I was struck by the Financial Times report that Chinese bonds were luring in foreign investors hungry for yield. My office is decorated with gorgeously printed early 20^th century bonds which, alas, are worthless. The most beautiful of all is the trilingual Emprunt 5% de 1913 issued by the Chinese government in Paris to raise £10 million funding for the Lung-SingU-Hal railway. I bought it in Hong Kong before the 1997 Anschluss. With all those languages (not including Flemish!), it is a graphics stand out against the paper of Lebanon, Argentina, Russia, Spain, and France. The buyer put up £20 and was promised 3% per year from the railway operator in Belgium.

Alas, this was not a good investment in 1913. I wonder if foreign buyers are going to do much better with PRC paper issued in Hong Kong now. If you have a share certificate from Kodak KODK from before its bankruptcy you might try to flog it after the US administration designated the company to make active pharmaceutical ingredients against coronavirus and the share rose 2000% so far.

Today Generals Electric GE and Motors GM reported and both were bought enthusiastically and Boeing BA rose despite deplorable news. Of all things, Tupperware TUP did brilliantly. I hope the ladies were on-line and not together. Three of our shares reported so far discussed below.

Mining

*Canadian uranium miner Cameco reported a whopping Q2 loss resulting from costs to fill its supply contracts from the spot market. Having shut-in its Cigar Lake Canada mine and McClean Mill in 2011 because of a nuclear fuel glut, it will reopen them in September to eventually produce 86.3 mn lbs with its 50% partner, starting with 5.3 mn this year. CCJ has $878 mn in cash and a $1 bn credit facility to fund the re-opening of its Saskatchewan mine, it is much better situated than most uranium miners but CCJ stock nonetheless fell 14.5% today. (All dollars are Canadian.) It lost C$53 m or 13 loony cents per share in Q2 while sales rose 35% from prior year to C$525 mn.

CCJ is a key player cutting dependence on carbon fuels, and nuclear has to become part of the new energy system. It expects that world nuclear power generation will rise 55% by 2040 from the last full year for which we have world-wide data, 1918—from 26.6 trillion terawatts to 41.4 trillion. So far CCJ has been cautious with the reopening, but restarted its Port Hope UF6 plant and the Blind River refinery. There is no word yet on McArthur River where it owns 69% of a jv with 273.6 mn lbs of uranium reserves and its Key Lake operations which await long-term deals for 18 mn lbs of uranium.

There is also a joint venture in Inkai in Kazakhstan with Kazatomprom still off the market because of the pandemic. It also has 2 further curtailed mines, one in the US, and advanced projects which it can bring on in Saskatchewan.

The uranium market is growing faster than expected when Cigar Lake was closed after the Japanese nuclear disaster, and there are now 440 reactors operating globally and 54 under construction, according to the International Atomic Energy Agency mainly because of Chinese moves toward nuclear power with 48 plants operating and 11 more coming. Australia (battered by fires from global warming) is building a round dozen new nuclear power plants. Russian uranium is banned from import to the US where there are 96 nuclear power plants.

The rise in nuclear demand caught CCJ wrong-footed and worried that reopening its mine could be dangerous in the pandemic. Spot uranium prices YTD are up 41% to US$ 32.80/ounce and long-term prices are up 13% to US$35.50/oz. Volumes of uranium buying by utilities, producers, and others have hit new records every month since March. CCJ lost C$7 for every ounce it sold in Q2!

This is the result of unplanned interruptions of mining because of the virus and faster de-stocking of earlier uranium stockpiles. Helping CCJ deal with restarting is its tax court victory against Revenue Canada (their IRS) so it has $878 mn in cash. It also has unmatched underground mining, milling, and refining know-how.

*Kirkland Lake Gold (Canadian KL) reports tomorrow.

Banks

*Banco Santander in Spain reported its first loss in 160 years of banking, euros 11.bn (S12.25 bn or so) from loan loss charges, writedowns. and impairments of acquired assets in Britain, the USA, Brazil, Mexico, and of course Spain. The cause was coronavirus and losses in Britain, where SAN is the leading foreign bank. Its corporate borrowers had problems paying back loans and its retail clients were hit with unemployment.

