By the end of the second quarter copper, was back to a major long-term support level. The commitment of traders has unwound a significant long position and Emerging Markets are retesting the breakout from a decade long position. All this to say, we are at a significant inflection point with the stocks extremely oversold, metal inventories tight and capital reinvestment in projects negligible. We continue to be bullish on the sector and are holding large overweight position. Our overweight thesis has been buttressed by the pickup in M&A transactions in the space. Despite the weakness in the sector, Arizona Mining (a portfolio holding) wa acquired by South 32 at 50% premium all cash offer. Furthermore, as mention earlier, Nevsun Resources was approached by Lundin Mining and is in the process of an unfriendly takeover (Lundin’s cash offer was at a 34% premium to Nevsun’s “pre-takeover” stock price).

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