Toronto Stock Exchange (October 28, 1991)

Gold lost none of its new-found glitter during the week ended Oct. 22, as analysts continued to assess the impact of new revelations about Soviet reserves on future supply.

A feasibility study released this week by Louvicourt Twp. partners Aur Resources and Societe Miniere Louvem is also expected to keep bankers and analysts busy before mine financing is arranged later this fall. A sleeper of late, Aur shot up by 80 cents within a 48-hour period as the results were being announced while Louvem added 60 cents to its share value. Louvem’s major shareholder Noranda is expected to approve the study before the joint venture goes looking for $326.4 million to finance construction at the copper-zinc project. Noranda gave up 13 cents.

Evidence that the lower-than-anticipated Soviet reserve picture will have a positive impact on gold was provided by the US$6.10 per oz. increase in the yellow metal. Today, Oct. 23, it closed at US$362.20 per oz. in London. Recent advances in the price of platinum are predicated on the view that if the USSR gold reserves are lower than anticipated, platinum inventories might also be much lower, says Martin Murenbeeld, author of the newsletter Gold Monitor. Platinum was up by US$1.35 per oz. this week.

Spurred by improved earnings and a firmer gold price, a number of precious metals stocks moved up sharply. American Barrick Resources, the week’s most active issue, jumped to a new high of $28.63 before slipping back today to $28. Royalty specialist Euro-Nevada Mining also rallied to a high of $15.13 before it ran out of steam to end the week at $14.63.

LAC Minerals and Placer Dome also made the active list before profit-takers forced the issues into retreat. Today, LAC gave up 25 cents to close at $9.88 while Placer Dome was unchanged at $14. Royal Oak Mines finished at 96 cents after trading at over $1.

Riding on the coattails of record trading activity in New York, Toronto’s composite 300 index posted some impressive gains earlier this week. But today the index gave up 8.23 points to close at 3459.16 after 25.8 million shares worth $286.8 million changed hands.

The week was marked by further evidence that the economy is turning the corner and by the first trickle of third-quarter earnings. Despite reporting a third-quarter profit of three cents a share compared with 92 cents a year ago, Inco was impressive. Adding 38 cents today to close at $37.13, the nickel miner ranked fourth on the active list on about 1.5 million shares. Inco’s 40% owned affiliate Fort Knox Gold was active on results from a polymetallic property in Ontario’s Shining Tree area. Trading on 1.2 million shares, Fort Knox advanced by 23 cents to finish at 67 cents. Results included an exciting 110.9-ft. intersection averaging 1.03% nickel and 0.43% copper per ton.

Meanwhile, Metall Mining equalled its low of $10 this week after announcing a reorganization plan that will leave it with a lower direct interest in Cominco and a much larger stake in Teck and Australian mining concern M.I.M. Holdings.

While many analysts believe Metall’s acquisition of the Copper Range mine in Michigan was ill-conceived as the operation has been a drag on earnings, Metall had advanced to $10.63 by the end of the week.

New lows were reached by Belmoral Mines which slipped to 9.5 cents, Cathedral Gold fell to 32 cents and VSM Exploration sank to 70 cents.