Market news

Toronto Stock Exchange

The S&P/TSX Composite Index shrugged off the uncertain economic climate and gained 234 points, reaching 12,415.98 for the period. The index was carried to greater heights on stronger-than-expected quarterly reports from key companies earlier in the period and an uptick in homebuilding south of the border, which could indicate that the housing market is finally turning around.

Those positive winds, however, were dampened by the end of the period as the second wave of quarterly results came in, which showed that companies are indeed struggling within a weakening global economy.

The up-and-down attitude towards blue-chip companies had a middling effect on the price of gold, with the metal down just US$31 to US$1,724 per oz., while the S&P/TSX Global Gold Index trended the other way, thanks to increasing mergers and acquisitions activity. The collection of gold miners in the index managed a 6-point gain to finish at 338.07. 

The diversified miners also trended in the opposite direction of base-metal prices, and the S&P/TSX Capped Diversified Metals & Mining Index was up 29 points to 934.77 — despite the price for copper being down 6¢ to US$3.64 per lb. for the period. 

Brazilian billionaire Eike Batista’s private gold company AUX is back on the acquisition trail in Colombia. Since buying Ventana Gold for $1.5 billion in February 2011, Batista has been looking to further consolidate gold claims in the country’s California gold district. His latest targets are Galway Resources and Calvista Gold. Shares of Calvista were up 114% to $1.07 for the period, while Galway shares were up 69% to $2.15. AUX is offering $1.10 per share in cash for Calvista while Galway shareholders will get $2.05 in cash, plus 0.9 of a share in a new company to hold its Vetas gold project, and one share in a new company to hold its Victorio tungsten-molybdenum project. 

NovaCopper got a boost to its market cap from the drill. The company announced assays from exploration diamond drilling at the South Reef zone of the Bornite property in northwest Alaska. The company said four holes intersected significant high-grade copper mineralization with a highlight of 97.2 metres grading 3.66% copper. The longer intercept is made up of 14.9 metres grading 1.68% copper, 28.8 metres grading 3.79% copper, 15.2 metres grading 5.94% copper and 12.3 metres grading 2.93% copper.

Also in Alaska, Freegold Ventures hit 50 metres grading 1.46 grams gold at its Golden Summit project, and saw its shares climb by 24% to 72¢. Drilling was focused on the Dolphin and Cleary Hill areas, and the results demonstrate they both have significant expansion potential. Some 19,700 metres have been drilled in the Dolphin zone since January, while 5,200 metres have been drilled in the Cleary zone over the same time period.

TSX most active issues

		Volume	Week
		(000s)	High	Low	Close	Change
Capstone Mng	CS	21617	2.57	2.31	2.46	+	0.09
B2Gold	BTO	14283	4.03	3.77	3.9	–	0.03
Barrick Gold	ABX	13134	39.47	37.5	38.55	+	0.24
Kinross Gold	K	12694	10.29	9.75	10.05	+	0.06
Lundin Mng	LUN	12360	5.5	5.04	5.36	+	0.27
Argonaut Gold	AR	12331	10.02	9.17	9.86	–	0.62
Teck Res B	TCKB	11879	32.13	29.73	31.45	+	1.56
Torex Gold	TXG	11701	1.99	1.85	1.94	+	0.01
AuRico Gold	AUQ	10406	8.16	6.84	7.99	+	0.92
Eldorado Gold	ELD	9836	14.55	13.56	14.26	+	0.51

TSX greatest percentage change

		Volume	Week
		(000s)	High	Low	Close	Change
Calvista Gold	CVZ	4495	1.09	0.49	1.07	+	114
TriAusMin	TOR	1901	0.09	0.06	0.09	+	50
NovaCopper	NCQ	207	2.55	1.76	2.55	+	41.6
Dynacor Gold M	DNG	645	1.18	0.88	1.17	+	37.6
First Nickel	FNI	1360	0.06	0.05	0.06	+	33.3
Coalspur Mines	CPT	1669	1.1	0.77	1.06	+	32.5
Northland Res	NAU	1250	0.9	0.67	0.9	+	25
Freegold Vent	FVL	238	0.74	0.56	0.72	+	24.1
BioteQ Env	BQE	1086	0.22	0.16	0.2	+	21.2
Northcliff Res	NCF	49	0.42	0.34	0.42	+	20
Serabi Gold	SBI	28	0.11	0.11	0.11	–	26.6
Homelan d Enrgy	HEG	109	0.02	0.02	0.02	–	25
Entree Gold	ETG	1661	0.5	0.39	0.42	–	21.7
Cobriza Mtls	CZA	54	0.11	0.08	0.08	–	20
Candente Gold	CDG	61	0.15	0.14	0.15	–	18.9
Redzone Res	REZ	328	0.14	0.1	0.12	–	17.8
Victory Nickel	NI	1860	0.03	0.03	0.03	–	16.6
White Tigr Gld	WTG	882	0.12	0.08	0.1	–	16.6
Pac Rim Mining	PMU	386	0.12	0.1	0.1	–	16.6
Lipari Energy	LIP	19	0.25	0.21	0.21	–	16

