Commodities strong but TSX flat

The commodities sector asserted its strength over the April 4-8 period but failed to take the heavily resource weighted TSX Composite Index along for the ride. The Index was off, if only mildly, 4 points for the period, finishing at 14,208.43 points.

Stronger prices for copper, aluminum, nickel, tin, lead and zinc had the Capped Metals & Mining rising 52 points to finish at 1,538.12 points, while silver prices broke above the US$40 per oz. mark and gold climbed US$37 to US$1,469.50. The Global Gold Index was up 21 points to 415.46.

Looking at the broader economy the Bank of Canada’s Business Outlook Survey showed that businesses were anticipating rising inflation largely due to higher energy prices. Still, domestic demand indicators suggested inflation wouldn’t be a near-term problem, and the Bank of Canada was seen as not likely to raise rates until July.

As French backed troops stormed the presidential palace in Cote d’Ivoire, the stocks of both Cluff Gold and La Mancha Resources came back to life. Both company’s have halted gold mining operations in the country due to the political violence that broke out after reigning president Laurent Gbagbo lost and election but refused to cede power. At press time Gbagbo was said to have finally been apprehended. Cluff shares were up 36% to $1.90 for the period, while La Mancha shares were up 6% to $2.31.

The other big news of the period surrounded Equinox Minerals. The copper miner’s shares jumped 34.3% to $7.35 after word came down that Minmetals Resources had launched a $6.3-billion bid for the company. Hong Kong-listed Minmetals Resources, whose largest shareholder is Beijing-based China Minmetals Group, said the offer was contingent on Equinox dropping its bid for Lundin Mining, which was made at the end of February.

The news was good for Golden Predator as well, as the company continues to expand the Bohemian zone at the Brewery Creek gold project in the Yukon. The company’s latest round of drilling was highlighted by 28 metres grading 5.06 grams gold per tonnes and 10 metres grading 3.56 grams. Golden Predator shares were up 26% to $1.12 for the period.

The news wasn’t so good for Ivernia, however, which saw its share price fall by 44% to 22¢ after announcing that it had voluntarily halted all operations at its Magellan Mine in Western Australia. The shutdown came after a sample of dried mud from the bottom of a shipping container coming out of the mine site tested positive for lead contamination. The company said there is no risk to public safety. Initial enquiries also indicate there has not been a breakdown in the washing and inspection procedures for shipping containers leaving the mine site. While the precise origins of the mud is still not known the company says it has initiated a clean up of the mud and is undertaking a comprehensive end-to-end review of all its Mining activities.