Juniors pumped as gold moves to 18-year highs

The big news this week for the junior mining sector is the gold price which managed to make it past the US$440 mark with participants cheering the climb. Venture Exchange-listed companies were looking up, however, there is still a lot of weakness in the sector as 88 TSXV-listed companies hit new 52-week lows, while only 24 managed to hit new highs.

The S&P-TSX Venture Exchange Index was up 29.3 points (1.7%) to 1,660.80 over the period Nov. 10-16.

New York spot gold ended the period just shy of US$440, moving up past US$441 before settling at US$439.80. The yellow metal — which hasn’t seen these levels since 1988 — is being viewed as a favourite hedge against inflation in the U.S. It is largely thought that the U.S. government will opt not to raise interest rates to combat inflation because of the risk to economic growth, and that bodes well for gold. Many think that once gold reaches US$450, there is no stopping the rally and US$500 is within reach in the foreseeable future.

Tyler Resources topped the most-active list with nearly 6.8 million shares traded. Another 14.5 was tacked onto its share price for a close of 57. The company is advancing its Bahuerachi property in Chihuahua state, Mexico, drilling breccia bodies over a 1.2-km strike length. Drill results this spring confirmed a porphyry associated with breccia-skarn bodies as well as a supergene copper blanket. The drilling returned an overall weighted average of 2.29% copper, 0.12 gram gold, 15.9 grams silver and 0.40% zinc over 24 metres.

In second spot was Entre Gold with 5.2 million shares traded; its shares rose 8 to close at $1.03. Results from rock samples suggest that the Bayan Ovoo copper showing on the company’s wholly-owned Lookout Hill property in Mongolia is more extensive than first thought. Twenty samples returned more than 1% copper and another 22 returned values between 0.1% and 1% copper; another returned precious metals values. Entre’s ground covers 1,400 sq. km outside Ivanhoe Mines’ earn-in area.

China Diamond was third on the most-active list with 3.9 million shares changing hands. Its shares were up 2.5 cents to 16. The company recently appointed a new president and CFO after its Changma 701 diamond mine in Shandong, China, reported its two best monthly production results since 1970. In October, the 701 mine produced 10,123 carats, greater than 1 mm in diameter, from 10,904 tonnes grading 0.93 carat per tonne. During the previous month, the mine produced a record 11,347 carats.

Trading in Canalaska Ventures was hopping with 2.7 million shares changing hands. The company’s shares were up 9 to close at 38. Having recently jumped on the uranium bandwagon by acquiring ground in the Athabasca Basin in Saskatchewan, the company is wasting no time in flying a 1,600-line-km transient-electromagnetic survey on two of its properties.

Also on the most actives list was Alexis Minerals which tacked on 5.5 on 2.4 million shares to close at 44. The company, with joint-venture partner Noranda, found a new base metal discovery on their Lac Montbray property in Montbray Twp., Que. One hole on the property returned 5.61% copper, 1.7% zinc, 0.34 gram gold and 17.6 grams silver over a core length of 5.16 metres from a 110-metre depth.