TSX moves lower, Aug. 6-10

U.S. President Donald Trump’s decision to double tariffs on Turkish steel and aluminum roiled markets and prompted a further sell-off of Turkey’s currency. The S&P/TSX Composite Index fell 0.57% to 16,326.51. Spot gold dropped US$2.10 per oz., or 0.17%, to finish at US$1,211.20 per oz., while the S&P/TSX Global Gold Index lost 2.26% to 175.70 and the S&P/TSX Global Base Metals Index decreased 1.71% to 122.46.

Second-quarter results lifted Pretium Resources’ shares by $1.65 to $12.13. The company’s cash balance jumped more than US$72 million to US$142.5 million due to improved production at lower costs. The company said it reached steady production at its Brucejack mine in the first half of the year, fully implemented its grade-control program and met its production guidance. During the quarter Pretium produced 111,340 oz. gold at all-in sustaining costs of US$648 per oz. gold sold. The company posted net earnings of US$31.1 million (17¢ per share) and adjusted earnings of US$47 million (26¢ per share). Pretium expects production in the second half of 2018 will reach between 200,000 and 220,000 oz. gold for total annual production between 387,000 and 407,000 oz. gold.

Shares of Pan American Silver rose $1.01 to $22.31 on the back of second-quarter results. The world’s second-largest primary silver producer reported net earnings of US$36.7 million (24¢ per share) on revenues of US$216.5 million in the second quarter. Pan American produced 6.3 million oz. silver, 53,400 oz. gold, 14,900 tonnes zinc, 5,100 tonnes lead and 2,000 tonnes copper. The company posted record low cash costs per payable ounce of silver, net of 92¢ by-product credits. Pan American says its silver production is on track to achieve annual guidance of 25 million to 26.5 million ounces. The company ended the quarter with cash and equivalents of US$250.2 million — up US$25.4 million from March 31. “Our operations continue to generate robust cash flow with mine-operating earnings, up 22% compared with the same quarter last year,” said CEO Michael Steinmann. “We are realizing the benefits of increased throughput from the expansions of our La Colorada and Dolores mines, in addition to strong performance and low costs across all our other mines during the quarter.”

Tensions in Zimbabwe after a presidential election on July 30 have put pressure on shares of Caledonia Mining. The landmark election was the first in 38 years without Robert Mugabe on the ballot, but the country has yet to inaugurate the declared victor — Emmerson Mnangagwa. Security forces killed six people during opposition protests that are challenging the poll result. Caledonia Mining’s primary asset is its 49% stake in the Blanket mine, 150 km southeast of Bulawayo, Zimbabwe’s second-largest city, and 196 km north of its border with South Africa. Caledonia Mining acquired the mine from Kinross Gold in April 2006.