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The Week of April 7th to April 13th, 2014 “A Brief Look Back Into Tomorrow”

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The Week of April 7th to April 13th, 2014 “A Brief Look Back Into Tomorrow”






The new week began on Monday, April 7th with investors anxiously watching to see if the previous Friday’s sell-off would be extended into the long overdue correction some talking heads have been predicting, or was just another nervous blip along the way to new intermediate and record highs ahead.




The U.S. based Energy Information Administration (EIA) reported that the advent of shale oil had allowed American imports of crude oil to drop by 10.2% in 2013 to an 18-year low of just 7.6-million barrels-per-day. Interestingly however, imports from Canada increased by 3.9% in 2013 to a record 2.5-million barrels-per-day.




Under the heading of ‘Give Until it Hurts’ – You really know your deal has hit the skids when your major shareholder and joint-venture partner donates their position to charity. Such was the case with Northern Dynasty Minerals (NDM-T) that had to make the best of it when Rio Tinto PLC (RIO-N), a 19.1% owner of Northern Dynasty and former joint venture partner in the giant Pebble copper/gold project in southern Alaska informs Northern that Rio is going to donate their entire Northern Dynasty holding to two Alaskan charities. (And usually, charities tend to turn these donated shares into cash which better serves their purposes.)




Potash Corp. (POT-T) announced that long-time President & CEO Bill Doyle would soon be stepping down as, to be replaced with mining veteran Jochen Tilk as head of the giant potash producer.




Microsoft Corp. (MFST-Q) acted like the giant software company that it is when it announced it would no longer be offering operating or security support for its 12-year old Windows XP operating system.




Contact Exploration (CEX-T), Donnycreek Energy (DCK-T) and Questerre Energy (QEC-T) all saw their share price appreciate considerably on Tuesday, April 8th when the partners reported a better than expected natural gas & condensate levels in a field test for their “02/14-30” horizontal well in the Kakwa-Resthaven area of west central Alberta.




Ford Motor Co. (F-N) reported their Chinese auto sales rose by 28% in March from the same month in 2013 to 103,815 units, and up by 45% in the first quarter from a year ago to 271,321 vehicles.




The Convergence Consulting Group estimates that 25% of Canadian households will no longer have a traditional land-line telephone by the end of 2014, up from the 22.4% who had dropped their landlines by the end of 2013.




With further figures to an improving American economy, the U.S. Labor Department reported that American employers posted a post Great Recession high of 4.2-million new job openings in February.




Long suffering shareholders of Copper Mountain Mining (CUM-T) got some rare good news on Wednesday, April 9th when the southern British Columbian copper miner reported that it had achieved record copper production for the first quarter of 2014.




Market darling Dollarama Inc. (DOL-T) shares’ rose by over 8% to $92.77 when the giant discount retailer beat the street with its 4th quarter financials, but better yet, increased its quarterly dividend by $0.02 to $0.16-a-share.




Canadians were shocked and saddened on Thursday, April 10th to hear of the sudden passing of recently retired Canadian Finance Minister Jim Flaherty, who led the Canadian economy through the Great Recession of 2008-09 and was well received by economic leaders throughout the world for his honesty, sense of humour and those shiny green ties. Closer to home, Mr. Flaherty gave Canadians what is rapidly proving to be their most popular tax saving program ever – the Tax Free Savings Plan.




Units of Argent Energy Trust (AET.UN-T) plunge by almost 23% to $3.61 when the petroleum producer drastically cuts its annual cash distribution from $0.0875 to just $0.02 per unit.




Conversely, the shares’ of Crew Energy (CR-T) rose by over 15.5% to $11.54 when the petroleum developer cashed up by selling some of its Deep Basin assets in the strategic Montney gas play in north eastern British Columbia.




On a related note, calculates that the average Canadian petroleum worker’s wages rose by 6% in 2013 to …..$130,000 per year.




Under the heading of ‘Vive la France’ – The French government, already well known for their 35-hour work week and 6-weeks of summer holidays have now passed a law banning the business use of cell phones…….now wait for it…….after 6:00pm. (One has to wonder how their economy just doesn’t simply implode…).




And Canada’s Mother Corporation, or the CBC/Radio-Canada that was the first to broadcast Hockey Night in Canada way back in the 1950s, announced it will no longer compete for the right to broadcast sports. (The true end of an era).




The markets continued to look for reasons to correct, and they found them again on Friday, April 11th when China reported their exports in March fell by 6.6% while their imports dropped by 11.3% from the same month one year ago.




Canadians enjoyment of the grape continued last year as Statistics Canada reported their purchases of wine rose by 4.9%, while beer sales were down by 0.1% and spirit sales were up by 2.9% for a total increase in 2013 alcohol sales of 2.2% to $21.4-billion.




Thompson Creek Metals (TCM-T) shares’ rose by almost 10% to $3.12 when the miner reported improved first quarter production from its Mt. Milligan copper/gold open pit mine in central British Columbia.




ATCO Ltd. (ACO.X-T) at $54.46, Bank of Montreal (BMO-T) at $75.63 and Husky Energy  (HSE-T) at $35.40 all established new TSX 52-week closing highs during the week, while Argonaut Gold (AR-T) at $4.39, Partners REIT (PAR.UN-T) at $4.52 and Westport Innovations (WPT-T) at $14.27, all fell to new 52-week closing lows.




For the Week – The Dow Industrials fell by 2.35% to 16,027, while the S&P 500 Index lost 2.73% to 1,816 and the NASDAQ Exchange dropped by 3.08% to an even 4,000. Across the border, the TSX Composite Index lost 0.94% to 14,258 and the TSX Venture Exchange fell by 1.79% to 998.




Gold bullion lost 1.16% to US$1,318.30, as copper fell by 1.01% to US$2.98, while crude oil gained 1.13% to US$102.28 and natural gas rose by 4.05% to US$4.62. Overall, the CRB Commodities Index improved by 4.56-points to end the week at a 1¾-year high of 310.09.




The Canadian dollar was flat over the period to end the week unchanged at US$0.9107.




Meanwhile, the closely watched CBOE Volatility Index or ‘VIX’ rose sharply by 3.07% to cross above the warning level of 15 and end the week at a considerably more nervous level of 17.03.




And Finally – A recent Pew Research study finds that the percentage of ‘stay-at-home’ American mothers of young children has risen to 29% as of 2012, up substantially from the record low of 23% that stayed-at-home to raise their young in 1999.




And Finally, FinallyThe Week will be taking a one-week hiatus due to the shortened Easter long weekend. If all go well you should once again find this publication in your inbox somewhere near Monday, April 28th.



Posted April 14, 2014

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