Toronto Stock Exchange N.T. Thin volumes follow collapse of New

Just when the first vestiges of a rally appeared to be emerging, the sheer nervousness of the market stopped the fledgling advance dead in its tracks. The New Year’s four- day rally, which saw 110 pts added to the tse composite, was completely erased by the 118-pt decline of Jan 8 — a decline which reminded many of the frightful drop on the Friday preceding the Oct. 19th collapse last year.

However, the nervousness is contradictory to the general bullish economic news coming from North America. In fact, the Jan 8 tumble came on news that employment in the U.S. was at near a record low which the bears interpret as a harbinger of higher inflation this year. In other words, no recession is in sight. This thinking is supported by an analysis completed by Patricia Mohr, senior economist with the Bank of Nova Scotia.

Ms Mohr is calling for a strong and sustained period of economic activity in 1988 in Canada and the U.S. A big factor behind the improving competitive edge for Canadian goods is the depreciation realized by North American currencies.

The lack of direction was clearly evident today as the tse composite drifted 5.4 pts lower to close at 3,135.91 pts. Volume was a meagre 17.4 million shares.

Gold, which has traded in a relatively narrow range following last month’s run at $500, was quiet and steady at $481.90(US) per oz at the second London fix. The gold and silver index was marginally stronger up 3.42 pts to 7,223.27 pts at the close.

American Barrick Resources, which has run into delays sinking a shaft at its Carlin Goldstrike property — because too much ore is getting in the way — was active, trading 254,000 shares to close up a quarter at $27.25.

Buying gold reserves is still an attractive venture if financing is available. Total Resources, which bid $10 per share for all the issued stock of Getty Resources upped that bid to $11. Getty has accepted, and the issue closed at $10.88. Total was eyeing Getty’s 49% stake in the Tundra deposit in the N.W.T. Based on possible reserves outlined by Noranda, the Getty interest represents a gross in situ gold resource of 2.3 million oz.

Following a $142 million equity issued completed by Falconbridge Ltd., nickel prices dived from a high of over $4(US) per lb to the $3.50-range. The drop was not welcome news to the institutions which just paid $23.75 per Falconbridge unit. Today the common was steady at $21.38 — off $1.88 for the week. Inco Ltd., which is the world’s largest nickel miner, was better at $26.38.

Nickel prices are also being cited for the activity in the shares of New Quebec Raglan Mines. The company (see front page story) controls one of the finest undeveloped high grade nickel deposits in the world. After jumping to a high of $3.25, the issue dived back to $2.40 on very thin volume. Raglan is controlled by Falconbridge. Even at a price of $3.50 per lb of nickel, Falconbridge can’t ignore the immense potential of the deposit.

On the exploration front, last week’s activity in the shares of T & H Resources and partner Jonpol Explorations was justified following the release of a drill hole from their Garrison Twp., Ont. property. The hole cut 0.95 oz across 46 ft. True width is about 20 ft.

Today, T & H was steady at $2.14 — up 84 cents for the week. Jonpol was also better at $2.33.

A move by Belmoral Mines to buy control of Montreal-listed Yorbeau Resources did little to inspire buying of the former company. Belmoral was a little easier at $2.72.