Toronto Stock Exchange Mixed economic signals keep investors at bay

Mixed signals concerning the direction of inflation and the prospects for a recession are keeping investors cautious. The metals and minerals index managed a 22.59-pt gain to 3332.05 pts whereas gold and silver continued sluggish, dipping to a new low of 5243.36 pts — off 17.47 pts.

Gold bullion prices on the second London fix were unchanged at $377.20. With the possibility for more weakness in gold, especially with a stronger U.S. dollar, gold shares remain shunned by most players.

Agnico-Eagle Mines managed to get to $9.88 after trading to a new low of $9.50 earlier in the week. The company has created a new gold exploration company with Hecla Mining Co., a U.S. firm. Named Lucky Eagle Mines, the new entity will explore a large portfolio of properties which were pooled by Hecla and Agnico.

St. Genevieve Resources was back trading after a long cease trade order was lifted. The issue was firm at $1.08. St. Genevieve was halted after assaying discrepancies were found at the company’s tailings recovery project at the Louvem mine in Quebec. A new study by two independent firms concludes that more work will be required to determine the actual grade of the tailings.

Major gold mining companies are generally unchanged. Hemlo Gold Mines, Canada’s lowest-cost producer, was better at $12.75. American Barrick Resources, which is getting better than expected results from its Carlin operations in Nevada, also advanced to close at $24.

Placer Dome Inc. was easier at $14.38. A new discovery at Rouyn Resources’ Francoeur project in Quebec, failed to generate much interest. The issue was off a nickel to $1.75, a new low. The new zone, which was discovered by drilling from the No 6 shaft, averages 18 ft in width and grades 0.26 oz gold per ton. After 200 ft of drifting and raising was completed, grades improved to 0.3 oz. A reserve estimate is under way. LAC Minerals, which has a 50% interest in the Francoeur mine, was also weaker, closing at $11.25.

Cominco Ltd. was firm at $24.88. It’s big Red Dog mine in Alaska is expected to begin producing zinc concentrates by year-end. Cassiar Mining, which produces asbestos and copper, was weaker at $4.75.

Pine Point Mines, which is controlled by Cominco and owns a piece of the rich Polaris zinc mine in the Arctic, was a winner adding a $1.25 this week to $31.50. The issue slipped back to $31 today.

Geddes Resources managed to keep a winning streak alive, adding another 6 cents to close at $1.56. The company’s remote Windy Craggy copper deposit is looking more attractive in light of currently high copper prices. The company also has the financial backing of Northgate Exploration, its major shareholder.

Inco Ltd. and Falconbridge Ltd. were both actively traded. More than 200,000 Falconbridge shares exchanged hands, leaving the issue slightly higher at $30.88. Inco, which gained a dollar to $36.75, saw more than 100,000 shares traded.

St Andrew Goldfields plans to begin gold production at its mine near Timmins, Ont., this summer. Last-quarter output is forecast at 4,000 oz, the company says. The issue was unchanged at $2, its low.

St Andrew’s sister company, Bachelor Lake Gold Mines didn’t trade today. The previous day’s close was 80 cents . Bachelor Lake operates a high-cost gold mine in Quebec, which at current gold prices, is a money-losing venture.

Galactic Resources was quiet at $3.80, just a nickel above its low. The company is a turnaround play as a result of excellent results from its 48%-owned Ridgeway gold mine in South Carolina.

Metall Mining, which recently purchased a large copper operation in the U.S., was also steady staying unchanged at $11.75. The company is cash-rich and operates base metals projects in several countries.

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