By: Tomas Ronolski - AllPennyStocks.com News

Thursday, May 19, 2016

The metal & mining sector came under significant selling pressure at the start of this year. Indeed, the SPDR Materials Select Sector (NYSE ARCA:XLB) dropped to its 52-week lows in January. The ETF though has made a strong comeback since then as commodities such as iron ore rallied. Iron ore prices rose sharply in February and March, driven by stronger demand from China. China is the most important market for iron ore. Concerns over a slowdown in China, combined with an oversupplied market, led to the sharp pullback in iron ore prices in 2015.

Shares of major mining companies have also rebounded sharply. BHP Billiton Limited (NYSE:BHP) is now up more than 5% for the year. Shares of rival Anglo-Australian miner Rio Tinto Plc (NYSE:RIO) though are still down more than 1% for the year. Freeport-McMoRan Inc. (NYSE:FCX) is one of the best performing mining stocks this year, gaining an impressive 58.6%.

While the outlook for the mining sector overall remains mixed, there are some sub-sectors that have bullish outlooks. One such sub-sector is lithium, which is seeing strong demand. This morning, Nevada Sunrise Gold Corporation (TSX-Venture:NEV) provided an update on its Nevada lithium projects.

NEV provided an update on its six lithium exploration projects located in Esmeralda County, Nevada. The company holds the rights to 8,980 acres in the Clayton Valley, 7,540 acres in the Lida Valley, and 2,882 acres in the Fish Lake Valley for total acreage under claim of 19,402 acres (7,852 hectares). Each of the Company's lithium projects host an interpreted sub-basin beneath the desert floor – such sub-basins can act as "traps" for subterranean aquifers that may contain lithium brines.

NEV’s Aquarius project is located in the Clayton Valley, approximately 3 miles southwest of the Silver Peak Mine operated by Albemarle Corporation, the only producing lithium mine in North America. The company owns a 100% interest in Aquarius. The Company’s second project called Clayton Northeast Project is located in the Clayton Valley contiguous to the eastern boundary of the Silver Peak Mine. The Neptune project is located in the Clayton Valley approximately 10 miles south of the Silver Peak Mine. Finally, the Atlantis Project is located in the Fish Lake Valley basin, which exhibits similar geological and geophysical characteristics to the Clayton Valley basin southeast of Atlantis.

As mentioned, shares of lithium stocks are on the move higher in the first few months of 2016, with NEV being no exception, however the stock has given back some gains from its recent highs in late April and currently finds itself around the mid-way point of its 52 week range as the bulls and bears battle for future share price direction.

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