TSX greatest value change

		Week
		Change	Close	Change
Walter Energy	WLT	22309	38.36	+	3.62
Inmet Mining	IMN	788377	48.99	+	2.84
Agrium	AGU	4521857	103.95	+	2.79
Agnico-Eagle	AEM	3421723	52.41	+	1.91
Teck Res B	TCKB	11878900	31.45	+	1.56
First Quantum	FM	7489747	22.66	+	1.42
Allied Nevada	ANV	1083018	39.29	+	1.37
Tahoe Res	THO	607217	20.83	+	0.99
Silver Wheaton	SLW	5743506	39.03	+	0.92
AuRico Gold	AUQ	10405529	7.99	+	0.92
Kirkland Lk Gd	KGI	4626158	9.77	–	0.99
Detour Gold	DGC	1382798	26.86	–	0.89
Alamos Gold	AGI	1219422	18.48	–	0.69
Centerra Gold	CG	3173958	11.33	–	0.67
Royal Gold	RGL	39438	86.06	–	0.64
Argonaut Gold	AR	12330820	9.86	–	0.62
Sprott Ph Silv	PHSU	133171	13.14	–	0.6
Potash Cp Sask	POT	7431172	40.29	–	0.53
Central Fund	CEFA	301462	22.1	–	0.47
Karnalyte Res	KRN	53291	8.08	–	0.41

TSX Venture Exchange

The S&P/TSX Venture Composite Index gained 22.8 points, or 1.8%, before closing out the trading week at 1,315.62. Promising news from the U.S. and China early in the week drove gains, while disappointing earnings from major American companies and the Canadian Radio-television and Telecommunications Commission (CRTC) decision to nix the Bell-Astral media deal curtailed market momentum later in the week.

The Canadian dollar fell to its lowest point in eight weeks at US100.68¢, as energy and metal markets struggled. Copper was hit particularly hard, falling US11¢ to US$3.64 per lb., while December contracts for gold bullion fell US$22.10 to US$1,737.61 per oz. 

Toronto-based, Colombia-focused gold explorer Galway Resources jumped 93¢, or 76%, to close the week at $2.15 per share. The activity followed news of a takeover offer from Eike Batista’s AUX. Under the agreement, Galway’s shareholders would receive $2.05 in cash, 0.9 of a share in a spin-out company that will hold Galway’s Vetas gold project and a share in another spin-out company that will hold the Victorio tungsten-molybdenum project. The price marks a 47% premium over Galway’s 20-day volume-weighted average share price of $1.39 ending Oct. 18. The company’s shareholders will maintain a 90% stake in the Vetas spin-out and a 100% stake in the Victorio spin-out.

The takeover bid followed on the heels of news of three new high-grade discoveries at the Vetas property. The company was testing six surface anomalies and results were highlighted by 4.2 metres averaging 26 grams gold per tonne in hole 61, and 6 metres carrying 34 grams gold and 572 grams silver in hole 49.

Barkerville Gold Mines is back in the news after the company was slapped with a cease-trade order by the British Columbia Securities Commission (BCSC) on Aug. 14 — an order that remains in effect at press time. Barkerville shares were barred from trading after the company filed an inadequate technical report on its Cow Mountain gold deposit in central B.C. The company is in the process of a technical review on Cow Mountain aimed at addressing the BCSC’s disclosure concerns. As part of the review, Barkerville has completed an additional 14 surface diamond holes, including 9 twin holes totalling 2,800 metres.

The company also provided an update on its QR mine and mill site southeast of Quesnel, B.C. Gold mining operations have reportedly begun at the site with stripping, blasting and drilling underway at the West zone. Barkerville is also working to raise its storage facility dams so that it can meet permitting requirements.

