Toronto Stock Exchange New Year’s rally continues to make advances

The small gold index advance appeared technical, coming despite a decline in the price of bullion. The second London fix was $403.80 today.

The over-all market advances this month are a continuation of good gains made in December when the dollar value of trades on the TSE increased by 24% over that in November. In fact, the value of shares traded in December was up 10.5% over that in the same month in 1987.

American Barrick Resources made the biggest splash this week, announcing a one-million-oz gold loan to finance its ambitious Goldstrike expansion in Nevada. When completed, Goldstrike will be capable of producing 900,000 oz of gold per year. Barrick closed at $22, up $2.25 during the week.

Franco-Nevada also reacted to the news and traded to $8.25. Franco has a lucrative royalty on the Goldstrike mine which it tried unsuccessfully to sell last year. In addition to having a hefty price tag, the interest is a royalty and not a direct interest in the mine, something most buyers were concerned with. Nevertheless, Franco will be enjoying healthy cash flows once the expansion is completed.

Echo Bay Mines, another major North American gold producer, made a small gain to close at $16.88. The company has encountered good exploration results at a gold property in Alaska. LAC Minerals was easier, dipping 13 to $12.25.

The largest Canadian gold miner, Placer Dome Inc. was also better, adding 13 to $15.38. Newcomer to the TSE, Bond International Gold, BIG for short, perked up to $8.75. BIG, led by the dynamic Australian businessman Alan Bond, is fast becoming a major force in the gold mining industry.

Silver miner United Keno Hill Mines fell to a new low of $4.50 during the week, before recovering to $5 today. The issue was hurt by news that one of its silver mines in the Yukon is shutting down. Most base metal issues continued to hold on to recent high ground, despite a modest setback in commodity prices. Inco Ltd. was strong, trading to $31.75. Falconbridge Ltd. was also active, soaring to a new high of $28.87 earlier in the week. Today the issue was softer, closing at $27.75.

Cominco Ltd, the world’s largest zinc producer, was just a shade off its new high of $25.50, closing at $25.38. Cominco, as are all zinc mining companies, is responding to record high zinc prices which show no evidence of weakening in the short-term. Mineral Resources International was also firm, closing at $5. The company owns the Nanisivik zinc-lead mine in the Arctic.

Cassiar Mining remained strong at $5.63. The company is a copper and asbestos producer which is making money from both products. How times have changed

News that a feasibility study is being completed on the Sulphurets gold property in British Columbia had little impact on Newhawk Gold Mines. The issue slipped a dime to $3.15. Although very high grade, the deposit is located in the rugged Stewart area of northern British Columbia.

Aur Resources was quiet at $3.10, just a dime above its low of $3. Aur is involved with several potential gold producing properties in Quebec.

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