By Angela Harmantas
Did Canada fall into a technical recession over the past two quarters? We’ll find out today when Statistics Canada releases key GDP figures for June. Today on SmallCapPower we give you a list of junior companies who may thrive during a recession. Also, we discuss the strategic importance of one Chinese company’s investment into the world’s largest gold producer, and look at an acquisition in a space that hasn’t been feeling the love – here’s what you need to know today:
Most experts are expecting an official confirmation that the country is experiencing a recession, so there’s unlikely to be any nasty surprises as Statistics Canada releases updated GDP figures. According to a recent survey, economists are expecting a growth of 1.1 percent, which is less than the federal government’s projection of 2 percent back in April. Regardless of the figures, our team has compiled a list of 5 juniors that could weather the recession on account of their substantial growth despite a contracting Canadian economy. Keep an eye on SmallCapPower today, as we’ll post the figures once they become available.
There were a couple of interesting deals taking place over in the mining world on Monday. The biggest headline: China’s Zijin Mining Group handed Barrick Gold a $298 million cash injection that Barrick said would go towards reducing the company’s debt by the end of the year. The deal is essentially a completion of the first phase of a strategic partnership agreement between Barrick and Zijin that sees the Chinese miner acquire 50 percent of subsidiary Barrick (Niugini) Ltd., which owns the Porgera mine in Papua New Guinea. Zijin plans to collaborate with Barrick on future projects, so it’ll be interesting to track the operations at Porgera as they could have real implications for Zijin’s upcoming moves. Also making news: Argentina-focused junior Argentex Mining agreed to be acquired by Australia’s Austral Gold in a C$5.8 million deal, or around C$0.08 per share. It’s a silver play, which hasn’t been experiencing much love lately, but Austral wanted a stronger foothold in South America and Argentex’s shares soared 120% higher on the back of the news.
We’ve got more expert interviews coming up for you in the next couple of week! Next week I’ll be speaking with Peter Hodson, CEO of 5i Research Inc., a former director of Sprott Inc. and a frequent guest columnist in the Financial Post and commentator on BNN. I’m looking forward to speaking with Peter about last week’s market turbulence and hear his tips on small cap investing. As always, if you have any questions for him, don’t hesitate to send them my way and we can get the answer for you.
Do you have a burning question you’d like answered by an investment expert or analyst? Let me know and I can post the answer here in the blog. Contact me by email at angela@smallcappower.com or on Twitter: @aharmantas.
