Despite the impact of Brexit on global markets and gold prices, the global mining sector has firmly come off the bottom in the first half of this year. The improving trend clearly indicates the start of a new up-cycle, measured by four key indicators: metal prices, mining equity market values, drilling and equity financings. Metal Prices The spectacular increase in the gold price grabbed headlines for almost six months, even before Brexit became a reality. With gold leading the way, bulk commodities, base metals and speciality metals are up strongly, some even exceeding a 25% improvement while others are still laggards. But the overall trend is a clear indication that the bottom is well and truly behind us and major research houses are generally forecasting continued improvement. Mining Equities Mining equities as a group declined steadily from mid-2014 and were valued well below US$1 trillion for seven consecutive months. In January 2016, they hit bottom at below US$750 billion. From April, the total market value of these 2600 publicly listed mining companies rebounded strongly, once again topping US$1 trillion. Investors are returning to the sector, driving equity values. No doubt, mining company efforts to cut costs, strengthen balance sheets by shedding non-core assets and reducing debt are finally paying off and, combined with broad-based commodity price increases, are luring investors back into mining equities. Drilling Funds for drilling were very scarce over the last two years, when mining companies could not raise equity funds and cash was constrained. During this time, it was cheaper to purchase exploration properties than to make expenditures doing the actual exploration work. Coupled with the bleak commodities price outlook, investors were not interested in funding drilling programs, but that trend is starting to reverse. Drilling results hit a low in March 2016, but since that time an improving trend has been underway. By its nature, results from drilling will lag exploration funding availability, so it may be several months before we can expect a return to a normal flow of drilling results. Financing In the first quarter of 2016, the upward momentum of gold prices was almost instantly reflected in the share prices of major producers like Barrick and Gold Corp. It also trickled down to mid-cap producers and, with greater delay and impact, into the junior sector. In early/mid-2015, for both junior and intermediate mining companies, an upward trend began to appear in both the number of financings and value raised. However, in December last year and the first two months of 2016, the trend severely reversed, hitting a low in February. For March, April and May, the monthly trend has been strongly, up with May alone showing 281 worldwide financing deals raising more than US$750 million. About half the raisings were in the gold sector, with base/other metals together with speciality metals making up the other half. Currently equity fund raisings, underpinned by gold, are showing a strong recovery and are at levels not seen since 2014. Canada’s Toronto Exchange (TSX) has clearly taken the lead for financing junior and intermediate mining companies. In May, it did 75% of 140 gold worldwide raisings of US$457 million and 59% of 82 base metals/other worldwide raisings of US$253 million. The Australian Exchange (ASX) excelled in speciality metals, capturing 71% of 59 worldwide raisings of US$140million. As the largest mining capital market in the world, the strong performance of the TSX is the definitive proxy for the health of the global mining industry. And global mining is finally returning to health.