Greg Barnes – 07/07/2022

[theme music] >>hello, I'm Greg Bonnell. Welcome to MoneyTalk Live, brought to you by TD Direct Investing. It's a new program broadcast daily on WebBroker. Every day, I will be joined by guests from across TD, many of whom you will only see here. We will take you through its moving the markets and answer your questions about investing. Coming up on today show, we are going to look at how the mining industry is position for a possible slowdown in growth with the Greg Barnes from TD Securities. On today's WebBroker education segment, we will have a look at how you can research specific stock sectors with Caitlin Cormier. Here's how you can get in touch with us with your questions. Email moneytalklive@td.com or fill out the viewer response box right under the video player here on WebBroker. Before we get to our guest of the day, let's get you an update on the markets. We bought some green on the screen on Bay Street and Wall Street. If you're on the market, it's probably a welcome sight. It let's start at home with the TSX Composite Index Index with 1 1/2, almost 300 points to the upside. Crescent Point one of the names making gains today. The energy sector overall is doing well. Crescent is talking about rewarding shareholders. We will tell you more about that in a couple more minutes, but the market like the news at nine bucks and $0.42 a share, up 13% here let's check out one of the mining names as well. We have seen pressure in energy and material stocks in the past couple of sections but Kinross Gold today, $4.35, I'm not sure that showing you what I expected so we will move on to the S&P 500, the broader read of the American market. Right now, 3890, a gain of almost 45 points, more than a full percent. It appears right now, and this is volatile stuff in terms of trying to figure out where eventually the central banks will land on their rate hikes, the market is starting to pull back some of their expectations of how far they need to go. Not saying they are not going to continue to raise rates, that's baked in right now to the market forecast, but eventually where will they end up? Perhaps not as high a point as we feared only a couple weeks ago. That's been volatile, so we will look at that from day-to-day. The NASDAQ 100, a little bit stronger than the other market, up hundred and 84 points. Freeport-McMoRan, those shares have been buffeted and bounced around lately, making gains today. That's your market update. The value of many base metals hit record highs in the spring but with those recession figures increasingly on the mind of investors, the price of copper, nickel and other metals have tumbled along with the mining stocks. Our featured guest today says the industry is in good shape heading into a possible slowdown. Some firms will be better position than others. Joining us now is Greg Barnes, managing director at TD Securities. Great to have you. Want to start with that boom that we've seen in the last several months. Has faith been shaken recently? What's going on? >> Your comment about volatility is very apt. These stocks are bouncing around like crazy. This is normally what we see when people get worried about global growth and whether their role or will not be a recession, what the Fed will do, it's not unusual for these stocks act like this. demand driven by a transition to a low carbon world. The long-term thesis remain strong. over the mid to mediumterm, we have to worry about growth. That's normal cyclicality that we see in the mining sector. It's not something we haven't seen before. We will see it again. >> Unfortunately, we are getting used to volatility and bumpy rides to get to where we need to go. What can mining companies do you in an environment like this? eeven those who believe in our recession and think it's going to be short or mild. What to the companies have to do in a time like this? >> I think the mining companies have set themselves up well over the past several years and we have had strong metal prices and Dave bolstered the balance sheets, generating a lot of free cash flow, repaying debt, returning capital to shareholders. When I look at Canadian names, I don't see anyone who's got a real problem on their balance sheets or a problem with liquidity. They are all well position. But what they will do is if we go further into a slowdown and say we have a hard landing, they will reduce X. They will delay projects. A lot of them have put in place-based dividend at a performance dividend if they are doing well financially and they will probably reduce the performance dividends. Not the base dividend, but the performance dividend will be reduced. Overall, they are in good shape. They have leavers they can pull to offset low metal prices and again, I don't see anyone who got a particular problem on their hands from a balance sheet point of view. That's different from past cycles. If you think of 2008 and nine, there were companies in dire financial straits. They had to pull every lever they had to avoid bankruptcy. We are not in that kind of situation. >> Is good to hear we are in a better situation this time around after the financial carnage of 2008, 