Gold’s drop hampers explorers

Junior miners held steady during the March 16-21 period, as the S&P-TSX Venture Composite Index rallied back over the 2,000 level before giving back a little ground to close at 1,978.77. The index was up a marginal 6.59 points over the session, while average daily trading volumes improved to the 64-million-share level.

Gold suffered a US$9.50 drop, closing at US$430.50 per oz. on the New York spot market. A sharp U.S. dollar rally pushed down bullion prices.

Meanwhile, silver was off US28, closing at US$7.07 per oz. on the New York spot market, platinum shed US$7 to finish at US$868 per oz., and palladium closed at US$198 per oz., off US$3.

Copper remained strong, closing at US$1.54 per lb.; nickel closed at US$7.39 per lb., up a dime from a week earlier; zinc fell a couple of pennies, closing at US62 per lb.; and lead shed a cent to end up at US45 per lb.

The slug in precious metal prices affected the tally of new market highs, which came up a little short in comparison with new lows. Thirty-three companies touched new 52-week highs, compared with 39 falling to new lows.

Partners Freewest Resources Canada and Murgor Resources occupied first and second place, respectively, in the weekly volume chart. Freewest saw more than 13.2 million shares change hands and closed up 4.5, or 15%, at 34 per share. Murgor traded almost 5.5 million shares as the stock gained half a penny to close at 17.5. High-grade gold intercepts over considerable widths at the duo’s Windfall project, in northwestern Quebec, continued to lure investors. Also, Freewest came up with a significant massive sulphide discovery on its Sungold project in the Shebandowan area, west of Thunder Bay, Ont. Surface pit sampling uncovered high-grade copper-zinc mineralization in the volcanogenic-massive-sulphide environment. Assays of up to 12.5% copper and 32.8% zinc were returned from a series of small blasted pits over 800 metres of strike length.

The third most active trader was prospective coal miner Cline Mining. The junior saw 5.2 million shares change hands as the stock gained 15 to close at $1.47. The resource on the Lodgepole project in southeastern British Columbia has been updated to 82.5 million tonnes of surface-minable, low-volatile, metallurgical coal. However, development of the resource is being contested by Montana Senator Max Baucus, who is concerned about water quality. Lodgepole is near the headwaters of the Flathead River, which flows south into the state’s Glacier National Park.

The top percentage gainer was Glen Hawk Minerals, which shot up over 167% to close at 56 on a volume of 3.7 million shares. The company has resumed drilling on the Lion gold zone, part of the Leo Lake project in northern Manitoba.

Mexican explorer Soho Resources shed almost 52% of its value. The stock fell 28 on a volume of 2.1 million shares and closed at 26. Drill results from the Tahuehueto polymetallic project in Mexico’s Durango state failed to live up to expectations, prompting the selloff. The company recently closed a brokered $1.5-million private placement financing through Haywood Securities.