Gold prices continued to weaken during the July 12-18 report period, shedding another US$1 on thin volume to reach a London morning fix of US$281.80 per oz. on July 19. By presstime, the yellow metal was trading below US$279 per oz. in the wake of a sudden bout of bank selling and a resurgent U.S. dollar.
Not unexpectedly, most of Canada’s major gold producers declined over the period: Barrick Gold fell 70 to $26.35; Placer Dome was unchanged at $13.80; Franco-Nevada Mining slipped 55 to $16; Kinross Gold edged down another 8 to $1.12; and TVX Gold lost 3 to 78.
In the junior sector, partners Etruscan Resources and Semafo released more high-grade results from a newly discovered zone at their Libiri gold project in Niger. Moreover, the zone appears to represent a new style of mineralization for the property, suggesting that more ounces and discoveries may lie ahead. Etruscan rose 6 to 75, whereas Semafo slipped 2 to 55.
Gammon Lake Resources climbed 25 to $6.10 on news of more promising results from its Ocampo gold-silver project in Mexico. The latest round of drilling not only cut mineralization in an area previously believed to be barren (between the Plaza de Gallos and Refugio zones), but led to the discovery of a new, high-grade prospect elsewhere on the property: hole 107 cut 1.5 metres grading 52.2 grams gold and 1,985 grams silver per tonne. Drilling continues.
Among Canada’s base metal miners, Falconbridge was first out of the gate with its second-quarter results, posting impressive earnings of $126.3 million (70 per share), up from a $30.9 million (16) a year earlier. Falco ended the period up 60 to $18, while rival Inco, set to release its results July 25, fell $1 to $22.50.
Diversified nickel producer Sherritt International rose 10 to $4.60 as it vehemently rejected claims, made by Deutsche Bank Canada, that its plan to distribute dividends to shareholders was “oppressive.” Sherritt says the bank is merely seeking court protection against risks to which it exposed itself through a “highly speculative arbitrage bet” made against Sherritt.
Among the remaining base metal producers: Noranda was down 5 to $15.40 as the company at long last boosted its stake in Falconbridge above 50%; Rio Algom rose 15 to $17.60; Teck‘s B shares were off 30 to $9.55; Boliden fell back 16 to reach $1.92; Cominco slipped $1 to $18.70; and Breakwater Resources crept down 13 to $2.76.
In the diamond sector, Namibian Minerals plunged to a new 52-week low of $3.80 before recovering 14 to end the week at $3.94, for an overall loss of $1.26. The loss follows the release of lacklustre results from the miner’s marine concessions off the coast of Namibia.
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