2009. You mentioned that they might have to pull back on capital expenditures. What does that do for that on the road? He said longer term, the world is hungry for what these companies are taking out of the Graham but if they have to go through a period of not investing as much, does that set up an imbalance later on? >> It Absolutely does. if projects get delayed…that adds a year or two to when they can finish building the mine and that pushes or extends the period of supply tightness that we are already expecting post 2024. So I think if you are looking at metal prices and you are bullish on the long term, that should underscore this bullishness because we will not get the supply response that we are expecting, the delay will be longer. We need more copper and nickel. A severe slowdown in 2023 or 2024 will push that supply response out even further. > We take a look at the materials basket, the mining stocks, but they are not all the same, clearly. If we entered a period of slower economic growth or period of contraction, are some points of the mining space better positioned than others? >> They are all in the same boat. When commodity prices come down, they'll come down at the same time, whether it's copper, nickel and zinc. In gold, summer sessions it goes up or down. Depending on what inflation, the Fed, interest rates and exchange rates are doing. It's harder to call what gold will do. Gold metal companies like the base metal companies are good on the balance sheet perspective. It could do well in a recession but the flip of the coin. >> I thought I understood gold at some point in my career. In a very 10,000 foot way, you know, in times of turmoil, here is a haven asset. In recent years, it has tested my understanding of it. What's going on with gold? >> I will point out, were a lot of commodities are down sharply this year, copper down 10, 15, in percentage terms, gold is effectively flat. Gold has acted as a safe haven during 2022 when we've seen a lot of things, the S&P was down 20% just recently over the past six months. And gold has held flat. Bitcoin is down 70% from the peak. So gold has been a safe haven, it has on what it was supposed to do. You mentioned the beginning in your introduction that there is some concern met now and there is concern that the Fed will not go so far in raising rates. That is pressuring gold. It's a very difficult call on what gold's going to be. >> You mentioned inflation briefly in relation to the price of gold but what about for the mining sector and mining companies? We've heard so many companies and corporate leaders come out and talk about how tough it is in this environment, supply chain disruptions, soaring inflation, what does that do to the mining industry? >> Inflation is a real issue. Cost inflation, we are a probably 10% year-over-year in terms of costs. Going into the year, the companies were expecting 5 to 7%. It's been exacerbated by the war in Ukraine and supply issues on top of that. So we are looking at operating costs going up 10% year-over-year. Capital costs, costs to build a new mine are going up even more, 15 to 20%, and that's just lack of people, its lack of equipment, it's royalties and taxes going up, it's a whole host of things that are pressuring costs. you understand where the commodity or equities are down, you got prices going up and down and costs going up, you got inflation. That's not all that unusual. >> Recently we had Bart Melek on and he was talking about attention point in the energy trade when you talk about actual physical demand for barrels of crude versus how people play it in the financial markets and the financial is Association of the space. Does the mining sector suffer from that at all in terms of contracts for certain metals not reflecting the true demand for the metal? >> That's a good question. we don't know where demand is going. Are we going to have a mild recession or avoid it completely? Demand is holding up okay. I speaking to a mining company this morning. They have not seen reduction in demand for copper. None. Inventory is extremely low, so the market is tight, demand is holding up, but where is it going over the next six, 12, 24 months? That's the question. The market is saying it's going a lot lower. The market might be wrong. We are going to have to wait and see. It's a bit of a tricky time right now to make the call. >> Great start to the program, great start to the conversation. We will get back your questions on the mining sector or Greg Barnes from TD Securities in a moment. You can get touch with us at any time, just email moneytalklive@td. com or fill out the viewer response box under the video player right here on WebBroker. Right now, let's get you updated on the top stories in the world of business and a look at how the markets are trading. All right, that's yesterday's newscast so I will do a little trick for you here and pull up the one that is fresh for today that I prepared for you. It's always a fun one. Canada booking its largest trade surplus since the summer of 2008 led by strength in crude oil and aircraft exports. Statistics Canada reports the country's trade surplus with the worldwide