STOCK MARKETS — TSE rises as Canadian dollar hits 4-month

The recent rally by the Canadian dollar helped inspire investor confidence, which led the Toronto Stock Exchange to post a slight gain during the 5-day report period ended April 11. The composite 300 index rose 23.22 points to close at 4,274.98.

The currency rally has been attributed to turmoil in the Quebec separatist ranks, and to the U.S. dollar’s minor rebound against the Japanese yen and German mark.

Despite a stronger Canadian dollar, the Bank of Canada rate fell only 24 basis points, to 8.3% from 8.54%. The dollar closed the week at US72.31 cents, up just over half a cent.

Gold lost ground during the week, with the London afternoon fix on April 12 set at US$390.05 per oz., a loss of US$2. The falling bullion price held the gold and precious metals subgroup to a gain of only 14.3 points, closing at 10,031.82.

Senior gold producers were mixed on the week, with Barrick Gold losing 13 cents to $34.13; Echo Bay Mines dropping 13 cents to $14.37; and Hemlo Gold Mines tacking on 63 cents to $15.50.

Placer Dome has agreed to invest US$80 million to acquire a 27% interest in a gold property in Kazakhstan. Previous work at the Vasilkovskoye project outlined a potentially open-pit deposit containing 138 million tonnes averaging 3.03 grams gold per tonne.

Meanwhile, Placer officially offered US$425 million for all the outstanding shares of International Musto Explorations by mailing its tender offer to all Musto shareholders. Shares of the senior company shed 13 cents to close at $32.39, while Musto shares gained 25 cents and closed at $12.88. News of a deal enabling Imperial Metals to proceed with development of the Mount Polley copper-gold project in British Columbia failed to impress market participants. Imperial agreed to sell a 35% stake in the project to a Japanese-based company for $85 million. Once operational, the project is expected to yield 15,900 tonnes of copper and more than 3.7 million grams gold annually. Imperial Metals ended the week at $1.33, down 7 cents. With permits in hand, Azco Mining is considering how best to secure financing for its Sanchez open-pit copper mine in southeastern Arizona. The company might sell an interest in the project, or, alternatively, merge with another company. Shares of Azco added 27 cents to end at $3.

Brazilian explorer Santa Elina Gold has identified several geochemical and geophysical anomalies on its 14,000-hectare Fazenda Nova concession. These anomalies are being drill-tested, and early results have assayed as high as 12.75 grams over 1.8 metres. Shares of Santa Elina were unchanged at $1.50. A geophysical survey completed by Diamond Fields Resources has defined another anomaly, termed the Zorba target, 4.5 km northwest of the Voisey Bay deposit. In addition, airborne geophysical results indicate that the geophysical anomaly coincident with the Voisey Bay deposit has a strike length exceeding 7 km. News of the discovery and of the preliminary airborne results caused Diamond Fields’ share price to jump $2.63 to end the week at $27.75.

Metallica Resources has bought a Mexican corporation with interests in several properties within the historic Cerro San Pedro mining district. The CDN-listed junior plans to spend $1.7 million to explore the 25 concessions, which comprise 1,600 hectares. The program will focus on defining gold mineralization overlying a porphyry along a structural corridor. Shares of Metallica closed at 71 cents, down 2 cents from the previous week. Meanwhile, in Bolivia, Cominco Resources International and Vancouver-listed Rio Amerillo are drilling the Chachacomiri silver project. So far, the companies have drilled two holes and received encouraging results. The first hole intersected 52 metres which averaged 68 grams silver per tonne, 1.9% zinc, 1% lead and 0.2% tin, while the second intersected low-grade mineralization. Cominco Resources shares were unchanged at $3.65.