Market news

Toronto Stock Exchange

The S&P/TSX Composite Index closed down 81.95 points at 12,643.82 in a period that saw gold plunge over US$96 per oz. at one point before ending at US$1,712.40 per oz. The gold price dropped from US$1,788 per oz., the highest level since November, to as low as $1,691.60 per oz. after Ben Bernanke gave no indication that the U.S Federal Reserve would start new quantitative easing.

Needless to say the S&P/TSX Global Gold Index was down, though only 15.85 points to 369.82 — the significant price drop in the period puts gold just slightly lower than it was in mid-February. The S&P/TSX Capped Diversified Metals and Mining Index fell 28.95 points to 1,179.73 points.

Pretium Resources hit an all-time high of $18.15 before ending at $17.92, up $1.12. The company built on gains from the week before after it released an updated scoping study on its Brucejack project outlining a US$1.45-billion net present value at a 5% discount rate and 25% internal rate of return, both after-tax and based on US$1,100 per oz. gold. Pretium announced a 24,000-metre infill drill program at Brucejack as it works towards a feasibility study, and closed a $23.1-million financing at $18.50 per flow-through share.

Little-traded Ursa Major Minerals managed the highest percent gain after announcing an all-share merger with Venture-listed Prophecy Platinum, jumping from 5.5¢ to 12.5¢ for a 127% gain. The deal has Ursa Major shareholders receiving one Prophecy share for every 25 Ursa shares held. Based on share prices the day before the deal was announced, this represents 15¢ per Ursa share. Prophecy holds the sizeable Wellgreen polymetallic deposit in southwest Yukon and a nickel-platinum project in Manitoba, while Ursa holds the Shakespeare platinum-group-nickel-copper mine near Sudbury, where it has suspended production.

Eldorado Gold was the most traded stock on the TSX with 38.5 million shares traded following the release of its annual results in the previous week. The company reported US$318.7 million in profits attributable to shareholders for 2011 after selling 659,000 oz. gold at an average operating cost of US$405 per oz. Eldorado also just completed its acquisition of European Goldfields. The activity saw the company’s stock price rise as much as 44¢ during the week, but it ended down 42¢ at $14.63.

Cline Mining was the second highest-traded company with 20.5 million shares traded, though like Eldorado its share price ended down. The company released its 2011 annual results, reporting comprehensive income of $11 million, and warned that coal prices continue to weaken. Cline stated that the benchmark price for Australian coking coal was US$320 per tonne in April 2011, and this April it expects US$210 per tonne. After rallying 20¢ the day before the news, Cline’s share price dropped 30¢ on the results and ended down 19¢ at $1.72.

TSX most active issues

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Eldorado GoldELD3853615.5614.6314.63-0.42

Cline MngCMK205362.071.701.72-0.19

Uranium OneUUU177783.453.113.14-0.20

Lake Shore GldLSG175881.721.501.50-0.12

Kinross GoldK1669411.4710.7110.78-0.40

Barrick GoldABX1551249.4446.6146.87-1.83

Osisko MngOSK1519512.8312.2712.65+0.11

GoldcorpG1391150.1747.5048.57-0.07

Lundin MngLUN129665.274.985.01-0.21

IAMGold CorpIMG1279315.9014.4814.53-1.37

TSX greatest percentage change

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Ursa Major MinUMJ86090.150.050.12+100.0

