Vancouver Stock Exchange Gold firms as market hibernates

With spring officially here you’d think the market would come out of hibernation but it hasn’t. Realistically, however, there’s no good reason why it should. Although gold prices have firmed lately, North American interest rates are still relatively high; and inflation has also shown signs of waning, which is bad news for gold.

Our dollar recently broke 80 cents (US), another negative for commodity producers, particularly gold miners. Cynics conclude that Canada’s interest rate policy is designed to strengthen our dollar to speed passage of the Free Trade Pact with the U.S. As usual it’s commodity producers that are paying the shot.

By press time today the market index was up 2.1 points to 1,093.1 and declining issues were slightly ahead of advances. Goldbelt Mines was ahead 15 cents to $1.20 and Rex Silver shot up 5 cents to $1.40. Other movers included: Sutton Resources, 25 cents better at $2.55, and Central Crude, 12 cents stronger at $2.31.

Over our report period, Colossus Resource Equities posted a $1 increase to $4.40, obviously a reaction to its takeover offer for 51% of Delaware Resources Corp which was ahead 87 cents to $10. Delaware has rejected the offer as being “substantially below the market value of the shares.”

Understanding what exactly Colossus is offering for Delaware is difficult and some shareholders have expressed reservations about it being only for 51%. Takeovers and mergers have become a feature on the Vancouver scene lately much like they have on some larger markets. Pioneer Metals has announced plans to merge with Silbak Premier Mines which it already controls. (No surprise here.) Silbak A shares were ahead 40 cents to $2.60 and Pioneer was steady at $10.

Arakis Mining climbed $1.15 to $2.80 during the week, reflecting its takeover bid for Pacific Rim Container Sales. No doubt we can expect a name change for this one in the future. Many of these stocks get listed as mining companies then switch businesses — often to the chagrin of shareholders who wanted to invest in a mining venture.

Also posting a respectable showing was H.Q. Minerals which closed the week 44 cents higher at 94 cents . The company has encountered several intersections of massive magnetite and chalcopyrite at its Lasqueti Island property in British Columbia. Assay results are pending.

Skukum Ventures, which has agreed to finance Omni Resources Skukum Creek property to production for a 40% interest, was ahead 40 cents to $3.40. Omni gained a nickel (which at current lme prices is probably worth a dime), to $2.90.

Hollycroft Resource Corp. was the volume leader with a turnover of approximately 2.1 million shares. It was ahead 1 cents to 16 cents . The company recently raised money to explore its McQuillan claim on Vancouver Island.