into $5.3 billion in May and the agency is noting the fifth consecutive monthly increase. Energy exports represented almost 1/3 of total exports for the month. Imports, the other hand, decreased after three months of gains and that was led by a drop in shipments of consumer goods into Canada. Crescent Point Energy is raising its dividend for the second time in as many months. It payout to investors is going up 20%, eight cents per share. They say they hit target sooner than effective. The energy giant exact return more than $430 million to shareholders in the second half of this year. Based on American benchmark crude is at hundred dollars a barrel. Crescent says that buybacksare part of that plan. GameStop is announcing stock splits. it will split its shares into four. Shareholders will receive three shares on July 18. Trading on a split adjusted basis will start as well. Does the, Amazon and another process right here at home on Bay Street, the TSX Composite Index with a very healthy gain now above300 points, 316 points to the upside for a gain of 1.7% and south of the border, the broader read of the market, the S&P 500, is also getting some by action today. One 1/4% the upside of the S&P 500 at 3892. Now we are back with Greg Barnes from TD Securities. We are taking your questions on the mining sector. First one coming in, Dr. Copper, as they call it, down along with Hudbay. Viewers asking, is it a matter of time before the take off to the upside? An optimistic question from the viewer. >> Is alwaysa matter of time for the take off the upside. The question is, what is the timing? I said earlier I thinkthese stocks are now discounting ahard landing. Hudbay is down a lot today,they've had some issues with political unrest and uncertainty which has weighed on the stock and some issues that seem to be resolving in Arizona but the company is in good shape financially. Their exposure to copper is strong and growing with a big project potentially on the pipeline. They will be fine but we have to wait to see the market turn on copper prices for getting too bullish about these things. >> The longer term for copper, we know that if the world wants to electrify, as seems to be the policy of many governments and a lot of companies pushing copper, for my basic understanding, is key to electrification. >> I like to think that copper is the key to elective occasion. In looking at electric vehicles, the distribution of elected city charging stations, winter lines, copper is a key component of every single one of them. You cannot get around that. You may be will to do some substitution with aluminum but by and large you need a lot of copper and more then that we are going to be able to supply potentially over the next decade. If you look at some third-party supply demand forecast that we do have access to and they are looking at deficits of 5 million tonnes by 2030. We will be short 5 million tons of copper by 2030 unless mine supply can respond relatively quickly. >> We feel that we have the reserve? Do we have that much copper? When we talk about the elective vacation of vehicles and other things, we worry about the power grid itself, but if we need this key ingredient, copper, is there enough in the ground on planet Earth? >> There is. It's a question of price. There are a lot of forecasts out there that say copper prices have to go a lot higher from where they've been recently, which is well over four dollars a pound, to justify the next leg of investment in copper supply. I'm not saying we need six or copper, but we certainly need 350 to 4 dollar copper to justify the investment required to bring the next generation of copper mines into production. The copper is there, it's just in Africa, the high end use in South America, very, very difficult places to mine, logistically, infrastructure and power, you have to build all of it to mine that copper and that's expensive and challenging. >> Another view are asking about tech resources. How do we think this company is going to fare in this environment? If I'm not mistaken, tech might have an eye on the copper trade longer-term? > Tech is expanding its copper production. They are completing a copper project by the end of this year. That will double copper production. They are expanding copper and that is the strategy of the company. They want to shift the focus from being what was a metallurgical coal company to a copper company and they are on their way to doing that. We anticipate that by 2023, 2024, they will be more heavily weighted towards copper than they are toward school, which is a good thing. Again, I like to say that tech is a safe haven in this kind of environment. They got a lot of liquidity, no near-term debt repayments, they are just finishing off QB to, so Cassyex is coming down next year. They are well-positioned next year for when things turn to the upside. >> There is the bull case for a name like Teck. What could trip this company up? >> For all these companies, so if you get a higher metal prices then we are seeing today. It won't trip them up, but it will present some challenges. >> Trying to get copper and where it is in the world, you talk about