SAN stock fell 4.3% in Europe and opened here down 3.9956% all the same. This writedown is a one-off. Under European Union rules which don't allow payment of dividends SAN is issuing a second 10 Eurocent “scrip” dividend which can be used to purchase more of its stock, which opened the year at $4.35 and now is $2.33. I am not sure the scrip will be accepted for ADR purchases, but I am tempted. Besides being the largest bank in the European Community, SAN is also active in the US and Britain. Moreover its chair is Ana Patricia Botin, a female member of the ruling clan from its foundation.

Ms Botin, who used to run the UK network of her family's bank, stated: “The past six months have been among the most challenging of our history, but the foundations of our business remain extremely strong.” The chairlady also said that the bank is assuming that there will be economic contraction this year and a recovery starting in 2021.

*Banco-Latino Americano de Comercio Exterior fell another 4.75% today despite reporting good results yesterday. BLX sounds scary.

Technology

*Israeli Tower Semiconductor fell 11% today after the Israeli company reported sales up modestly in Q2 both sequentially and y/y. However it had a real rise in profits, to $19 mn from the $17 mn in Q1, but down from last year's $21 mn. Per-share net of non-recurring items it earned 18¢ vs prior quarter 16¢ but under last Q2's 20¢. Its cash flow from operations (EBITDA) hit. $67 mn net of the $63 mn payments for the capacity expansion program. This is consistent with the forecast for 2020 of $310.2 mn. It also repaid $5 mn of its debt. It forecast sales topping $320 mn in Q3 plus or minus 5%.

However, it missed consensus EPS forecast of 23¢ by a nickle for which it was heavily penalized. Its price-earnings ratio is now 21.2 which is seriously tempting for a tech company. It also has lower debt than raivals

CEO Russell Ellwanger state that “we continue to guide quarter over quarter growth, a strong affirmation of our offerings, our increasing market share, and the high value our customers assign to our SiGe (silicon germanium) platform.” The analyst contingent chopped their forecast for the full year to $1.03 in May from $1.10.We bought into TSEM at the advice of fellow newsletter writer Gen. Joe Shaefer, USAF-Ret, who advises that the very high speeds of its foundry wafers using this combination of inputs is a strong plus. TSEM licensed its interconnect tech to Invensas and its stacked image sensor tech to Xperi and Infinera st the end of the quarter and also presented automobile radar tech at an auto conference. It peddles customized analog chips. TSEM is called TowerJazz in the US after its Texas plant. It also has plants in Japan. I could not attend the 10 am webcast today.

*Chinese electric vehicle maker Nio NIO is up 3.15%. We doubled our money in Max Deml's pick.

*Poor auto outlook took down Japan's Fanuc robot-maker. FANUY bots work in other sectors too.

*Chinese robots are doing better. Hollysys Automation, HOLI, is up 2.2%/

*Mercado Libre is up 4.6%. The real Amazon for Latin America, MELI reports mañana before the bell.

Drugs

*Good Dr Reddy's of India hit a new high today. RDY was recommended by our India reporter Abhimanyu Sisodia. It is up another 7.4% at $58.5. It reported on its Q1 today with net income of $77 mn, or 46¢/sh. Sales hit $585 mn. It has jumped 34% YTD. Our reporter will have the details tomorrow. Its Xeglyze (abametipir) lotion licensed from Hatchtech won FDA approval for treating head-lice.I hope this is not why it is gaining!

*Compugen CGEN of Israel will report before the bell tomorrow. It is up 1.2% today.

*Teva TEVA gained 4.64% after it filed to produce its migraine medicine Ajovy in Japan under license to Otsuka. It will probably go over $12

*Astra Zeneca AZN was rated buy by Barclays with a target price of £93/sh. Its ADRs are 5:1 to UK shares.

*Glaxo GSK warned that its earnings will be hit if people delay regular vaccinations because of the virus and not traveling. It also joined a deal to supply Britain with 60 mn doses of the coming COVID-91 jab.