Toronto Stock Exchange Golds respond to Volker’s resignation

The power associated with sitting at the helm of the Federal Reserve Board in the U.S. has always been regarded with awe. For where else can one wield such economic clout as to impact on just about every country outside of the comecon? The resignation then, of Fed chairman Paul Volker this week provided dramatic proof of the power which comes with the job. Bond and stock markets plummeted in a panic sell-off while gold bullion prices raced $12 to $456 (US). Today bullion prices retreated marginally to $453. News that Volker’s successor Alan Greenspan is a committed anti-inflationist no doubt took some of the steam out of the gold market. But the net affect of the Volker resignat ion was upside movement, which the goldbugs cheered.

Dome Mines, which is soon to disappear into a conglomerate known as Placer-Dome, edged up marginally to $19. American Barrick Resources was also stronger at $49.25. For the day, the tse gold index slipped 1.85% to 8,269.43 pts. For the week however, the overall move was up. The metals and minerals index showed surprising strength, advancing 3.63% to 2,781.96 pts.

Base metal miners such as Inco Ltd. and Falconbridge remained solid at $23.25 and $21.13 respectively. International Corona Resources, remained weak at $38.13; a long way off its 1987 high of more than $56 reached just several weeks ago. Second quarter results for the company’s fiscal year to March, 31, show income before extraordinary item, of only 4 cents per share. Including gold production from the Page- Williams mine at Hemlo (still under appeal by Lac), Corona’s earnings swell to 29 cents per share. The impact of the Page-Williams mine on Corona is obvious.

Lac Minerals, which used to own the big mine and is still waiting to hear about its appeal effort, remained steady at $44.63. Rumours on the street suggest Lac is taking a run at control of Scintilore Explorations, a junior company which also is looking to the courts to “strike gold” as one analyst quipped. Scintilore was quiet at $4.90. The junior company is claiming all the benefits and royalties held by prospectors John Larche and Don McKinnon, the original stakers of the discoveries. Some observers feel the Scintilore suit could have an impact on the appeal decision.

A strong drill hole pulled by Jonpol Explorations east of Matheson, Ont., helped move the issue to the $3.50 range. The hole cut a 24.7-ft section grading 0.42 oz gold per ton. On the platinum scene, Madeleine Mines continued to set the pace as it surged to $15 on strong volume of 147,393 shares. More than 1,000 acres have been stripped at the company’s Lac des Iles property north of Thunder Bay, Ont. Mill foundations are being constructed and machine shops and workers quarters have been erected on site. Still, no formal production decision has been made.

Heenan Senlac, a junior company which is one of the few to have ground in the Lac des Iles area, was also active trading at $1.40 on volume of more than 130,000 shares today. Consolidated TVX Mining, which is active in Brazil’s gold rush, announced an underwriting agreement with Burns Fry Ltd. which will raise the company $25.7 million.

Shareholders at the annual meeting of Queenston Gold Mines were introduced to the new control block holders, partners HSK Minerals and Joutel Resources. Queenston, which enjoyed income for the first quarter of this year of more than $120,000, firmed up to $2.65. HSK and Joutel were both steady at $1.53 and 53 cents respectively.

A month-long strike at the Chibougamau, Que., gold-copper mines of Northgate Exploration has ended with the union accepting a new three-year agreement. Northgate, which could have been seriously hurt by a lengthy walkout, was firm at $10.75.