Velocity MinlsVLC810.190.100.19+72.7

Alexis MinlsAMC121940.080.060.07+40.0

Redzone ResREZ260.460.400.46+31.4

Marengo MngMRN7960.300.250.30+30.4

PC GoldPKL23110.420.320.35+25.0

Grandview GldGVX540.050.040.05+25.0

Starcore Int VSAM26520.390.320.39+21.8

Aeroquest IntlAQL2450.130.100.13+18.1

Forsys MetalsFSY9451.140.871.04+18.1

NoventaNTA3870.280.160.18-35.7

EMC MetalsEMC28480.160.100.10-33.3

Azumah ResAZR560.350.330.35-31.3

Shore GoldSGF67770.440.200.31-29.5

XinergyXRG7532.501.611.80-26.8

Thompson CreekTCM69198.837.017.19-18.5

Guyana GldfldsGUY48396.745.375.52-18.2

Homeland EnrgyHEG3690.050.050.05-16.6

Golden MnlsAUM2389.307.737.79-16.0

Richmont MinesRIC177512.069.769.98-15.7

TSX greatest value change

WEEK

VOLUMECLOSECHANGE

Tahoe ResTHO172831621.50+1.38

Pretium ResPVG307950217.92+1.12

AgriumAGU356651784.40+0.74

Mag SilverMAG126195610.19+0.69

Horizns G BearHGD33486188.65+0.61

Ivanhoe MinesIVN558440518.09+0.57

Major DrillingMDI206072718.23+0.48

Harry WinstonHW59838913.92+0.42

Mountain ProvMPV2176775.14+0.39

AuRico GoldAUQ63086459.98+0.38

Walter EnergyWLT2258962.60-4.25

Inmet MiningIMN164853065.27-3.23

Centerra GoldCG246114918.72-2.71

Royal GoldRGL2788068.99-2.64

Teck ATCKA1106639.80-2.50

Central Gold-TGTU_U2053165.02-2.32

Seabridge GoldSEA11032922.86-2.22

Teck BTCKB929783138.52-2.14

Allied NevadaANV183358433.56-1.94

Richmont MinesRIC17754089.98-1.87

TSX Venture Exchange

The S&P/TSX Venture Composite Index remained relatively flat during the Feb. 27 to March 2 trading period, dropping 10.62 points to close the week at 1,678.90 on average trade volumes of 120 million shares per day. Values fluctuated mid-week on volumes in excess of 130 million shares per session as gold suffered its largest weekly loss since December, dropping US$96 per oz. before closing the week at US$1,712.40. Oil prices declined to US$106.70 per barrel.

Batero Gold fell 53% on a 19.6-million share volume after a disappointing initial resource estimate at its Batero-Quinchia project in Colombia underwhelmed investors. Company shares dropped from a $2.56 high to a $1.15 close and eliminated over 50% of a $120-million market capitalization, which stands at $59.2 million.

La Ronge Gold powered its way to a 46¢ gain, closing at 80¢ to end the week on an 11-million-share trade volume. The company enjoyed market enthusiasm fueled by first assays from their Preview SW property in Saskatchewan. Result highlights include 214 metres carrying 1.63 grams gold per tonne starting from 11 metres depth, and 3 metres averaging 21.7 grams gold from 46 metres.

Woulfe Mining jumped 8¢ following a $35-million investment by International Metalworking Companies (IMC) in its Sangdong tungsten mine in South Korea. Warren Buffet’s Berkshire Hathaway owns an 80% stake in Iscar Metalworking, fueling investor speculation that the major fund player may be optimistic about the venture. The news heightened trader interest in Vancouver-based Woulfe, with 11.4 million shares changing hands through the week.

Avino Silver and Gold Mines jumped 8.9% and closed at $2.28 on 3.8-million share trade volumes following positive news on its Avino silver mine in Mexico’s Sierra Madres. The company shut down mine operations in 2001 owing to weak silver prices. Avino announced an agreement last week with the privately held Minerales de Avino. The company is applying for licences to expand production, upgrade existing mill infrastructure and bring back the mine’s full capacity of 1,250 tonnes per day.

Trelawney Mining and Exploration saw share prices sink 21% on trade volum
e of 1.2 million shares. The company closed at $2.35 to end the week. A Feb. 24 resource estimate at the Côté Lake gold deposit on the Chester property near Gogama, Ont., reported a 10% drop in grade, triggering a decline in market enthusiasm.

Verde Potash shares increased 36¢ this week on trade volume of 5.2 million shares after an updated preliminary economic assessment for its Cerrado Verde project in Brazil. Total capital expenditures are projected at US$2.3 billion. The mine would carry a 27% internal rate of return, and an after-tax net present value of US$3.4 billion with a 10% discount rate.

