The stock market is closed today after a 4 day week that saw a lot of nervousness. Geopolitical risks seemed to be heightened by tensions between the EU and the UK and the US under the leadership of Donald Trump seems to lack direction. The Federal Reserve plans to increase interest rates, Trump wants them to stay low. The United States needs its own people to save and invest. They can’t rely on more inward investment from China and so a more regulated and less risky financial system coupled with higher interest rates would seem to make sense. Meanwhile, we small investors need to avoid putting all our eggs into one basket by diversifying.
The surprise news of the week came from Solo Oil which announced it was investing in helium exploration by buying a 10% interest in Helium One Limited with an option to buy a further 10%. This news trashed the share price even further and wasn’t greeted with enthusiasm by the market. This acquisition could add to Solo Oil’s hidden value. The hidden value is in the gas field that Ntorya2 was supposed to validate. Now we have bought into more potential value but that is all Solo Oil is, potential without the realisation of value. The gas sales from the Ruvuma well was realisation of value and fuelled optimism about Ntorya2 leading to a soaring share price which then crashed when shareholders were disappointed with results.