geographic struggles, challenges, right?, These are difficult places. Political risk it, when I think about where mining operations operate globally, some areas are riskier than others. >> That's true and I think the layer on top of that is that countrieswho have been struggling with COVID restrictions and the impact on their national balance sheets needed more revenue, so what we are seeing is a wave of resource nationalism, particularly in South America currently, were the countries are raising royalties, they are raising taxes. Chile is a case in point. This week they announced a higher royalty regime for copper mine. That is a challenge and at the end of the day, it will result, in my view, in copper prices going higher. it's a bit of a vicious circle, if you see what I mean. >>we have a question coming in from the platform. Any concern that the appetite for uranium could cool off permanently if we did fall into a recession? Now we are into nuclear. >> Right. uranium is not really exposed to the economic cycle. Nuclear powerhis baseload power. It is always on, it's consistent, it doesn't fluctuate with the men. That's what keeps countries electrical grids stable, if they have nuclear power. So I don't expect that we will see a meaningful reduction in uranium demand or nuclear power generation in the event that we have a recession. Hard landing, soft landing, no recession, I think nuclear will be consistent. >> How about the world's view on nuclear power? If we go back to 2011, I think I have the you're right for Fukushima, we saw a shift. we saw political concern in countries like Germany saying they didn't want to be in that space anymore. Do you think the world is easing up on that stance they had against nuclear? >> Absolutely. Locally, it's no carbon electricity. If you are serious about your climate goals and reducing carbon emissions, I do think nuclear can play a significant role in that at the country scale. And there has been a shift in attitudes, I think both in public sentiment, a shift in government sentiment, towards nuclear power, back towards nuclear power. And we are seeing it in Japan, piercing it across Europe, not Germany but across Europe. We are seeing it across North America, their big programs announced by the abiding government to support nuclear power, and we have a new wave of nuclear technology coming, small modular reactors that countries are looking at more positively as being lower risk, lower X andmore regional power direction. I think that will be the next wave of nuclear power in the next 10 or 15 years. >> How small are we talking? I'm not going to put one in my driveway anytime soon, right? >> No. But enough to power half of Toronto. >> Really? >> Nothing like Pickering or Darlington, much smaller than that,but significant. >> Make sure to do your own research before you make investment decisions. We will get back to your questions on the mining sector with Greg Barnes in a moment. You can get in touch with us with your questions at any time. Email moneytalklive@td.com. Now let's get you to today's educational segment. We are of course looking at the mining industry today and if you are interested in doing research on specific sectors, WebBroker has tools that can help you. Joining us now is Caitlin Cormier, client education instructor with TD Direct Investing. Caitlin, walk us through this one. > Absently! Hi, Greg. So within WebBroker, we have some really great tools to help you sort of keep an eye on what's going on with different sectors and industries, still a top-rated. Under the WebBroker menus here, we are going to do first is click on research and go under markets and click on overview. So very important page we are coming to you, of course the homes what were you can find MoneyTalk Live as well. But lots of other great content on this particular page. So we're just going to school down, keeping an eye on the left-hand side of the page. So as we get down a little further, we can see sectors and industries shall appear. So under sectors and industries, we can see all the different sectors, kind of how they are currently performing, what their percentage changes are and we can also see here any declines or whether each one is declining or advancing, so obviously the light colour here is declines but dark purple his advances, so we are seeing a lot of positive movement recently and some of the sectors, so that's generally a good sign. We just popped up to the top there. If there was one particular you want to dive into with a little bit more detail, let's look on basic materials, as we click in, it's going to give us a bit more information about that specific sector, so we are going to get a little bit of information about price-to-earnings, we are going to see the different industry names under that particular sector, we can see performance as well, getting lots of information short-term and a little bit longer, so lots of different information that we can see it right within here. >> Alright, great stuff. Caitlin, say we want to choose a specific sector that we want some information on. How do we do that? What kind of information is there? > Absolutely. In