TSX rises, July 10-14

Canada’s central bank raised its overnight lending rate by a quarter-percentage-point to 0.75% from 0.5%–the first interest rate hike in seven years. “Growth is broadening across industries and regions and therefore becoming more sustainable,” the Bank of Canada explained in a statement. The S&P/TSX Composite index rose 0.98% to 15,174.81 and the S&P/TSX Global Mining Index advanced 3.06% to 63.63. Spot gold climbed 1.34% to US$1,228.40 per oz., lifting the S&P/TSX Global Gold Index by 1.38% to 188.35.

Shares of Richmont Mines rose 90¢ to $9.73 on the back of strong second-quarter results.  The company produced 31,249 ounces of gold during the quarter, of which 26,110 ounces came from the Island gold mine in Ontario, for revenues of $59.3 million. Richmont said it is well positioned to achieve or exceed the high-end of its production guidance this year of 87,000-03,000 oz. gold. Cash costs company-wide during the quarter came in at $725 (US$539) per oz., positively impacted by record low cash costs of $580 (US$431) per oz. at the Island mine. In addition, Richmont reported underground mine productivity of 1,148 tonnes per day, exceeding its target set for late 2018 of 1,100 tonnes per day. Richmont also produces gold from the Beaufor mine in Quebec.

Drill results from its Colomac project in the Northwest Territories drove up the shares of Nighthawk Gold by 31.9% to 91¢. The junior released assays from nine holes that expanded the mineralization at the high-grade Zone 1.5 an additional 90 metres to a vertical depth of 350 metres and extended the zone 25 metres to the north along strike. The zone, which outcrops at surface, remains open to depth and along strike.

Problems at the processing plant at TMAC Resources’ Hope Bay project in Nunavut sent the company’s shares down $1.10 to $13.65. The company reported at the end of the trading week that the ramp up continues to be slower than expected and has resulted in less than budgeted cash flow. Underground development at Doris North and Doris North BTD continues as planned, TMAC said, but the daily mining rate at Doris North remains less than planned due to the reduced number of tonnes being fed into the processing plant and the large stockpile of ore remaining on surface. As at June 30, the surface stockpile consisted of 105,000 tonnes at 15.2 grams per tonne containing 51,000 oz. gold.  Recoveries have been lower than expected too, due to challenges including design issues and mechanical failure. TMAC also announced that it has entered into a revised credit facility providing an extra US$30 million and delaying principal repayments from July 2017 until October 2018. The Doris mine poured its first gold in the first quarter of 2017 and achieved commercial production in the second quarter of the year.