TSX-V most active issues

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Batero GoldBAT195932.451.051.20-1.36

Aurcana CorpAUN160751.070.961.00+0.03

Sandstorm GldSSL141651.821.621.77+0.08

Sandstorm Mt&ESND126590.460.430.46+0.02

Encanto PotashEPO125500.460.370.39-0.04

Trelawney M&ExTRR120222.802.052.36-0.62

Woulfe MngWOF114610.410.310.35+0.08

La Ronge GoldLAR110861.010.340.80+0.40

Eagle Hill ExpEAG93240.220.140.17+0.02

Encore Ren ResEZ89500.040.030.03+0.01

TSX-V greatest percentage change

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Q-Gold ResQGR870.400.020.32+966.6

Rocmec MiningRMI7360.250.090.19+111.1

La Ronge GoldLAR110861.010.340.80+100.0

Killdeer MnlsKMI2140.100.050.08+100.0

Dot ResDOT1910.050.040.05+66.6

Falkirk ResFLK530.100.080.10+66.6

Volcanic MtlsVOL6340.130.060.13+62.5

Pac Arc ResPAV3870.150.100.14+55.5

Dolly Varden RDLV370.470.380.47+51.6

Encore Ren ResEZ89500.040.030.03+50.0

Batero GoldBAT195932.451.051.20-53.1

Petromin ResPTR1090.060.040.05-37.5

Sable ResSAE110.100.100.10-33.3

Actus MnlsAAC870.050.040.04-33.3

Canuc ResCDA790.140.100.10-28.5

Central ResCBC310.100.080.08-27.2

IEMR ResIRI2120.090.080.08-27.2

Teuton ResTUO16470.620.350.41-26.7

E-Energy VentEEV1810.030.030.03-25.0

Orofino MnlsORR1140.190.150.15-25.0

TSX-V greatest value change

WEEK

VOLUMECLOSECHANGE

Great Quest MeGQ2689003.09+0.50

La Ronge GoldLAR110859020.80+0.40

Avino SilverASM3803212.30+0.39

Verde PotashNPK5215137.21+0.36

Q-Gold ResQGR870490.32+0.29

Giyani GoldWDG6838481.69+0.28

Luna GoldLGC7856893.30+0.24

Yellowhead MngYMI12375521.31+0.23

RoxgoldROG19421992.10+0.16

Dolly Varden RDLV366000.47+0.16

Batero GoldBAT195928561.20-1.36

Prophecy PlatNKL7216033.39-0.65

Trelawney M&ExTRR120216062.36-0.62

Tasman MetalsTSM6302472.13-0.47

Chesapeake GldCKG3638019.56-0.36

Gold CanyonGCU39991142.16-0.30

Probe MinesPRB4825161.89-0.26

Midway GoldMDW1277501.67-0.23

Anfield NickelANF2699804.07-0.22

Loncor ResLN355001.50-0.20

U.S. MARKETS

U.S. markets were fairly flat despite the G20 rejecting calls to fund Euro bailout funds, the International Monetary Fund warning that the global economy is still at risk of a slowdown and both U.S. housing prices and durable goods sales coming in lower than expected. The Dow Jones Industrial Average closed over the 1,300-point threshold on one day and traded as high as 13,046.86, though it ultimately ended at 12,976.82, down 6.12 points. The S&P 500 Index continued its strong climb, closing up 3.84 points at 1,369.63 to squeeze past 2011 highs and reach a level not seen since mid-2008.

Freeport-McMoRan Copper & Gold dropped US$3.31 to US$40.60 on 81.3 million shares traded as it reported continued problems at its Grasberg mine in Papua New Guinea. Violence between union and non-union workers forced the company to close the mine as wage issues simmer. The latest uprising follows a three-month strike that ended in mid-December, in which some 8,000 workers went on strike but 14,000 non-union workers continued working.