TSX-V most active issues

		Volume	Week
		(000s)	High	Low	Close	Change
Galway Res	GWY	17779	2.29	1.23	2.15	+	0.93
Feronia	FRN	11761	0.13	0.08	0.13	+	0.06
RPT Uranium	RPT	11009	0.02	0.01	0.02		0
Abitex Res	ABE	8485	0.02	0.01	0.02		0
Sunridge Gold	SGC	8156	0.21	0.2	0.21	–	0.01
Aurcana Corp	AUN	8118	1.11	1.02	1.03	–	0.06
Bitterroot Res	BTT	7203	0.18	0.13	0.18	+	0.04
Sandstorm Mt&E	SND	6184	0.49	0.44	0.46	–	0.02
Golden Touch R	GOT	5831	0.04	0.02	0.04	–	0.01
Mazorro Res	MZO	5663	0.05	0.03	0.05	–	0.02

TSX-V greatest percentage change

		Volume	Week
		(000s)	High	Low	Close	Change
Southern Hemis	SH	48	0.2	0.17	0.19	+	117.6
Sheltered Oak	OAK	1529	0.01	0.01	0.01	+	100
Groundstar Res	GSA	1275	0.01	0.01	0.01	+	100
G4G Res	GXG	51	0.05	0.05	0.05	+	100
Sirios Res	SOI	928	0.2	0.01	0.13	+	85.7
Galway Res	GWY	17779	2.29	1.23	2.15	+	76.2
Feronia	FRN	11761	0.13	0.08	0.13	+	73.3
MPH Vent	MPS	219	0.03	0.02	0.03	+	66.6
Shane Res	SEI	112	0.03	0.02	0.03	+	66.6
Stronghold Mtl	Z	264	0.32	0.19	0.32	+	65.7
Caldera Res	CDR	1424	0.01	0.01	0.01	–	50
Stone Res	SRH	167	0.02	0.02	0.02	–	50
Valhalla Res	VH	50	0.06	0.05	0.05	–	50
Greenock Res	GKR	102	0.03	0.02	0.02	–	50
Valterra Res	VQA	1208	0.15	0.07	0.08	–	46.6
BCM Res	B	37	0.12	0.07	0.07	–	44
Colombia Crest	CLB	663	0.24	0.13	0.13	–	43.1
Red Pine Expl	RPX	1213	0.03	0.02	0.02	–	40
Source Expl	SOP	1153	0.16	0.09	0.1	–	39.3
Ocean Park Vnt	OCP	256	0.09	0.06	0.07	–	35

TSX-V greatest value change

		Week
		Change	Close	Change
Galway Res	GWY	17779127	2.15	+	0.93
Chesapeake Gld	CKG	38223	9.2	+	0.65
Kennady Diam	KDI	106141	1.6	+	0.5
Probe Mines	PRB	1363870	1.72	+	0.31
Lumina Copper	LCC	346265	9.27	+	0.27
Dia Bras Expl	DIB	80967	2.9	+	0.25
Tsodilo Res	TSD	32 941	0.98	+	0.23
New Oroperu Rs	ORO	83440	0.61	+	0.19
Northquest	NQ	808687	0.89	+	0.19
Sandstorm Gld	SSL	1522573	13.48	+	0.17
Gold Reach Res	GRV	145327	1.49	–	0.21
Bralorne Gold	BPM	234614	0.64	–	0.18
Foran Mng	FOM	12305	0.53	–	0.16
GoldQuest Mng	GQC	4403923	0.86	–	0.15
Gold Reserve	GRZ	28983	3.11	–	0.13
Giyani Gold	WDG	408927	1.13	–	0.11
Bear Creek Mng	BCM	406581	3.51	–	0.11
Ascot Res	AOT	343358	1.28	–	0.11
Copper Fox Mtl	CUU	1151650	1.08	–	0.11
Rugby Mng	RUG	16400	0.4	–	0.11

U.S. markets

Disappointing earnings from U.S. bellwethers McDonald’s and General Electric soured an already grim mood on Wall Street, with Oct. 19 marking the worst day the Dow Jones Industrial Average has had since June 21. The Dow eked out a gain of 0.11% to finish the week at 13,343.51, while the S&P 500 Index edged 0.3% higher to 1,433.19. The Philadelphia Gold and Silver Index rose 0.49% to 185.80.

Some upbeat economic news from China helped make Freeport-McMoRan Copper & Gold the fourth most actively traded stock of the week, and sent its shares US$1.04 higher to US$41.18. China’s economy grew 7.4% year-on-year in the third quarter, prompting Dong Tao, chief economist for Non-Japan Asia at Credit Suisse, to suggest that the Chinese economy is stabilizing. 

BHP Billiton advanced US$2.80 to US$71.14 per share. In an Oct. 17 exploration and development report, the mining group said its 19 “low-risk, largely brownfield projects currently in execution” are expected to deliver strong financial returns to shareholders, with most projects scheduled to reach first production before the end of the 2015 financial year. It also confirmed capital and exploration expenditure of US$22 billion in the 2013 financial year. 

