Juniors weak as gold price climbs

Toronto Venture Exchange-listed companies picked up a bit of ground as gold prices rose on terrorist fears. Following suit, the S&P-TSX Venture Exchange index rose by nearly 44 points, or some 3%, over the trading period July 28-Aug. 3 to close at 1511.54.

Meanwhile, the price of gold managed to tack on US$6 an ounce, or 1.5%, and ended the period at US$393.40 per oz. in New York. Gold got a boost from heightened alerts of terror attacks in the U.S. The yellow metal touched a new low of US$386.20 per oz. over the period, after the U.S. dollar rose to its highest level against the euro in a month. The dollar was showing strength from increased consumer confidence in the U.S., which sparked fears of a hike in interest rates.

Silver climbed 7% higher to close at US$6.64 an ounce, and copper was trading up to US$1.32 per lb. from US$1.24 in the week-earlier period; the increase reflects supply concerns stemming from a fire at the Al Norte copper smelter in Chile. Platinum fared well, recovering ground from the previous period to close at US$831 per oz., while palladium slipped to finish at US$216 per oz.

New 52-week lows outnumbered new 52-week highs by almost 16 to 1 over the trading period. Seventy-nine companies sunk to new 52-week lows, compared with only five that reached new highs.

Topping the volume leaders was Shore Gold, with more than 2.3 million shares crossing the floor. The company recovered the biggest diamond yet found in Saskatchewan, a whopping 19.7-carat stone, from the third set of recoveries from bulk sampling on the Star Diamond project near Fort a la Corne. The company also took second spot on the list of percentage gainers, with a 43% increase, to close at the $2 mark.

Stikine Gold traded 2.1 million shares in the 31-to-47 range and closed at 43.5, up another 7.5, building on the previous week’s gain of more than than 35%. The company outlined the increased potential for a deeper, Sullivan-type lead-zinc deposit after hitting an important marker horizon at depth near Kimberly, B.C.

JNR Resources closed down 4, to 60. The company is teamed with International Uranium at the Moore Lake uranium project at a time when uranium prices are at 20-year highs of USA$18.50 per lb.

Posting a 40% gain was North American Tungsten, which is trying to raise $7.5 million in a private placement in order to restarting the Cantung tungsten mine on the Yukon/ Northwest Territories border. Shares in the company ended the week at 21.

Value gainers were mostly companies that managed to reverse their losses from the previous period: Shares in Silver Standard Resources rose $1.21 to close at $17 after losing about $1.09. The company is highly leveraged to the price of silver, which regained ground during the report period. Northern Dynasty regained 65 to close at $4.80 after falling by 75 in the previous week. The company is drilling its Pebble gold and copper deposit in Alaska.

Marathon PGM lost more than 31% to finish at 24. Stealth Minerals lost in excess of 28.5% in the midst of preliminary discussions with Watch Lake Resources, a private British Columbia company whose Argentine subsidiary’s properties include open-pit, bulk-minable gold prospects.