Toronto Stock Exchange Short positions show pessimism in base

Falconbridge was the most active issue this week trading more than 1.3 million shares and picking up an eighth to close at $23 1/8. Falconbridge Chairman William James was in the Dominican Republic recently for negotiations with the government. An export tax has been imposed on Falconbridge subsidiary’s exports of ferronickel and, as a result, Falconbridge has closed the operation. With nickel prices high — partly bcause of the Falcondo shutdown — both the government and the company are anxious to get things going again.

Inco continues to trade heavily near its 12-month high with 796,700 shares changing hands this week, but Inco’s price fell by 75 cents to close at $35 3/8.

While base metal prices are flying high, some of the professional traders seem to have a more pessimistic view of what the future holds. Short positions as of mid-April on Falconbridge and Inco were both up markedly, as was Cominco’s. Short positions on Noranda, however, were down.

Cominco was up $ 5/8 on the week closing at $20 1/2 on volume of 629,300. Noranda was down 50 cents to close at $22 1/4 on 1,136,600 shares — the second heaviest trader during the week.

The metals and minerals index was virtually unchanged all week — until today. It dropped 50.6 points — 1.79% — to close at 2,776 compared to 2,822.65 a week ago. It’s still not far off its 1988 high of 2,877.47, however, and well above its year low of 2238.67.

Granges managed a significant comeback this week after slipping last week on news of major problems at its Tartan Lake joint venture gold mine in Manitoba. There’s a lot of support for Granges in Europe, but the stock was also bolstered by some good news from its joint venture with VSE-listed Windflower Mining near Camborne, B.C. There have been some high grade gold values from early drilling on the property over signficant widths.

On the other hand, Granges’ partner at Tartan Lake, Abermin, continued to slip ending the week down 17 cents at 52 cents after touching a 12-month low of 46 cents .

Senior gold stocks did not fare well this week. The gold price in London was weaker with the morning fix today at $441.95 and the afternoon fix at $443.25.

The gold index declined steadily during the week closing today at 6,464.72 compared to 6,690.64 a week ago, a 225.92-pt decline.

Among senior gold issues, American Barrick lost $1 1/8 on 422,400 shares to close at $24 3/8, Placer Dome was off $ 1/8 to close at $16 1/8 on 684,500 shares, Lac Minerals was up 25 cents to close at $14 1/2 on 576,600 shares, Hemlo Gold Mines was up $ 1/8 to $15 1/4 on 323,000 shares and International Corona was unchanged at $9 3/4 on 332,900 shares.

Neptune Resources managed a 10 cents increase to close at $4.15 on 24,100 shares. The company was the subject of a CBC Television commentary recently which chronicled President Peggy Witte’s efforts to raise the money needed to put Neptune’s Colomac gold deposit in the Northwest Territories into production. In a slow market, raising the money is proving to be a daunting task.

Canamax Resources and Pacific Trans-Ocean enjoyed a spate of publicity recently, too, as they poured the first gold from their Ketza River mine in the Yukon Territory. Canamax was up 25 cents to close at $7.50 on 29,700 shares while Pacific Trans was down 4 cents to close at $3.70 on 202,600 shares.

Consolidated TVX was the innocent victim of an announcement by the Brazilian government that it plans to restrict activities of foreign- controlled mining companies. TVX is a major gold producer in Brazil, but it already meets the requirements of the new policy. Nevertheless, TVX tumbled by $ 3/8 to close at $7 1/2 on 226,600 shares.

Scintilore gained 30 cents on the week to close at $4.90 on 153,700 shares. A lawsuit had been filed against the company in the Suprme Court of Ontario by prospector Donald McKinnon last fall alleging that Scintilore had defamed his character, but Scintilore says it was never served the writ and so the claim has expired. Scintilore is suing in the Ontario Supreme Court for some of the Hemlo royalties.