Juniors feel pinch as gold drops

During the Oct. 27-Nov. 2 report period, TSX Venture Exchange-listed companies traded lower as a group as the gold price lost ground, owing to a strengthening U.S. dollar. The S&P-TSX Venture Exchange index was down 54.38 points, or some 3%, during the period. There were 80 new 52-week lows for Venture Exchange-listed companies, whereas only 15 managed to hit new highs.

New York spot gold ended its stellar performance, dipping to a low of US$416 per oz., before settling at US$420.80. The yellow metal erased any gains it had made the previous week, when it approached the resistance level of US$430 per oz. The gold prices hit 2-week lows, owing to fears that a John Kerry win in the U.S. presidential election would revive some strength in the greenback. Oil changed direction and fell below the US$50-per-barrel level, easing inflation fears.

Silver was off 29, or nearly 4%, to close at US$7.02 per oz., while copper closed up a couple of pennies to US$1.35 per lb. on supply concerns, owing to threatened strikes at some Peruvian mines.

Both platinum and palladium were lower: the former lost US$17 to close at US$826, while the latter closed down US$16, to US$197 an oz.

Topping the volume leaders was Murgor Resources, which traded more than 7.8 million shares and closed up 1.5, to 14. Through a recent agreement with Noront Resources, Murgor can acquire up to a 60% stake in Noront’s Kashabowie Lake property in northwestern Ontario. The property is contiguous with Murgor’s Mystery property, in the Shebandowan belt, and covers the northeastern extension of the La Rose shear zone, where several high-grade gold occurrences have been reported. Noront’s shares gained 5 to close at 53. At 4.4 million shares, it was the volume leader.

In second spot was OntZinc, which traded 5.8 million shares. The stock closed down half a cent to 14. OntZinc is trying to buy Hudson Bay Mining & Smelting from Anglo American and, in the process, boosted its status as a producer.

Third in volume was Spider Resources, which traded 5.3 million shares and ended even at 13.5. Spider and partner KWG Resources intersected 18.8 metres of massive sulphides at the McFaulds Lake 3 property, in the James Bay Lowlands of Ontario. Although assays are pending, a nearby intersection of similar mineralization had previously resulted in 13.8 metres averaging 5.5% copper. The drill program, which shut down early because of cold temperatures, will likely resume in early January.

Crowflight Minerals closed at 35 and saw 2.1 million shares cross the floor. Crowflight and Falconbridge recently formed a joint venture on several properties in the Thompson nickel belt.

Topping the list of percentage gainers was Adobe Ventures, which closed up a whopping 148%, or 32 higher, at 62 on a volume of 1.9 million shares. Adobe is acquiring a company that has the right to upgrade and operate the Carbosulcis coal mine in Sardinia and develop and operate an integrated gasification power plant.

Solitaire Minerals lost 3 to close at an even dime. The company struck a deal last month on the 31.2-sq.-km Highrock Lake uranium property in northern Saskatchewan.