STOCK MARKETS — Bond selloff results in modest TSE gain

A bond selloff late in the week held the Toronto Stock Exchange to a modest gain during the 5-day report period ended March 21. The composite 300 index rose 55.65 points to close at 4,246.19.

The selloff prompted equity investors to jettison some of their stock holdings, putting an end to a 12-day winning trend on the Toronto markets. Despite a stronger Canadian dollar, the Bank of Canada rate remained unchanged from last week’s setting of 8.4%. The dollar closed the week at US71.33 cents, up more than half a cent.

Gold lost some of its glitter during the week, with the London afternoon fix on March 22 set at US$382.25 per oz., a loss of US$3.90. The falling bullion price held the gold and precious metals subgroup to a gain of 119.37 points, closing at 9543.11.

Senior gold producers were higher on the week, with Barrick Gold gaining 50 cents to $33.13, Hemlo Gold Mines tacking on 13 cents to $13.50 and Placer Dome adding 63 cents to close at $31.63.

Denver-based Echo Bay Mines has struck a deal that will see the company increase its equity interest in Etruscan Enterprises to 15%. It has also taken an option on acquiring a 44% stake in the Koma Bangou gold deposit in Niger from Etruscan. The junior is earning a 67% interest in Koma Bangou, which has drill-indicated reserves of 10.3 million tonnes averaging 2.47 grams gold per tonne to a depth of 71 metres. Echo Bay shed 13 cents, to close at $13.75

Montana sapphire producer American Gem has agreed to purchase rough sapphires from Great Northern Mining Corp., one of Australia’s largest miners of gemstones. Under the deal, American Gem can buy half of Great Northern’s monthly production from its Queensland operation. American Gem’s share of 1995 production is estimated at 3 million carats. This figure is expected to increase to around 9 million carats per year during the next three years. Despite the new deal, American Gem shares lost 50 cents to close at $3. Partners Great Lakes Minerals and Hecla Mining report that the District Court of Idaho has issued an order dissolving its January injunction over certain timber, grazing, road-building and mining projects in six national forests in Idaho. With the injunction dissolved, the partners’ Grouse Creek mine is now free to operate unencumbered. Hecla has an 80% interest in the gold deposit, with Great Lakes holding the balance. Great Lakes ended the week unchanged at $1.69.

Montreal-listed KWG Resources signed a deal with a Haitian company to acquire a 50% interest in two gold properties in northern Haiti for US$3 million. One of the deposits, Grand Bois, has proven reserves of 4.4 million tonnes grading 2.7 grams gold and 16.5 grams silver per tonne. The other deposit, known as Morne Bossa, contains proven reserves of 3.3 million tons at 2.3 grams gold. KWG was unchanged at $3.45.

With negotiations now complete, Lyon Lake Minerals will more than double the size of its Costa Rican land position and add a second gold deposit to its portfolio. Lyon Lake has acquired a 2,000-hectare concession adjoining the Beta Vargas concession. In addition to covering the extension of the structure that hosts the Beta Vargas deposit, the new land package includes another potentially open-pit gold deposit 3.2 km north of the Beta Vargas structure. The new deposit has reserves containing 3.6 million grams (116,000 oz.). Lyon Lake shares added 3 cents to end at 29 cents.

Positive preliminary drill results from an eastern geophysical anomaly on Diamond Fields Resources’ Voisey Bay project in Labrador failed to inspire market participants. Two drill holes cut significant intervals of disseminated and semi-massive sulphides within a troctolitic intrusion similar to the original find. The size and shape of the discovery are not yet understood, and will be defined with additional drilling. Diamond Fields shares dropped $1, to close at $22.38.