David Morgan Talks Gold, Liontown Rejects Albemarle

Gold has cooled after market turmoil allowed it to interrupt US$2,000 per ounce not as soon as final week, however twice. Though the steel neared that degree this week, it was slightly below US$1,970 on the time of this writing on Friday (March 31).

Previous to final week, gold had solely handed US$2,000 a few instances previously — first in July 2020 amid international COVID-19 pressures, and subsequent in February 2022 on the again of Russia’s invasion of Ukraine.

Now market watchers understandably need to know what’s subsequent for the yellow steel, and I requested David Morgan of the Morgan Report to share his ideas. He mentioned if gold is ready to hit a brand new excessive it might take off operating.

“When you get to the brand new excessive, we’ll name it US$2,060, then the algorithms kick in,” he mentioned. “The algorithms know the momentum play is everytime you make a brand new excessive there is no upward resistance. So even just a little bit of shopping for will drive it larger. And while you get one other new excessive, then everybody says, ‘Oh, gold’s on a run. How far will it go?’ And there is no promoting — I am exaggerating barely, however there’s not that a lot promoting. And so then just a little bit extra shopping for or a variety of shopping for will take it even larger.”

Lithium M&A in focus as Liontown shuts down Albemarle

Gold M&A has acquired a variety of consideration recently, however this week introduced a serious transfer in lithium. Liontown Assets (ASX:LTR,OTC Pink:LINRF) mentioned on Monday (March 27) that it has rejected an indicative proposal from Albemarle (NYSE:ALB).

Based on Liontown, main producer Albemarle needed to amass the entire firm’s shares at a worth of AU$2.50 every. Liontown believes this quantity is a considerable undervaluation, though it does are available above Albemarle’s earlier two affords of AU$2.35 per share on March 3 of this 12 months and AU$2.20 per share on October 20 of final 12 months.

Explaining its stance, Liontown calls Albemarle’s method “opportunistic” given the latest softness in corporations uncovered to the lithium sector. The corporate additionally highlights ongoing exercise at its flagship Kathleen Valley challenge in Western Australia, saying that the asset is being de-risked as mining operations begin up and development continues on schedule.

“In coming to its determination, the Liontown Board famous the opportunistic timing of Albemarle’s Indicative Proposal, coinciding with latest softness in corporations uncovered to the lithium sector and the pre-production standing of the Kathleen Valley Challenge” — Liontown Assets

Albemarle’s bid quantities to US$3.7 billion, and the truth that Liontown shot it down has sparked commentary on precisely how a lot massive producers might must pay in the event that they need to add superior properties to their portfolios — Kathleen Valley is ready to ship its first output in mid-2024. We’ll be watching carefully to see how the story develops, so keep tuned for extra updates.

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Securities Disclosure: I, Charlotte McLeod, maintain no direct funding curiosity in any firm talked about on this article.

Editorial Disclosure: The Investing Information Community doesn’t assure the accuracy or thoroughness of the knowledge reported within the interviews it conducts. The opinions expressed in these interviews don’t mirror the opinions of the Investing Information Community and don’t represent funding recommendation. All readers are inspired to carry out their very own due diligence.

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