Strong metal markets drive up broad market

Strong performances by metal markets helped push up the Toronto Stock Exchange 300 index during the Jan. 5-11 report period. The index rose 240 points to 8,442.61. Meanwhile, the metals and minerals sub-group advanced 200 points to 4,714.51, while the gold and precious metals sub-index edged ahead 29.22 points to 4,823.

Gold rebounded slightly, rising 15 to land at a London morning fix of US$282.25 per oz. on the morning of Jan. 12. The yellow metal was joined by palladium, which regained $12 to end at US$450 per oz. Platinum and silver each lost ground.

Two of Canada’s three major producers enjoyed gains, with Barrick Gold up 15 to $25.60 and Placer Dome up 20 to $15.15; Kinross Gold went the opposite way, down 12 to $2.46.

Cambior climbed 4 to $1.74 on news of encouraging results from preliminary drilling at its Santo Nino gold-silver project in Mexico. The company preceded this in late December 1999 by inking a restructuring deal with its lenders and hedge providers, bringing to a close a 3-month standstill that began after it racked up more than US$33 million in heading losses when gold briefly spiked in early October.

Agnico-Eagle Mines rose 20 to $10.30. The company released impressive results from underground and deep drilling at its Laronde gold mine in northwestern Quebec, where Zone 40 North was intersected nearly 3 km below surface. Drilling has confirmed the zone’s continuity over a strike length of 457 metres and a true thickness ranging from 10 to 19.5 metres.

North American Palladium tanked $1.40 to $5.60 despite having released a positive feasibility study on a proposed expansion at its Lac des les palladium mine, near Thunder Bay, Ont. The independent study concluded that daily production rates could be boosted to 15,000 tonnes from the current 2,400 tonnes, albeit at the hefty price of US$126.5 million. North American is now seeking financing and environmental permits.

Nickel closed down 6 to US$3.69 per lb., whereas copper rose a penny to US83 per lb. Lead and zinc both stayed the course at US22 and US54 per lb., respectively.

Inco climbed 10 during the report period to $34.60 but fell back $2.30 on Jan. 12 after announcing it would not be moving forward this year at its Voisey’s Bay nickel-copper-cobalt project in Labrador. The major’s latest proposal — construction of a $750-million mine-and-mill complex in Labrador, along with a $180-million hydrometallurgical pilot plant — was rejected by provincial authorities.

Junior Western Copper Holdings sank 28 to $1.45 after releasing mixed results from its San Jeronimo project in Mexico. Four holes cut “massive-sulphide-style” and “vein-style” silver-lead-zinc mineralization, with hole 3 returning the best result of 38.1 metres grading 119.7 grams silver per tonne, plus 0.72% lead and 1.24% zinc.