Plenty of news flow from the juniors last week

Plenty of news flow from the juniors last week

We have had a great surge in the market following the extreme lows caused by the virus panic, but is this giving us a false sense of optimism? Where to now? Will the market keep rising without having a pause?

We are back in the position of trying to figure out what all the virus stuff means. It will take a while for us to get a clear view and decide who will be the winners and losers. While there is a general feeling that you can’t go wrong with gold, what about the metals that require economic activity?

The strength of the iron ore price is somewhat anomalous if you consider that lower growth should mean less demand for steel. Something doesn’t add up here, especially if you consider that the Pilbara mines are not in danger of being locked down. It has been suggested that production from Chinese mines has been interrupted by the virus, so the Chinese have to turn to Australia to fill the gap. Maybe.

There isn’t any real sense in being optimistic about a rapid economic recovery, but neither is there a need to be too depressed. Share prices will react as news filters through about specific industries and companies, while exploration activity will provide some excitement when results come through. There has been plenty of news flow over the last week, and that is an essential ingredient to make share prices move.