this area where we have collected the sector, there is a little bit more as far as it really diving down. If you want to see for example the specific top companies, we can see right here that it gives the names of individual companies that are the top within that area. We can see the bottom performing companies, we can take companies and split them up between high dividends, earnings for growth for that company and price-to-book value. As well is this report here, so you can see this is a basic materials report. If I click on that report, it will pullit up. Let me make sure I can share it here. There we go. You should be able to see it now hopefully. There we go. This is the ink report. So we've got some information on the sentiment indicator. As we scroll down, it tells us as well that companies with net insider buying as well as companies that have… So the sentiment within the industry as well. >> Great stuff as always, Caitlin. Thanks so much for that. >> Thank you. >> Caitlin Cormier is a client education instructor at TD Direct Investing. Be sure to check out the learning centre on WebBroker for more educational videos, master classes and webinars. You have a question about investing or what's driving the market? Our guests are eager to hear with on your mind, so send us your questions. There are two ways you can get in touch with us. You can send us an email anytime@moneytalklive@td.com. Or you can use the question box right below the screen here on WebBroker. Just write in your question and hit send. We will see if one of our guests can get you your answer right here at MoneyTalk Live. We are back now with TD Securities Greg Barnes, we are taking your questions on the mining sector. Here we have a stock specific question. If you're wants to know about Franco Nevada and how its position in this environment. >> Franco, among the precious metal companies, theRoyal companies in general, they have exposureto the commodity price, really. That's what drives the top line of revenue. they have no or little exposure to pressures. They are better position in this type of environment where, as I said earlier, you got the commodity price going down, the cost going up, there is margin compression. The royalty companies just see the commodity price going down but they don't have their costs going up, so they don't have that margin compression to anywhere near the same extent as a producing mining company would have. So they are probably the better place to be in an inflationary environment if you are investing in precious metal equities. >> The risk ofhaving to dig the hole taken off their plates. What's the risk? >> The commodity price. That's what they are ultimately exposed to. So gold prices come down very sharply, they are going to feel that impact as well, and there is some political risk for the minds they have streams or royalties on in a jurisdiction that decides to nationalize. It doesn't happen very often, but it does happen, they would feel that impact too. >> Lots of questions coming in from the platform. here's one. What's a bigger deal for copper: ESG investing as a positive oral recession risk as a negative? I guess the question is a bit of a push and pull between these two things. >> At the end of the day, what drives prices is demand. So by far, the bigger impact, in my view, is what is the recession risk it? If there is a hard landing, copper demand goes zero on negative, you will see a dramatic decline in copper prices and we seen some of that already. ESG, the overprint of ESG certainly has additional cost for the miners but it's something they've been dealing with for a long time. This is nothing new. To get social licence to operate in any jurisdiction, whether it's Canada, Africa, South Africa, you need the local community on side, you need the government on site, you need to do training, you need to manage your tailings, water management has to be exemplary. These are all added costs but they are not new costs that companies haven't been dealing with for a long time. But again at the end of the day, demand drives up prices. >> Are mining companies unique in that sense? So putting in the ESG framework and it feels due to some people, we are a few years into it in a big way, but you're saying that the mining companies already been there. Is that specific to mining? >> I don't think specific to mining necessarily, I don't know if the energy sector has the same characteristics as mining does, but the mining companies have been dealing with these issues for a long time. They know how to deal with them generally and I think they deal with them quite well. >> We are at the halfway point in the lunch trading hour. Let's do a check in on Bay Street and Wall Street. We will start here at home with the TSX Composite Index. If you are along the market, it's the kind of day you like to see after the first half of the year that we had. We have green on the screen, 19,042 for the TSX Composite Index, that the jump of 300 points or 1.67%. Let's look at the S&P 500, it's the upside to the tune of 1 1/4% as we were talking off the top of the show. Investors positioning themselves now, it appears, on some of the