STOCK MARKETS — Metal mines awaken to enlivened Toronto markets — Even the gold sub-group recovers modestly in upbeat market

The Toronto Stock Exchange finished with another record high close on July 29, finishing the trading period at 6,801.17 — a gain of 86.92 points — over the trading period July 23-29.

The Canadian dollar was virtually unchanged at noon on July 30, with its value in U.S. terms pegged at 72.41 cents. Both dollars made strong gains against the other major Western currencies, particularly the pound, which re-entered the atmosphere this week following a long period in orbit.

The gold price reached a London morning fix of US$327.50 per oz. on July 30.

The only news in the gold market this week was a report that the Russian central bank had completed a gold purchase, which permitted a brief spike in the price on July 28. Pressure continued in the platinum market, with the metal rising $10.50 over the report period to reach US$426 per oz. on July 30. Silver recovered another 6 cents to finish the period at US$4.36.

The gold and precious minerals sub-group nearly kept up with the broad market, adding 97 points to close July 29 at 8,243.61. Barrick Gold saw 5.2 million shares trade, tacking on 25 cents to close at $30.95. Rumors surfaced again that Barrick would be making a takeover offer for Australian gold producer Great Central Mines, based on a large currency transaction from Canadian to Australian dollars made by an unidentified Canadian company.

Since share-swap takeovers are the Barrick style, the currency trades may be no more than coincidence.

Placer Dome was up 60 cents to $23.10 with 4.8 million shares riding the lights, and Cambior picked up 55 cents to close at $16. Kinross Gold didn’t share in the sub-group’s muted joy, sliding 15 cents to $6.35, and neither did TVX Gold, which closed at $6.35 as well, for a loss of 10 cents.

The London base metal markets caught the wave as zinc ran up to a spot price of US$1,760 per tonne (80 cents per lb.). Indications that there was a large short position in the futures market, believed to be held by Chinese trading companies, brought heavy buying into the spot market in anticipation of an attempt by short sellers to cover their positions with physical metal. The bulls got cold hooves on July 29, and the price plunged to US$1,380 (63 cents) before more support came into the market. Zinc closed at US$1,640 per tonne or 74 cents per lb. in the July 30 morning ring.

Nickel put on its own fireworks display to close at US$3.36 per lb., a gain of 33 cents. The potential of a labor dispute at the Sudbury operations of Falconbridge appears to be driving the market higher.

The metals and minerals sub-group finally started to catch up to the other sectors that have been leading the market in the past three months. The sub-index added 339.28 points during the trading period to close at 5,434.87 on July 29. The 6.6% gain dwarfed anything the other market sectors could muster. Even while facing a possible shutdown, Falconbridge added $2.30 to finish at $29.80 in active trading. Inmet Mining saw the largest volume of trades, with 4.9 million changing hands, and the stock added 85 cents to close at $7.95. Inco benefitted from uncertainty in the nickel market, closing $2.90 higher at $43.50, and Noranda was up $1.20 at $29.65.

Among TSE juniors, Teddy Bear Valley Mines slid 65 cents to close at 75 cents and Northfield Minerals was off 13 cents to 28 cents, both in light trading.

Northfield has recently announced it was taking shares in affiliate NFX Gold in exchange for tax pools and the cancellation of outstanding debt.

On the way up, also without any announcements, was Corriente Resources, which added $1.05 to close at $3.45. Investors may be trying to anticipate news from the company’s Taca Taca copper prospect in Argentina.