STOCK MARKETS — Strengthening gold sector gives boost to

A strengthening gold sector helped the Toronto Stock Exchange post a modest gain over the 5-day report period ended Sept. 20. The composite 300 index moved up 32.65 points to end the period at 4,376.87.

The gold and precious metals sector moved up sharply, closing the week at 10,667.40 — a gain of 340.75 points over the period.

Gold bullion also advanced, with the London afternoon gold fix on Sept. 21 set at US$394.90 — up US$4.60 from a week ago.

Many market analysts believe the rise in gold prices is linked to the weak U.S. dollar, unexpectedly poor U.S. trade figures and renewed fears of inflation.

Now that Quebec separation fears have subsided, the Canadian dollar continues to be a strong performer, gaining a half-cent to close at US74.56 cents. Despite the surge in the dollar, the Bank of Canada rate fell a modest seven basis points to 5.64% — well below the decrease that many expected. The stronger gold price helped most senior producers to move higher on the week, with Placer Dome posting a gain of $1 to $33, Hemlo Gold Mines was up 38 cents to $15.13, Lac Minerals tacked on 75 cents to close at $16.88 and American Barrick Resources was the big winner, adding $1.38 to $34.63. American Barrick recently announced that it had acquired more than 90% of Lac’s common shares following its takeover bid, launched earlier this summer. The Barrick offer has now expired, and the company plans to exercise its right under Ontario law to acquire all the remaining shares of Lac. Many of the junior gold issues also surged. TVX Gold, which traded in excess of 5.8 million shares, was up 38 cents to $9.50; Royal Oak Mines gained 13 cents to $5.88; and Kinross Gold added 50 cents to close at $7.50.

The recent announcement by Hecla Mining of spectacular high-grade gold intersections at its Grouse Creek gold deposit in Idaho helped junior partner Great Lakes Minerals post a 19 cents gain on the week. The issue closed at $2.14 on a volume of just over 2 million. Rumor has it that Hecla expects to put the deposit into production by mid-October.

African explorer International Gold Resources (IGR) announced that its subsidiary has entered a mining lease and option agreement concerning the Ouray gold property. IGR will sell its interest to Sunshine Mining for $43 million. IGR’s stock gained 20 cents to close at $4.30.

Cominco Resources jumped 30 cents on the week to $3.55. The company recently encountered encouraging drill results on its jointly owned Saray gold property in northeast Turkey. Assays from the first eight holes of an 18-hole program averaged 1.07 grams gold per tonne over widths ranging from 47 to 125 metres. Project partner Cominco also moved higher on the week, closing up 38 cents to $24.38.

Encouraging results from a drill program by Platinova A/S, at its Peary Land zinc project in northeastern Greenland, did little to move the stock. Platinova has outlined a resource of 12 million tonnes averaging 8% zinc and 1% lead. This includes a higher-grade zone of 5 million tonnes averaging 12% zinc and 1% lead. Additional areas remain to be tested and the company will complete closely spaced drilling to upgrade the resource to a formal ore reserve. Shares of Platinova closed unchanged at $2.90.

Minera Rayrock announced that copper production has started at its wholly owned Ivan copper project in northern Chile. Minera expects to produce 22 million lb. copper annually at an average cost of US54 cents per lb. for the first five years. Reserves at the project stand at 4.7 million tonnes averaging 2.5% copper. Minera shares jumped 30 cents to close at $2.55.