Although the small caps space has generally been buoyant since the start of the pandemic, the sector which missed out was certainly oil & gas. The plus point since the COVID-19 vaccines were announced earlier this month has been the way oilers of all shapes and sizes have rallied hard.
Indeed, until now one of the notable exceptions to the rebound was i3 Energy (I3E). But finally, the stock played catch up with an 8% gain to 5.2p, perhaps overdue after this month’s operational update. Highlights here included group production from Gain Energy and Toscana Energy Income assets during October averaging 9,407 boepd, and a first dividend expected to be declared and paid in Q1 2021. WH Ireland’s recently unveiled preliminary valuation for the stock is 17.7p based on 2P reserve estimates.
Tech investor Pires (PIRI) was back on form with a 16% rise. This was after traders pointed to its recent pullback being overdone and noted strong volume on the rise and large orders. They also suggested that after the exit of investor Chris Akers from Trafalgar (TRAF), Pires, in which he has 18% stake, could receive more love and attention. The last significant news from Pires was relation to investee companies Sure Valley Ventures and its holding in VR Education Holdings (VRE).
One of the better stock market rules is that it pays to keep an eye on the long side of companies whose shares rise after a placing. While it was only 1.5% on the up for Empire Metals (EEE), the copper and gold development and exploration group raised £2m in order to buy 75% of the Eclipse Gold Project in Australia. Empire said the funds would be used to drill and develop the project.
Sticking in the mining exploration area, and it was Galileo Resources (GLR) which was back in the news. The company announced that it had signed a marketing agreement with Zopco in relation to the potential sale of zinc willemite ore from the group’s 95% owned Star Zinc project in Zambia. Galileo said that the current strong price environment for zinc means that the deal improves the company’s options regarding the asset.
As is sometimes the case, there was some head scratching associated with the sharp 47% share price rise for central Asian oil and gas explorer Caspian Sunrise (CASP). While the obvious explanation was and is that there is a squeeze beginning in even the most obscure of oil & gas plays, traders said the absence of a “speeding ticket” RNS suggested that there was a news leak. However, it is still most likely that the general turnaround in oilers has also stretched towards Caspian, especially given that according to last month’s RNS we are in the run up to the acquisition of the Caspian Explorer.
Finally, it appeared that after days on the back foot we were finally witnessing the end of the recent retracement in COVID-19 plays. For instance, Omega Diagnostics (ODX) bear trapped back up 7%, not surprising given social media estimates of £20m earnings per month on COVID-19 tests.
By contrast, biotech group Tiziana (TILS) managed to bounce at 80p after a decline from 300p, as some in the market noted that COVID-19 exposure is only 15% of its portfolio. In addition, there was a positive read across to the company from Provention Bio (Nasdaq:PRVB) where its non toxic monoclonal antibody is similar to Tiziana’s. The difference being that Tiziana’s Foramulab drug is the only fully human anti CD-3 monoclonal antibody.
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