US markets fall during May 2-6 trading week

The Dow Jones Industrial Average fell 162.13 points or 0.49% to 32,899.37 and the S&P 500 fell 32.04 points or 0.77% over the week to 4,123.34. 

Shares of Cameco fell 1.97% to US$23.84 as the company failed to attract additional long-term uranium contracts during the first quarter of this year, beyond the 40 million lb. announced in mid-February. The company said that it had a “significant pipeline of contract discussions underway,” and would prefer to exercise “strategic patience” in its contracting activity as the uranium market undergoes a transition due to increasing demands. The company plans to operate its two tier-one mines, Cigar Lake and the McArthur River, at a combined rate of about 29 million lb. per year or 33% below installed capacity as it closely observes uranium’s market pricing. “Even though we have seen considerable pricing pressure resulting from the geopolitical uncertainty… we will not front-run demand with supply,” the company said in release. Cameco’s adjusted quarterly profit of 4¢ per share was slightly higher than analysts’ forecasts and was based on a strong performance from its uranium and fuel services divisions.  

Coeur Mining shares rose 6.3% to $3.86 as the company’s quarterly results matched analysts’ expectations. The company reported adjusted earnings per share of 5¢, in line with consensus estimates of 4¢. Couer ended the quarter with a US$73 million cash, an increase from about US$57 million in the previous quarter. The precious metals miner produced 2.4 million oz. silver, 2% lower than BMO’s forecast of 2.5 million ounces. Gold production of 75,400 oz. was in line BMO’s forecast of 75,600 ounces. Higher-than-expected production at its Palmarejo mine in Chihuahua, Mexico and Wharf mine in South Dakota, United States (28,900 oz. and 17,800 oz. gold, respectively), was offset by lower production at the Rochester mine in Nevada and the Kensington mine in Alaska (6,100 oz. and 22,600 oz. Gold, respectively). Lower production at Kensington was driven by a decrease in average grade and COVID-19 which led to a rise in absenteeism.  

Shares of Nutrien rose 5.6% to US$103.79 as the company delivered strong quarterly results in response to global supply uncertainties. The company said that it was increasing its potash production as global agriculture and crop input markets are being impacted by “unprecedented” supply disruptions stemming from the Russia-Ukraine conflict. “The situation emphasizes the need for long-term solutions that support a sustainable increase in global crop production,” Nutrien CEO Ken Seitz said in a press release. He said that the company aims to generate higher earnings and cash flows in 2022, which would help expand its fertilizer production capability and enhance its global distribution network. The company reported record net earnings of about US$1.4 billion in the first quarter compared to about US$133 million in the same quarter last year due to higher realized prices and strong retail performance.