Far East Capital Newsletter
Celsius Resources buoyed by huge intercept of 611m at 1.39% Cu plus 0.75 gpt Au
30 Jul 2022

In This Issue

Celsius Resources buoyed by huge intercept of 611m at 1.39% Cu plus 0.75 gpt Au

So we have had two news events last week that on any other day might have caused share prices to go down; higher interest rates and recessions. I suppose we can attribute this reaction to the market looking ahead to see what is over the horizon. Investors are allowing themselves to be more optimistic than they were three months ago. Again, markets move on expectation and emotion, often more so than on actual news.

We have had the market collapse in recents months due to the fear of interest rate rises and inflation, so the selling has already happened. We are now seeing bargain hunting that is lifting stocks off their lows. Steep downtrends are being broken and there are green shoots of optimism suggesting that we have seen the worst. Whether or not this is sustainable depends on how much money comes back into the market, but it is looking decidedly more positive for the time being.

We have mentioned Celsius a few times over the last 18 months, viewing it as one of the least appreciated of the large copper porphyry exploration/development stocks. The market seemed more interested in the earlier stage, higher risk explorers in Colombia and Ecuador, such as Los Cerros and Sunstone Metals, notwithstanding these being at least a year or two further away from development than Celsius's MCB Project in the Philippines.

The recent infill drilling program is providing evidence of a higher grade zone that could materially boost grade and profitability in the first 10 years of an operation. Hole 38, with an intercept of 611m at 1.39% Cu and 0.75 gpt Au, has been instrumental in forming this perception. 

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