TSX down for April 11-15 period

Markets continued in their unsettled behavior as the TSX Composite Index fell a significant 565 points to 13,622.66 for the Apr. 11-15 period.

The volatility in the markets can largely be attributed to geopolitical unrest and debt issues in Europe and the U.S. Here in Canada the Bank of Canada maintained its overnight rate at 1% this week and upgraded its outlook for both economic growth and inflation – despite rising fuel and food prices.

The Bank did, however, warn that a higher Loonie could lower import prices and hurt the country’s exports.

Jittery markets were good news for gold, as the flight to safety brought prices for the yellow metal up US$7 for the period. The metal was trending even higher at press time as it reached an all time high of US$1,496. Higher prices hadn’t yet trickled down to miners, however, as the Global Gold Index fell 10 points to 405.64.

The base metals complex didn’t fare so well. With worries over economic growth holding sway the Capped Metals & Mining Index was down 117 points to 1,418.97 points as the prices for copper, aluminum, nickel, tin, zinc and lead all fell.

Despite a gloomy period for base metals there were still some positive stories for miners.

One of the biggest was Lithium Americas having its share price jumped ahead of the announcement of its preliminary economic assessment study on the Cauchari lithium brine project in Argentina. The company’s shares were up 18% over the period, but the news wasn’t released until Apr. 18. The study outlined a 40,000 tonne per annum lithium carbonate production facility built in two phases, with construction of the first 20,000 TPA phase expected to begin in 2012, and construction of the second phase expected to begin in 2016. Using and 8% discount the study put the projects net present value at US$983 million.

Word that Gran Colombia Gold and Medoro Resources would merge to create a Colombian-focused production and exploration company wasn’t met favorably with by the market. Gran Colombia shares were off 23% to finish at $1.38 while Medoro shares fell 8% to finish at $1.90. The companies say the newly formed company will benefit from the current production and expansion potential at the Gran Colombia gold mine complementing the large scale potential of Medoro’s Marmato project. Both are located on the mid-Cauca gold belt near Medellin.

Unrest in Burkina Faso helped to bring Semafo’s share’s down in value, despite the company pronouncing that there had been no effect on the operation of its Mana mine in the country. The country has been unsettled both by the mutiny in some branches of the army and by violent student protests. The soldiers are protesting over unpaid wages and the situation became serious enough to force the president of the country to dissolve government and name a new army chief. The situation was said to be improving at press time.