bets in the rates market that the Fed will continue hiking as well as our central bank but they won't have to go quite as far as we feared just a couple weeks ago. Of course, it's been a very volatile storyline this year, so today, that's the story. When will we tell you tomorrow? You will find out tomorrow. Let's get back to your questions for Greg Barnes. What's your perspective on Barrick Gold? >> Barrick Gold, along with the other large gold producers, is promising investors capital returns. They just implement it a dividend policy this year, along with a lot of the mining company is, their balance sheets are in good shape so they can return capital to shareholders. When my belief is among the gold companies, the big ones, is they are giving a flat production profile for the next 10 years. There is no growth. The industry has really gone X growth. And I think investors have been fine with that to a point, but the idea of being invested in commodity names is that you want increased exposure and flat exposure doesn't help that much. I think big companies, Barrick Gold included, are struggling to find the right talent between growing modestly verses flat or declining production. They had decline in production a few years ago, they fixed it,what do they need to take the next step and show some growth in production? I think potentially they do and that will get investors excited about the sector again. The gold equities have struggled this year because I think there's been a lot of investor apathy. Your question earlier, the gold price hasn't done much. It hasn't gone down but has got to be there and that's disappointing to some people. Again, the companies are in fine shape but there isn't a lot of interest in the space. >> This goes back to our earlier discussion about the miners versus the streamers in an environment like this where you might want to bet strategically. >> Yeah, again, it's that cost pressure that tilt you towards being more exposed to the royalty companies than the producing mining companies. >> I've got a question off the platform. We talked a little bit about electric vehicles in the context of copper being key for electricity. The question is what are the best battery medals for EV vehicle? >> Nickel, cobalt and lithium, predominantly those are the metals that go into an electric car battery. So which is the best? That's a tough call. Lithium has had an incredible price appreciation. I think it's down now but it was up to $60,000 a kilogram I believe. I think it depends on which metal is in shorter supply at any point in time. I think in the long term there is enough lithium. The cobalt is more challenging. The bulk of the production globally comes from the Democratic Republic of Congo. There are ESG issues in some people's minds attached to that. Nickel is also a key element to battery medals. I think over the long term, there will be enough go but some of the ways that nickel goes into batteries being produced, in Indonesia, there's a very high a carbon footprint. So you're good on one side, creating an electric car, but sourcing that nickel has a large impact. It's a balancing act. It's hard for me to say one better than the other right now but they are all key elements of electric vehicle batteries going forward. >> You talk about sourcing these materials for the first time, it made me think, is there any recycling at play here in terms of how we have used nickel or other base metals in the past? Maybe we don't use them that way anymore. Can they be repurposed in the future? >> You're getting into areas I don't know a lot about. >> I don't know a lot either but it struck me. >> There will be a large electric vehicle battery recycling industry but we are not there yet. We are in the early stages but that will have to develop over time. >> Will get back to your questions for Greg Barnes from TD Securities on the mining sector in a moment. Do your own research before making investment decisions and reminder you can get in touch with us at any time. Give a question about investing or what's driving the market? Our guests are eager to hear what's on your mind. so send us your questions, there are two ways you get in touch with us. Send us an email via moneytalklive@td.com or use the question box right below the screen here on WebBroker. Writing your question and hit send. We will see if one of our guests can get your answer right here at MoneyTalk Live. a deeper dive into the market action right now. We will start with the TSX concert index. in positive territory for today's session. We are up more than 300 points, 1. 