By Heather Matthews – Exclusive to Lead Investing News
Current market climate
Shockwaves are running through global commodities markets as America faces one of its worst stock market crash since the Great Depression.
The American housing market crisis has left many firms unprotected and over-leveraged: the bankruptcy of global investment bank Lehman Brothers has created a sharp market downturn as investors fear more decreases in their stock values in the coming days.
The failure of Lehman is not an isolated incident: many firms who invested heavily in the housing market are suffering. The Bank of America is buying troubled investment firm Merrill Lynch, and AIG is seeking financial rescue from the Federal Reserve. All three companies were involved in the housing market, and showed robust profits before the housing crash began. Companies with less at stake in the housing market will fare better in this difficult stock market climate. Firms like Goldman Sachs are reporting modest profit projections, since they were not reliant on the housing market.
Even U.S. President George Bush has stepped forward to comment on the crisis, “”We are working to reduce disruptions and minimize the impact of these financial market developments on the broader economy.
“In the short run, adjustments in the financial markets can be painful,” he said. “In the long run, I am confident that our capital markets are flexible and resilient, and can deal with these adjustments.”
The impact of these grave developments will be felt across the board, and zinc metal and lead metal spot prices are already dropping as a result. Throughout this year, zinc has been oversold, showing a strong position only in China, where business and production boomed due to the buildup to the 2008 summer Olympics in Beijing. Although a weaker American dollar makes U.S. commodities more attractive in foreign markets, it may not be enough to offset the weaker spot prices as investors sell off their stock and convert their holdings to safer futures.
As of September 15, 2008, stock market spot prices for lead (New York exchange) are as follows: bid/ask of .8284 to .8352, down 4.10 per cent over 24 hours. Zinc prices are currently ranging from .7874 to .7965, down 6.26 per cent over 24 hours: these large decreases can be directly correlated to the fall of Lehman and other worrisome developments.
Canadian business news for lead and zinc
Blue Note Mining (TSX:BN) - Blue Note’s stock holds steady at .04 cents per share, as of September 15, 2008. Blue Note has some positive projections for the coming months despite a troubled commodities market, and expects to continue an aggressive pattern of lead and zinc recovery from its mines in the future. However, Blue Note’s stock has plummeted from a year high of 42 cents a share.
Teck Cominco (TCKb:TO) – Analysts are advising shareholder to hang on to their Teck Cominco stock for the moment, as prices decrease. The current bid price for this stock is 37.83, a 3.02 per cent decrease from yesterday’s closing bid price of 39.01. Due to the strong diversification of this mining company, it can be expected to rebound from current market conditions, and it considered one of North America’s strongest mining businesses.
Bard Ventures Inc. (TSX:CA:CBS) Bard Ventures Inc. operates the Wasi lead mining project out of MacKenzie, British Columbia. It also holds many mineral claims on the Lone Pine mining area north of Houston, B.C. Bard is currently showing strong stock quotes on the TSX, with a September 15, 2008, price of 10 cents a share, up a percentage of 17.65 from yesterday’s closing price.
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