Daily Brief Energy/Materials: Crude Oil, iShares MSCI Brazil Capped ETF, Pan African Resources and more

• Virtual OPEC+ meeting was held on 30th November after being delayed by five days. Outcome was an increase and extension of supply cuts till Q1 2024.
• WTI rallied 2.5% heading into the meeting but fell 4% shortly after due to scepticism over members following through on cuts and short-term nature of agreement.
• OPEC+ announced that Brazil would join the coalition in early 2024. A move that unites most top crude oil producers in the cartel with major geopolitical ramifications.

• In our October 26, 2023 Int’l Compass we discussed our expectations for a bounce in global equities (MSCI ACWI). So far, that has been the low.
• Then, in our November 2, 2023 report, we discussed the bullish implications of the false breakdown in MSCI ACWI (local currency), before discussing expectations for a year-end rally on Nov.16
• We see a massive opportunity in global gold/silver miners with gold nearing multi-year breakout. Also buy opportunities: Utilities in Europe, UK, and India; Materials, Industrials, Transportation, Real Estate, and Technology

On 22 November, Pan African Resources (PAF) announced that operations to date in FY24 had performed in line with, or better than, expected, with gold production for H124 anticipated to be in the range 94,000–98,000oz (cf 92,307oz in H123). As a result, it increased its production guidance for FY24 to 180,000–190,000oz, which caused us to increase our production estimate in turn by 1.9% (or 3,575oz) to 189,725oz. The change made only a modest difference to our EPS forecasts for FY24 (see Exhibit 2). However, it increases our confidence in those estimates, which are already at the top of a relatively wide range of expectations.