Rio Tinto gained US$2.31 to US$51 per share. In its third-quarter operations review the company pointed to record quarterly production at its Pilbara iron-ore operation, as well as higher year-on-year production of copper, bauxite, alumina and titanium dioxide. Pilbara produced 63 million tonnes in the quarter for a 5% increase over the third quarter of 2011, while total mined copper production climbed 21% year-on-year due to expected higher copper grades at Escondida and Kennecott Utah Copper, and increased ore delivered at Escondida. Bauxite and alumina production were up 13% and 20%, driven in part by greater third-party demand for bauxite, larger refining capacity at Yarwun and record production at Grove. Titanium dioxide feedstock production rose 5% year-on-year, while thermal coal production rose 21%.

U.S. most active issues

		Volume	Week
		(000s)	High	Low	Close	Change
Alpha Nat Res*	ANR	179853	9.74	7.68	8.97	+
Arch Coal*	ACI	109614	8.55	7.46	7.91	+
Alcoa*	AA	79155	9.27	8.63	9.01	+
Freeport McMo*	FCX	72599	42.89	39.5	41.18	+
Peabody Enrgy*	BTU	54078	27.94	25.29	25.89	+
Cliffs Nat Rs*	CLF	41987	46.5	40.31	44.45	+
Barrick Gold*	ABX	37880	40.31	38.24	38.78	–
Kinross Gold*	KGC	35069	10.51	9.91	10.1	–
Hecla Mining*	HL	25036	6.8	6.28	6.51	+
Molycorp*	MCP	23225	11.89	10.36	11.05	+

U.S. greatest percentage change

		Volume	Week
		(000s)	High	Low	Close	Change
NovaCopper*	NCQ	2375	2.61	1.77	2.55	+
El Capitan Pr*	ECPN	1444	0.42	0.3	0.4	+
Quaterra Res*	QMM	251	0.59	0.39	0.47	+
Alpha Nat Res*	ANR	179853	9.74	7.68	8.97	+
Alumina Inc*	AWC	1200	4.05	3.57	3.96	+
AuRico Gold*	AUQ	3842	8.27	6.98	8.06	+
Western Coppr*	WRN	42	0.76	0.67	0.76	+
Mesabi Trust*	MSB	721	30.6	27.52	30.06	+
OM Group*	OMG	2019	20.66	17.52	19.54	+
Cliffs Nat Rs*	CLF	41987	46.5	40.31	44.45	+
Silver Dragon*	SDRG	179	0.01	0	0	–
Santa Fe Gold*	SFEG	470	0.38	0.3	0.31	–
Entree Gold*	EGI	1807	0.54	0.4	0.43	–
Cornerstone C*	CTNXF	67	0.08	0.06	0.06	–
Kimber Res*	KBX	334	0.67	0.58	0.58	–
North Am Pall*	PAL	11219	1.85	1.57	1.65	–
Strata O&G*	SOIGF	37	0.13	0.1	0.11	–
Rare Elemt Re*	REE	1238	4.76	4.33	4.34	–
Cardero Res*	CDY	903	0.65	0.54	0.6	–
Ur-Energy*	URG	158	1.01	0.91	0.93	–

U.S. greatest value change

		Week
		Change	Close	Change
Cliffs Nat Rs*	CLF	41986967	44.45	+	3.95
Mesabi Trust*	MSB	721160	30.06	+	3.02
BHP Billi-BHP*	BHP	15710316	71.14	+	2.8
Walter Energy*	WLT	3752611	38.27	+	2.73
BHP Billi-BBL*	BBL	2907432	64.73	+	2.61
Rio Tinto*	RIO	2259623	51	+	2.31
OM Group*	OMG	2018905	19.54	+	1.78
Intrepid Pots*	IPI	1074601	22.08	+	1.51
Agnico-Eagle*	AEM	6748297	52.67	+	1.17
Teck Res B*	TCK	12470393	31.67	+	1.17
Cabot Corp*	CBT	2142224	34.59	–	2.04
Royal Gold*	RGLD	6724914	86.58	–	2.02
AngloGold Ash*	AU	9606397	33.21	–	1.07
Soc Quim&M Ch*	SQM	1266670	58.24	–	1.01
Potash C Sask*	POT	20970616	40.58	–	1.01
Central Fund*	CEF	3993777	22.23	–	0.87
Natural Rs Pt*	NRP	301574	21.57	–	0.82
Buenaventura*	BVN	3364037	35.94	–	0.82
Randgold Res*	GOLD	2880902	120.55	–	0.67
Mag Silver*	MVG	26061	11.31	–	0.52