News overnight that after a four-week standoff it is rumoured that Nevada’s Newmont Corporation and Australia’s Newcrest Mining are set to talk.

The subject for discussion is the February $24.5bn bid by Newmont for Newcrest Mining, the Australian partner with Greatland Gold (LON:GGP) in the important Havieron gold prospect.

Approach rejected

The Newcrest Board rejected the unsolicited approach a month ago, with immediate reactions that its business was worth a great deal more than Newmont was offering.

Previously the two sides had not been talking about the bid, but news overnight has suggested that the two sides could well be getting around to a meeting to discuss the bid and its values.

It is suggested that if the two groups sit down together then Newcrest will be given the opportunity to show its gold and copper mines and projects interests in Australia, Papua New Guinea and Canada.

Show me yours

That display of value would also see the Newcrest Mining interest in the Havieron gold-copper project Greatland Gold’s flagship project which is next to Newcrest’s major Telfer gold mine in the Paterson region of Western Australia.

Greatland Gold Investor Roadshows

Investors are getting excited about Greatland Gold’s potential, while the company is currently underway with a series of UK and European roadshows.

Could this be good news for the group

Newmont is the world’s largest gold company, so the combination of the two majors would create an absolute mining giant in Australia.

The thoughts are that perhaps Greatland Gold’s interest in Havieron is too close to Newcrest’s Telfer producer and not to be dismissed as an acquisition interest – such a purchase would be ‘pure petty cash’ to the giants but highly beneficial to Greatland.

On the other hand, Greatland Gold could perhaps be given the opportunity to purchase out Newcrest’s 70% stake in the Haveiron joint venture.

Either way shareholders could be the winners

Private investors now seem to be thinking that either way Greatland Gold shareholders could be on the winning side.

Greatland Gold, which has a proven track record of discovery and exploration success has a number of exploration projects across Western Australia, is currently valued at around £372m, with its shares trading at 7.20p.

European indices were trading like penny stocks on Monday as risk-off trade gripped markets despite HSBC acquiring SVB’s UK arm and US authorities stepping in to protect US depositors.

The Italian FTSE MIB was down around 4% at the time of writing Spanish IBEX was down over 3%. The FTSE 100 was down around 2.3%. All European indices were off the lows as this article was written.

“Despite the best efforts of governments and regulators, the market was still very edgy on Monday as investors considered the fallout from SVB’s collapse,” said AJ Bell investment director Russ Mould.

European banks were among the worst performers on Monday as fears gripped investors despite the absence of evidence of financial pressure among other institutions.

Standard Chartered was down over 6% at the time of writing.

US Interest Rates

SVB abruptly shifted the market narrative from interest rate hikes to financial stability last week. However, attention quickly snapped back to expectations of the Federal Reserve’s next move on Monday.

US futures had opened the session higher but the rally faded as we moved towards the US open. The positivity in US futures was attributed to the dialling down of interest rate hike expectations during the volatility caused by SVB’s failure.

“This situation has also significantly impacted expectations for the upcoming Fed decision with many now expecting a 25bp hike when it seemed almost certain for some that the US central bank would raise rates by 50 bp previously,” said Walid Koudmani, Chief Market Analyst at online investment platform XTB.com.

Goldman Sachs said they now expected there would be no rate hike at the Federal Reserve’s March meeting due to market volatility and disruption of the banking system.

Further volatility

Although European indices had recovered from the lows of the session, analysts highlighted the skittish nature of market and warned of more volatility this week.

“In any case, markets remain very reactive and susceptible to further developments and could continue to be volatile throughout the week as a major domino effect could cause widespread risk-off moods leading to further losses for stocks and riskier assets,” said Walid Koudmani.

The US President is expected to make a speech today, and tomorrow we will receive the next instalment of CPI date.