6%. It has been a choppy ride recently had a big town turn from the highs of earlier this spring but if you are along the market, this is a market that is clearly moving in a favourable direction. Let's check in on some of the mining and energy names. At Lundin, we have seen a lot of pressures as the world worried about a possible recession but there's a bit of a bounce back today,seven bucks and $0.93, it's up more than 5%. The energy names are getting hit today after dramatic action this week. It was two days ago that the West Texas intermediate dropped by 10 bucks a barrel in one session. Some of these companies getting up bid back into them. Athabasca, $23 a share, up 20%. The S&P 500, it seems that people are thinking the Fed doesn't need to be as aggressive in hiking rakes. It doesn't mean more hikes aren't coming, including the expectations from our central banks next week, but maybe they end up at a terminal rate that's not quite as high as was feared a few weeks ago. there going to be key economic data points for us to keep our eyes on, including labour reports, in terms of figuring out where the central banks are headed. nnever a dull moment. Let's check in on the NASDAQ, the tech heavy index, is doing better than the S&P 500 at 1.7% on the NASDAQ 100. If we look at Occidental Petroleum Corp., this is one that is to the tune of 4.8% today. Back now is Greg Barnes from TD Securities. We've got a question coming in. We talked a bit about the nuclear space, about uranium. With the growing interest in nuclear, what do you think of a name like Cameco? >> Cameco is well-positioned for what we are seeing developing in the uranium industry and nuclear fuel industry. There has been a significant move away from Russian supply. Globally, the uranium industry has been heavily reliant on Russia for all elements. . . Nuclear utilities are trying to figure out how they get themselves when aligned with Russian supply. Cameco, they are in Canada, one of the world's largest uranium producers, they have significant conversion capacity, they have the technology for enrichment capacity down the road, so they are extremely well positioned to benefit from the shift towards more nuclear power, which we believe is happening, and the shift away from Russian supply of nuclear fuel. So they are, I think, well-positioned to benefit significant lay from that. >> What would be a risk here for Cameco? You talked a bit about how the West is pulling back from Russia. Is there anything working against Cameco longer-term? >> The biggest risk, quite frankly is if there is a sea change in relations with Russia and the sanctions are removed and Russia pulls out of Ukraine and things normalize. I don't think that's going to happen, but that would be a risk. Otherwise, for Cameco, obviously as with all mining companies, you have technical risk, whether it's the minds themselves or facilities, and in the past they have had some challenges on the mining front, 10 or 15 years ago now, and they have done well since then. But his technical risk is something you always have to be aware of with a mining company. >> Fascinating stuff. We have run out of time for questions, but we talked about a lot of different things. We pulled a lot of different threads here. If we want to rounded up for final thought, what do you think about the mining sector right now? What do we need to be aware of in the coming months? >> I think what we have to be most aware of in the coming months is what is going to happen economically. Are we going into recession or not? If we are, I think the stocks have discounted a lot of that already. This probably more downside already, but a lot of that is priced in. We are not going into recession, we could have a very sharp snap back in these names and I think some of the action we are seeing today is driven by Chinese stimulus and experts. Overnight, the Chinese premier and asked another $220 billion potentially of infrastructure investment. One that starts to hit the bottom line in China, that will have a significant demand on base metals, significant impact on base metals demand, and we should start to see that impact and demand by late this year, early 2023. So it's not all about recession in the west, it's about what's happening in China and that is a fundamental key point to keep your eye on going forward in the space. >> I'm kicking myself is the host that we got this far into the discussion about the mining sector and I didn't bring up the world's second-largest economy and their appetite for base metals. With China, there some fluctuation, but you're sayingwe shouldn't forget about China. >> I should've brought up sooner. > Is notyour fault. >> Greg Barnes, managing director at TD Securities. We will be back tomorrow with the round up of the best commentary we've heard this week. On Monday, we will be joined by Michael Craig, head of asset allocation at TD Asset Management. he will take questions about the markets and asset allocations. On the topic of the market, let's do a quick check. After the first half of 2022, the rough ride it was, it's good to see some green on the screen. 318 points on the upside for the TSX Composite Index, a gain of 1.7%, and the S&P 500, let's check in on the action south of the border, jump of almost 1.3%. I will call that now. We will be getting jobs data to round out the end of this week, inflation data, a lot of big points awaiting us as investors try to figure out where we are headed for the second half of this year. Of course, a reminder you get a head start with your questions for us here at MoneyTalk Live. You don't have to wait until we are on at noon during the lunch live. [video buffering] [theme music] [theme music] [theme music] [theme music]