Fertilizer maker Agrium was the highest value gainer, up US$1.54 to US$85.23 after announcing it began work on expanding capacity at its Advanced Technologies facility in Missouri. The company is adding 136,000 tonnes of ESN production to bring annual capacity to 246,000 tonnes. ESN is an Agrium-trademarked product consisting of a urea granule covered by a flexible, micro-thin polymer coating that time-releases nutrients based on temperature.

Ivanhoe Mines climbed US74¢ to US$18.25 after releasing a feasibility study on its Kyzyl gold project in Kazakhstan and updated progress on Oyu Tolgoi. The Kyzyl study estimates probable reserves of 22.2 million tonnes grading 8.06 grams gold per tonne for 5.76 million contained oz. gold, and a 15-year mine life producing 337,000 oz. gold annually. The study estimates an after-tax net present value of US$878-million with a 5% discount rate based on US$1,250 per oz. gold. Ivanhoe also reported the first phase of the Oyu Tolgoi copper-gold mine is 73% complete, with initial production expected later this year.

U.S. most active issues

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Alcoa*AA10079010.5010.1510.24-0.19

Freeport McMo*FCX8126244.2341.0742.03-1.88

Alpha Nat Res*ANR5952720.2717.3317.40-3.06

Kinross Gold*KGC3889311.5710.8410.92-0.27

Hecla Mining*HL368755.544.914.96-0.47

Barrick Gold*ABX3683749.9047.1147.42-1.29

Arch Coal*ACI3592414.1612.8412.89-1.29

Silver Wheatn*SLW3403140.3637.1137.59-1.16

Newmont Mng*NEM3244662.6058.5058.96-3.55

Potash C Sask*POT2870447.5045.7846.66+0.13

U.S. greatest percentage change

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Goldfield*GV39970.740.390.66+100.0

Silver Dragon*SDRG53490.070.040.06+100.0

Li3 Energy*LIEG20140.150.100.13+44.4

Lake Vict Mng*LVCA450.200.070.11+37.5

Infrastrc Mat*IFAM210.080.070.08+33.3

Avino Silver*ASM4162.541.852.43+29.9

Canarc Res*CRCUF300.100.100.10+11.1

Mountain Prov*MDM1245.264.685.19+8.1

Mag Silver*MVG9910.639.5210.28+7.6

America West*AWSR71720.890.550.70+7.6

Golden Phoen*GPXM80000.080.050.05-37.5

Tombstone Exp*TMBXF1250.050.040.04-20.0

Thompson Crk*TC48908.847.117.28-17.4

Radius Gold*RDUFF1090.380.300.33-17.5

Gold Am Mng*SILA5690.060.050.05-16.6

Richmont Mine*RIC341412.249.8910.06-15.3

OM Group*OMG351530.6624.6025.36-15.1

Alpha Nat Res*ANR5952720.2717.3317.40-14.9

Patriot Coal*PCX42838.046.866.89-14.9

Rare Elemt Re*REE53496.235.365.37-13.1

U.S. greatest value change

WEEK

VOLUMECLOSECHANGE

Agrium*AGU133277485.23+1.54

Alliance Rs P*ARLP38393871.71+0.76

Ivanhoe Mines*IVN1543477518.25+0.74

Mag Silver*MVG9916810.28+0.73

Avino Silver*ASM4159822.43+0.56

AuRico Gold*AUQ294701610.12+0.53

Harry Winston*HWD19898214.06+0.51

Goldcorp*GG2652897849.13+0.51

Franco-Nevada*FNV87952944.64+0.45

Mountain Prov*MDM1243715.19+0.39

OM Group*OMG351460625.36-4.54

Cliffs Nat Rs*CLF1774798864.02-3.84

Newmont Mng*NEM3244612358.96-3.55

Peabody Enrgy*BTU2543331132.89-3.44

Walter Energy*WLT184438062.99-3.32

Alpha Nat Res*ANR5952732817.40-3.06

Consol Energy*CNX1793697433.93-2.40

Molycorp*MCP1443464724.55-2.26

Royal Gold*RGLD251851669.61-1.98

Seabridge Gld*SA151
735323.04-1.94