Daily market update: oil, gold, Tesla, HICL & TRIG merger off, SolGold

The FTSE 100 dipped in early trading on Monday despite post-Thanksgiving gains for US markets last week.

Further selling in cryptocurrencies reflected a risk-off mood as did some volatility in Asian markets – with Japan’s Nikkei 225 seeing material weakness.

This followed a move higher for the yen, which affects the competitiveness of Japan’s export-heavy economy, on speculation the Bank of Japan might increase interest rates this month. US futures also pointed to a lower open on Wall Street later.

Elsewhere, there are still hopes the Federal Reserve might announce a rate cut at its upcoming meeting. Inflation and unemployment data releases on the roster for this week will be closely monitored as the market tries to get a read on the Fed’s thinking ahead of 10 December.

Oil prices ticked higher as traders reacted to Donald Trump’s comments around Venezuela and potential military action and after producers’ cartel OPEC+ stuck to its plan of pausing increases in oil output.

Amid the sabre rattling, gold was also higher, helping to lift precious metals miners Fresnillo and Endeavour Mining.

Tesla

In 2025, it has felt like you could pick any European country and any large percentage out of the air when it comes to sales declines for Tesla.

This time it’s Sweden where Tesla’s new car registrations have slumped 59% year-on-year in November. While not a huge market individually for the electric vehicle maker, this is indicative of a wider trend where Elon Musk’s controversial political stances are affecting the brand.

In Sweden, this is likely compounded by the fact car mechanics are at loggerheads with Tesla and engaged in a long-running strike in an attempt to achieve better wages and benefits.

HICL / TRIG

The merger of HICL and TRIG was doomed from the start, given widespread objections from major shareholders. It’s no wonder the investment trusts have walked away from a corporate tie-up as it would have been a struggle to get the deal over the line.

HICL shareholder CG Asset Management was extremely vocal about the deal, calling it ‘value destructive’ and that it had ‘no strategic rationale’. CG rallied together a group of other institutional investors including Hawksmoor and TrinityBridge to oppose the deal. The investors flexed their muscles and made the boards of HICL and TRIG rethink their plan.”

SolGold / BHP

Dan Coatsworth, Head of Markets at AJ Bell, comments:

A small cap miner seen as a potential takeover target for BHP is now in the sights of China’s largest integrated copper producer.

SolGold has rejected two approaches from its biggest shareholder Jiangxi Copper, the second pitched at 26p per share which values the UK-listed miner at £781 million.

The share price chart would suggest someone knew about the bid approach before it went public. SolGold’s shares had bumbled along between 15p and 20p since mid-August, before soaring on 26 November to 25p. SolGold confirmed on the afternoon of 28 November that Jiangxi had made an approach.

SolGold is sitting on a giant copper exploration project that requires significant sums to bring into production. BHP is the second biggest shareholder in the company, with fellow miner Newcrest sitting in third position.

It’s common for a junior miner with a large prospect to have a major miner on its register, but not three of them. Traditionally, a major would take an equity stake if a project looked interesting as that would give it a front-row seat if exploration results prove fruitful.

SolGold’s Cascabel asset is so big that the junior miner would struggle to finance the project on its own – hence why having three major industry shareholders with deep pockets is a good situation to be in.

BHP has long been seen as the natural owner of the company, so it might be surprised to see Jiangxi pounce on SolGold.

Copper is all the rage, with demand expected to be much greater than supply in the near-term. That dynamic is positive for the copper price outlook, suggesting that Jiangxi wanted to get in quick and increase its future supplies.

Considering BHP’s failed efforts to buy Anglo American, all eyes will now be on its next moves and to see if that involves a counterbid for SolGold.

BHP might do nothing. Buying a rival miner with producing assets might be preferrable for BHP in the current climate, given the ability to acquire more cheaply than the money involved in exploration and development.