Toronto Stock Exchange Middle East, global exonomy drive shares

In a week when Murray Pezim and Ned Goodman were promising either to quit or distance themselves from the mining scene, share prices continued to take a hammering. Rio Algom and Galactic Resources were among the casualties as uncertainty in the Middle East and a weakening global economy drove many issues to equal their 52-week lows.

Reflecting the general mood of uncertainty, the Toronto exchange said during the week ended Oct. 2 that the average daily value of shares traded in the first nine months of 1990 had fallen to $266 million from $330.7 million a year ago. Average daily volumes also dropped to 22.7 million from 25.5 million.

Today, Oct. 3, Toronto’s composite 300 index, which represents a wide measure of Canadian share values, saw its third successive losing session. It closed down 11.88 points at 3179.58 after 20.3 million shares changed hands.

One of the few bright spots was gold. In sympathy with a US$3-per- barrel drop in the price of oil, the yellow metal gave up a full US$16 earlier in the week. But today’s US$5-per-oz. increase pushed the gold silver index up 96.01 points to 6222.55.

By the close of trading today, most of the gold issues had recovered from the drubbing that accompanied the US$16 price drop. Hemlo Gold, for instance, closed up 25 cents at $11. Placer Dome and Pegasus Gold both gained 37 cents, while American Barrick Resources added 50 cents to its share price.

As Corona A shares hit a low for the year of $6, Chairman Ned Goodman said he had substantially retired from the Toronto-based company. Ranked number five in last month’s most active list, Corona Class A shares recovered today to end the week up 12 cents at $6.25.

Apparently frustrated with the effect of an investigation into trading activity involving his companies, Vancouver promoter Murray Pezim has also threatened to leave the mining scene altogether.

Shares of Madeleine Mines, meanwhile, have fallen dramatically in conjunction with platinum prices which gave up a whopping US$7.85 a lb. this week. Uncertainty regarding the company’s palladium-platinum project near Thunder Bay, Ont., may also explain why Madeleine shares have dropped from a high of $9.88 to close $4.45 today.

Noranda shares are also under pressure from the same market sentiment that is currently affecting companies controlled by the Bronfman family. At today’s $16.25 closing price, Noranda shares are trading just above their 52-week low point. Rio Algom wasn’t so fortunate. Today’s $18.25 closing price represented a low for the year.

Like Galactic Resources and Rio Algom, Cheni Gold Mines also bottomed this week at $1.40 though it is spending $2.7 million as part an agreement to earn 60% of the J&L property from Equinox Resources and Pan American Minerals. The funds are earmarked for an underground exploration program.

Pegasus Gold is also moving ahead with construction of an open pit, heap leach gold mine at the Black Pine property in Idaho. With production scheduled for the second half of 1991, Black Pine is expected to produce an average of 60,000 oz. over its 5-year life span.

This week, Galactic Resources and partner Cornucopia Resources began mining their Ivanhoe heap leach project in Nevada. Located north of Nevada’s sulphide-rich Carlin trend, the project is expected to produce 12,000 oz. in 1990 and 60,000-70,000 oz. annually thereafter. Galactic was down 1 cents to $2.09.

The appointment of former Noranda executive Richard Fiorini as president of St. Genevieve Resources indicates to some observers that Noranda will help to plot the future direction of the Montreal company. But a spokesman for St. Genevieve, down 5 cents to $1.13 today, says Fiorini’s previous role as president of Noranda U.S. is purely coincidental.

New lows this week were also reached by Black Hawk Mining, 50 cents, Breakwater Resources 75 cents, Goldquest Exploration 25 cents and Goldsil Resources 15 cents.