. The mm's will slowly in my opinion wind this back up to the 20s but they'll want a cut in the mean time, hence the gyrations.

[jbe81] 17/6/2016 15:03

Gold holding up well, surprised there is not more buying, got a few more this morning.

[mattjos] 17/6/2016 13:34

zhockey .. the saving of 8.5p / share is approx. equal to the raise in the share price over last few weeks. That saving has been well known to everyone since last year!
Nothing in the rise as yet to reflect the higher price of gold, the reduced cost of production, the increase in production etc etc.

The order book has been loaded this last few auctions with 653k to sell. The seller is indicating that he'll sell in 100k chunks from 15 thru 20p. A small holding that should provide the necessary liquidity for the MM's as the rise goes on to 20p & will get snapped up quick enough

[jbe81] 17/6/2016 12:34

Should be 25++p already

[zhockey] 17/6/2016 12:21

That's £9m added to the ent value or about 8.5p/share!

[celeritas] 17/6/2016 11:53

Don't forget aaz will save approx $13m in operating costs this year due to the Manat being devalued.
AZN currently 1.52
$13 is based on 1.5

[zhockey] 17/6/2016 10:23

2Sporrans,

Nice post, I think we are almost guarenteed stagflation as governments need to inflate away debt and there is simply not enough demand side growth in the next decade. Japan is in this state but without the inflation, at some point they are going to have to take drastic action to devalue the yen.

In this sceanario I don't see a rosy outlook for equities as rising commodity prices will squeeze margins and higher rates will reduce debt driven buy-backs. Consumer spending will be interesting, I guess that depends on whether wage growth is part of the inflation profile, I think it prob has to be.

How do you see the inflation/deflation landscape playing out?

[mattjos] 17/6/2016 09:42

Was out all of yesterday and now caught up.The reported production for May was slightly better than I had expected and there is still the output from the flotation to factor in (not yet reported).By now, the heaps should all be at their optimum summer temperatures and so I am expecting the June figures, reported in mid-July to be the first time we see what AAZ can really do.The reported silver output was terrific!Quite happy to see gold consolidate just below $1,300 prior to the vote next week. If, as I hope for the sake of the uk, we vote out then, I can't see what is going to keep gold from heading towards $1,400 ... Just as we hit maximum levels of production.Meanwhile, the AIMROC assets will not be left on a shelf ... The govt will want them re-allocated and productive ASAP - Chovdar being the very obvious one. Exciting times just ahead

[golla] 17/6/2016 08:58

stock is very tight again.

[jbe81] 17/6/2016 08:47

not all trades showing up here

[celeritas] 17/6/2016 08:18

Weak pog. Its at 1283, I'd say that was super healthy for aaz. It has yet to catch up with 1200.

[jeanesy] 17/6/2016 08:06

Weak POG means a down day today with some profit taking being very likely . This may continue until we get H1 figures and news about debt

[2sporrans] 17/6/2016 00:42

zhockey

The reason why Government bonds are being bought is something ancillary to the thrust of my previous post.
The yields are fallen, regardless of why they are being bought.

In any case, I imagine that in the case of Government Bonds and especially in Europe and Japan that it's very much a case of Central banks buying [to stimulate lending] rather than other institutions, hedgies or whatever.
Accepted, the latter probably are buying with capital gains in mind.
Pension funds have to keep buying regardless. Apart from anything else they'll simply be matching their annuity liabilities and the pensioners that are suckered into buying annuities take the hit.
Ain't it much the same game with bank mortgage lending - esp. like in the USA where banks issue long term debt at a tad over Treasury rates and mark up on their 25, 30 year home loans? So banks want rates to rise and big up their margins.
Seeing we are contemplating a knock-on and knock-down blow to the EU stable virtue of a bolting UK horse, I'd guess that a growing number of the latter buyers of Bundesbunds or Swissies will be doing so to benefit from a return to national currencies if the Eurozone fragments.
Yeah, guess the prospect of Bundesbunds in Deutschmarks could be bracketed under [potential] capital gains too.

Regards the corporate bond market:
Now here, I think investors probably are hunting capital gains in force.
I was until very recently.
Spreads could yet concertina a fair bit more if default risk perceptions remain sanguine; moreso if improve e.g. oil/gas company recovery play.

