TSX ends lower, Aug. 3-7

West Texas Intermediate crude finished at US$43.84 per barrel — marking the sixth weekly drop in oil prices — but a bounce in Canadian exports in June injected a sliver of optimism into the prevailing doom and gloom about the economy. Statistics Canada reported that the trade shortfall fell to $476 million, well below the $3.4-billion deficit recorded in May. June exports rose by 6.3% — the largest month-on-month increase since a 6.9% gain in December 2006. 

On the metals front, gold stayed more or less flat, finishing at US$1,092 per oz., while prices of copper, nickel and zinc fell to 1.1%, 2.2% and 3.3%. The benchmark S&P/TSX Composite Index slid 1.2% to 14,302.70 and the S&P/TSX Capped Diversified Metals & Mining Index dropped 4.3% to 510.06. The S&P/TSX Global Mining Index lost 1.1%, falling to 52.61, while the S&P/TSX Global Gold Index edged 1.7% lower to 120.72.

Strong second-quarter results sent Semafo’s shares up 17¢ to $3.02. The West Africa-focused company’s net income jumped to US$22.1 million in the three months ended June 30, up from US$14.9 million in the same quarter last year. Second-quarter production at the company’s Mana mine in Burkina Faso totalled 66,000 oz. Total cash costs came in at US$471 per oz. sold, down 22% year-on-year, while all-in sustaining costs of US$604 per oz. marked a 16% year-on-year decrease. The lower costs came from fuel prices and exchange rates. The Montreal-based producer has lowered its 2015 total cash cost guidance from US$575 and US$605 per oz. to US$515 and US$540 per oz. Cash flow from operations reached US$40.7 million, or 14¢ per share. Semafo is on track to complete a feasibility study in the second quarter of 2016 on its Natougou deposit, also in Burkina Faso. The company expects to spend US$18 million on exploration this year.   

News that Seabridge Gold completed a pilot plant evaluation of a new process for removing selenium from water from its wholly owned KSM project in northwestern B.C. sent the company’s shares up 64¢, or 12%, to $5.93 apiece. BioteQ Environmental Technologies — an independent, Vancouver-based company — built and operated the plant using their patent-pending Selen-IX treatment technology. In doing so, Seabridge satisfied a condition of the B.C. environmental assessment certificate issued on July 30, 2014, which required Seabridge to complete the pilot plant test within one year of issuing the certificate.  

Shares of Potash Corp. of Saskatchewan fell 50¢ to $35.08. On Aug. 8, salt and fertilizer company K+S AG of Germany rejected Potash Corp.’s takeover offer for the second time, citing concerns about keeping jobs and mine sites in Germany and a low offer price. Last month, PotashCorp offered K+S €41 per share ($44.82 per share) in a deal worth €7.9 billion, or $8.6 billion.