STOCK MARKETS — TSE rises on strong gold market and strengthening dollar — Silver continues to stay above US$7 mark; rise in nickel price fails to entice investors

The Toronto Stock Exchange 300 composite index ended the report period of Feb. 4-10 at 6881.49, a rise of 108.04 points, or 1.6%, over the previous period. Trading volumes were strong all week, with only one day seeing less than 100 million shares crossing the floor.

The Canadian dollar gained strength against its American counterpart, rising 130 basis points to finish the week at US69.61cents. The loonie was also up on the pound, the yen and the deutschmark.

On Feb. 11, gold had a London morning fix of US$298.95 per oz., up $3.75 per oz. from the previous week. Silver gained another 4cents, to finish at US$7.09 per oz., while platinum rose a healthy $2.50 to US$389.50 per oz.

The TSE’s gold and precious metals sub-group benefited from the healthier metal prices, climbing 3.9%, or 249.48 points, to 6651.69. Accordingly, gold producers jumped in value, led by Barrick Gold, which gained $1.65 to land at $28.35. Other jumps were made by Placer Dome, up 70cents to $18.25; Kinross Gold, up 20cents to $5.20; and TVX Gold, up 5cents to $4.10.

Franco-Nevada rose 50cents to $31, while sister company Euro-Nevada was given a boost of 95cents to $23.70. Silver producer Pan American Silver also joined in the rally, rising 50cents to $14.90.

Crystallex continued to be the hottest issue on the market, leaping $2.35 over its performance the previous week, to land at $9.75. Although nothing new arose regarding its ongoing legal dispute with Placer Dome, Crystallex has confirmed rumors that Ozwaldo Ruiz, a former government official, has left the company.

In contrast to the previous report period, the TSE’s metals and minerals sub-index lost 16.08 points, or 0.4%, to close at 4096.92. While lead and zinc each lost a penny, copper managed to stay on course, holding at 76cents per lb. Nickel edged 12cents higher to $2.52 per lb., though producer Inco was unable to prosper from the gain. Instead, the nickel giant dropped 55cents to $25.60, a reflection of poor fourth-quarter and year-end results, along with the implementation of restructuring programs at the company’s Ontario and Manitoba divisions. Also off this week were Cominco, down 85cents to $24 and Cameco, falling $1.05 to $45.90.

Several base-metal producers, however, managed to buck the downward trend: Teck B-series shares rose $1 to $20.20; Noranda was up 10cents to $26.40; and Falconbridge climbed 20cents to $19.95. Rio Algom remained steady at $26.65.

Western Copper Holdings rose $1.80 to $9.85, following more successful results from drilling at the El Salvador massive sulphide project in Mexico, a joint venture with Teck. Hole Sal-33, which was drilled on the San Nicolas zone, hit 155 metres of deep-lying massive sulphides. Mineralization in the first 89 metres averaged 1.38% copper, 2% zinc, 16.96 grams per tonne silver and 0.33 gram gold. Drilling is ongoing.

The Potash Corporation of Saskatchewan surpassed its record performance of the previous week, hitting $128.60, a gain of $1.35. The company will bid for the 262-million-tonne Bayovar phosphate deposit in Peru on Feb. 16.

Activity among the penny stocks was lively. Aurado Exploration, which made third spot on the volume leader list with 5.1 million shares passing hands, rose 16cents to 27cents. The company is exploring for gold in northwestern Ontario and will soon begin drilling its Setting Net Lake project.