TSX rises 1.4%; mining index up 9.5% over July 19-23

The markets were positive around the globe over the July 19-23 trading period and Toronto was no exception. The TSX composite index rose 1.4%, or 160.35 points, to 11,730. Strong economic reports in Europe added some positivity amidst some forecasts for slowing growth in North America. This was evident with mining stocks as investors pushed up base metals stocks while the gold stocks were relatively flat.

The Capped Metals & Mining index jumped 9.5%, or 83.44 points, to finish the week at 959.8, while the Global Gold index was basically unchanged at 355.19 points.

Looking at the most actively traded stocks of the week, Lundin Mining was at the top, with 27.1 million shares changing hands, giving shares a 34¢-boost to close at $3.92. The base-metals miner plans to release its second quarter earnings on July 28.

Andean Resources shares were the second most actively traded, after a busy week that included a huge $234.5-million bought deal financing led by BMO Capital Markets and RBC Capital Markets at $3.35 per share. Andean will largely use the funds to advance its Cerro Negro gold project in Santa Cruz province, Argentina. The company reported finding “bonanza-grade” mineralization at its Mariana Central vein at Cerro Negro. Highlights include 8.5 metres grading 46.1 grams gold per tonne, 9 metres of 127.1 grams gold and 14.5 metres of 55.3 grams gold.

Teck Resources was one of the top gainers by value, up $3.56 to $37 a share, and one of the most actively traded stocks, with 21.1 million shares changing hands. The company is still investigating the cause of an explosion at its Greenhills coal mine near Elkford, B.C., on June 28. The mine was supposed to produce 4.3 million tonnes of coal this year, or about 2% of world’s coal supply.

Khan Resources saw the biggest percentage jump, with shares rising 52.1% to 35¢ apiece, following a victory in a Mongolian courtroom and the postponement of another case. The court ruled that the Mongolian Nuclear Energy Agency’s decision to invalidate Khan’s mining licence on the Dornod uranium project was invalid and illegal.

Harry Winston Diamond was one of the top losers based on value, down $1.43 to close at $13 apiece. Harry announced an agreement to increase its ownership in the Diavik diamond mine, joint venture with Rio Tinto, to 40%. Kinross Gold agreed to sell its 9% indirect stake to Harry for US$220 million. Last year, when diamond prices had dropped and the Diavik mine faced uncertainty, Kinross paid US$104 million to Harry for the stake. Kinross is also selling its 19.9% stake in Harry Winston to some financial institutions, after acquiring the interest through a private placement at US$3 a share, netting about US$150 million.