Central bank strategies and concerns over trade disputes overshadowed a week that saw a historic meeting between U.S. President Donald Trump and North Korean leader Kim Jong-un.
The two gathered in Singapore on June 12 in for talks around Pyongyang's nuclear program.
On a global level, concerns over a trade war rose further after the U.S. imposed new tariffs on US$50 billion of Chinese imports.
The move followed a previous round of tariffs that targeted steel and aluminum from abroad, including imports from Canada, Europe and Mexico. It led to a tensed G7 summit in Quebec before escalating in a war of words after Trump pulled out of a joint communique that had sought to overcome disagreements, notably over trade.
On June 14, European Union diplomats supported retaliatory action for €2.8 billion worth of U.S. imports, paving the way for the European Commission to impose 25% tariffs against a number of U.S. products.
Meanwhile, remarks by Federal Reserve officials indicated a growing likelihood of two more interest rate hikes this year, prompting the dollar to move modestly higher.
The European Central Bank announced that it will keep interest rates at record lows for a long time but said it will end its three-year bond-buying program in December.
Metals across the board had a dull performance last week, and the bulk sector was the only one holding up.
On a weekly basis, iron ore accelerated modestly by 1.2% to a level of US$63.0/t on June 15.
Metals in the base and precious sector all ended the week in the red with losses of between 0.2% and 2.2%.
Copper took the biggest hit among the base metals, closing at US$7,173/t on June 15, 2.1% lower than the previous week. Though, copper is still trading around 27% higher than 12 months ago.
Aluminum, zinc and lead only booked marginal declines of between 0.2% and 0.4%, while nickel retracted close to 1% to US$15,211/t.
Gold and silver lost 1.6% and 1.2%, respectively, to US$1,278/oz and US$16.6/oz.
The current environment presents the right time for more M&A activity in the African gold space if companies want to grow or transform their status while there is no gold price volatility, RFC Ambrian said in a new note.
"The urge to merge is a current theme of company strategy and this will be reflected in M&A activity over the coming years as companies look to attract the attention of the pools of capital that remain interested in the sector, which appear to have become more and more concentrated," the team said in the June 18 report.
"Times change, however, and we suspect that the gold price volatility will increase over the coming years and that this will result in a change of shareholder demands, in response to which company strategy and M&A activity will continue to adapt."
Assessing the deal activity and strategic positioning of players in Africa's gold sector, excluding South Africa, RFC Ambrian identified Acacia Mining PLC, Avesoro Resources Inc. and Perseus Mining Ltd. as potential candidates for merger or demerger activity.
While the analysts flagged that such deal was not immediately on the horizon, they noted that the pursuit of scale could be a crucial driver for such a move.
Scale was also seen as the relevant catalyst for asset acquisitions by global gold companies with operations in Africa.
The vast majority of M&A deals are expected to materialize among single African gold producers.
"Many of these companies have ambitious plans to grow their businesses in order to diversify their asset base and to increase their scale in the pursuit of an increased market presence that could bring higher ratings and improved access to capital," RFC Ambrian elaborated. "This could result from project acquisitions, or just as likely from a transformative merger."
Most likely names referenced in this context were Centamin PLC, Asanko Gold Inc., Resolute Mining Ltd., Roxgold Inc. as well as Toro Gold and Teranga Gold Corp.
In the context of acquisitions, Semafo Inc. and Avesoro Resources Inc. were tipped the most likely players getting active. However, the analysts highlighted that Randgold Resources Ltd., B2Gold Corp. and Endeavour Mining Corp. could also be on the lookout for assets.
"Each of these companies is ambitious and could be an acquirer of African assets, although they are not under any immediate pressure to do so," RFC Ambrian noted.
Larger financing deals last week included a €150 million bond issue by Swiss steelmaker Schmolz + Bickenbach AG, which seeks to repay outstanding debt. The 5.625% senior secured notes are being offered with a 2022 maturity date.
Altech Chemicals Ltd. secured a US$60 million stream finance facility for its Johor Bahru high-purity alumina project in Malaysia. The deal with a U.S.-based global alternative investment group will take the total project finance to US$340 million.
Bradespar SA received board approval for the issuance of nonconvertible debenture securities worth up to 700.0 million Brazilian reais. The three-year notes, worth 10,000 reais each, will be issued June 28 in a single series and mature June 28, 2021.
Petra Diamonds Ltd. received broad shareholder support for a US$170 million rights issue to strengthen its balance sheet. In a special general meeting, 99% of shareholders voted in favor of the move.