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The silver price began the week on a strong note, rising Monday to a high of $16.22 per ounce. That’s up fairly substantially from Friday’s close of $15.96.
The silver price began the week on a strong note, rising Monday to a high of $16.22 per ounce. That’s up fairly substantially from Friday’s close of $15.96, though it’s a far cry from $16.70, where the white metal was sitting as of June 1.
Looking at what was behind silver’s gain, Reuters states that a number of factors were at play. Those include chart-based buying and a weak US dollar.
However, perhaps the most important price driver was Greece. Talks aimed at preventing a default and a possible exit from the Eurozone for the country recently collapsed, and the news outlet quotes Mike Dragosits, senior commodity strategist at TD Securities in Toronto, as saying that those events are “certainly keeping a floor under precious metals.”
While that’s good news for investors interested in such metals, there’s of course no guarantee that Greece will continue to buoy prices. Indeed, Reuters states that moving forward, attention is likely to shift to a US Federal Reserve meeting scheduled for June 16 to 17 — the hope is that the central bank will indicate the timing of its planned interest rate hike.
“Yellen can now be a bit more optimistic about growth, maybe she will intimate that the path is being prepared for a rate rise (by year-end),” Societe Generale (EPA:GLE) analyst Robin Bhar told the news outlet.
It will be interesting to see how the silver price reacts as the Fed meeting plays out; already at close of day Monday it had fallen back down to $16.03. Meanwhile, the gold price was at $1,185.65 per ounce after reaching a high of $1,189.50 earlier in the day.
Company news
Silver’s price rise wasn’t the only good news in the space on Monday. Here’s a quick look at some positive news released by a couple of companies.
Kootenay Silver (TSXV:KTN) announced results from an expanded ground exploration program at the La Negra diatreme silver discovery at its Mexico-based Promontorio project. The company said that the last three holes were aimed at testing La Negra’s northeastern extension and western end, as well as at testing the diatreme breccia more deeply.
Two out of three of those holes turned out to contain high-grade intercepts, “expanding the extent of the mineralized breccia to the northeast and to depth.” A key highlight is hole LN-40-15, which intercepted 798 g/t silver over 5 meters; that’s within successively wider intervals of 353 g/t silver over 13 meters, 252 g/t silver over 24 meters and 124 g/t silver over 56 meters at a vertical depth of around 300 meters from the mineralized hilltop.
The company’s share price was up 6.33 percent, at $0.42, at close of day.
Endeavour Silver (TSX:EDR,NYSE:EXK) also reported good news on Monday, noting that repairs for the 1,000-tonne-per-day ball mill at its Bolanitos mine were completed earlier than expected. The company originally said that the ball mill, which stopped working on June 5 due to a motor problem, would take two to three weeks to fix.
According to Endeavour, there should be no material impact on production from the mill’s downtime. Explaining what the outage will mean for output, the company simply said that it will have “a minor impact on forecast production in the second quarter of the El Cubo mine.”
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
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