Who really knows what's going to happen when rates rise.
One can safely say bond prices will fall; its a tautology.
As for other asset classes, depends on what has lead to the rates rising; also how much, over long will rates rise.
Will base rates /AAA yields have to rise even close to 50 year averages to suppress excess growth and restore overcapacity in developed economies?

Even modest growth scenarios, combined with timid-trickle up in rates may support real assets, equities included. See case for banks [lending margins] above as case in point.
Sure, if there is stagflation, looks bad for shares generally as well as property, commodities .....real assets generally.
Property could be nasty as illiquid.

Index linked bonds should be the best risk v reward asset class play approaching/during stagflation....other than this weird and I think unprecedented situation where they have been bought en-mass artificially.
In a classic downcycle situation [a la 1970s], the linkers would have been shunned prior to a descent into stagflation from either modest growth/low inflation or [moreso] high growth/high inflation [NOT where we are at/going].

Seems to me you are putting across an "only game in town" case for precious metals [and miners].
And you may well be right.
Might pan out this way, for maybe even a few years.
Plenty of fear and uncertainty to come.

My simplistic way of looking at it is that, due to sustained, extreme monetary policies [that are only suitable for liquidity support but massively over employed due to [fiscal] debt lock-down], we have experienced artificial inflation across ALL asset classes.
When all boats rise on the same tide, they will sink together as it ebbs out.
Eventually, this will come to pass.

Taking a long view vis your stagflationary prognosis though, if you hold a stash of equities that pay out high dividends [with good cover] and IF these continue to do over, say a stagflationary decade or more, then at the end of it, you will be very likely be sitting pretty regardless of how far prices fall in the interim.
Of course, much better to have cashed out and bought [back] cheap .... if you are lucky/smart enough to pull off.

Think this missive is overextending its conceivable welcome; so endeth.

[wrighty46] 17/6/2016 00:06

Matt I haven't got L2 anymore, and I don't have 653k(would be nice though) what price did they put on them if you don't mind me asking if that is indeed the case?

[ilostthelot] 16/6/2016 23:02

Happy days 30p here we come ,this year..hold on tight. If gold goes over 2000 then £5 per share easy. Imo.

[mattjos] 16/6/2016 21:14

They certainly clubbed gold back after European markets closed.Any attempt to delay the vote will surely be interpreted as further desperation by the Remain camp & likely swing even more to Leave.Very interesting order book in the intra-day and closing auction here today.Who has got 653k and they made a clear signal

[zhockey] 16/6/2016 21:10

With regards to AAZ, in the absence of news I think we'll see a 12 on the bid tomorrow.

[zhockey] 16/6/2016 21:07

@2Sporrans,

What I believe you are missing is that bonds are being bought for capital gain as opposed to income. This is what is driving in stocks IMO, i.e. the search for income via dividends, and ditto real estate.

This is the inverse of the "old normal". What will be interesting is where capital flows when rates rise, IMO bonds will sell off due to capital loss, stocks will sell off as 2% div yield will not be attractive, ditto real estate. So where does the capital flow if not to bonds, equities or real estate? Well I think the reason for rates to rise, the only reason, will be inflation, what is the age old inflation hedge? Also I would expect this to be stagflation a la 1970's.

However until we see inflation we are stuck in this "new normal". Perhaps the rise in gold this year is the early stage of this, some big names pre-empting? It certainly doesn't feel like gold is going back to $1050, but who knows??

[zhockey] 16/6/2016 20:55

@Brasso,

Yes I thought gold would drop on the FED news but it went the other way to test the top of the downtrend. Today I thought gold was being held to close on that trend line but it briefly broke out before the dramatic market reversal. I see that is being put down to the shooting and possible brexit postponement, I doubt that is driving global markets, more like the market is equalising.

Gold has gone nearly up every day since the bounce off 1200, a pull back was inevitable in my view. Let's hope that it will bounce off somewhere near 1250 and make a robust move well into the 1300's

[philo124] 16/6/2016 20:45

And Greece.

[mattjos] 16/6/2016 20:27

I imagine that if we vote to leave, the summer wobble will be all about whether or not Europe actually hangs together without us & what is the ripple effect.I believe that our leaving will simply be the first domino.... Denmark, Netherlands, Poland .. These could be next to decide to leave.European banks and sovereign debts will likely more of an issue. DB looks particularly vulnerable right now.

[philo124] 16/6/2016 20:12

High volume.

[philo124] 16/6/2016 20:09

Next summer wobble after brexit will be china.