Market news

Toronto Stock Exchange

Investor frustration over the slow pace of the global economic recovery was seen as the culprit in the S&P/TSX Composite Index’s 143-point decline to 12,392.18 for the period.

Resource stocks and commodities were particularly hard hit, and low faith in materials led to selling of the Canadian dollar, which lost 0.2¢ to finish at US$1.01. Key factors such as the European debt crisis and higher-than-expected U.S. jobless claims shared the blame for the market’s downward trend.

Despite bad news on the global economic front, gold held its value and stayed up US$7 to US$1,669.30 per oz. But the increase didn’t transfer over to the miners, with the S&P/TSX Global Gold Index dropping 6 points to 336.40 points.

The diversified miners fared no better, and the S&P/TSX Capped Diversified Metals & Mining Index dropped 31 points to 1,044.20 points. Selling in the base metals sector drew a mixed bag of metal prices with copper prices flat, aluminum and nickel prices down and lead, zinc and tin prices slightly higher.  

Lower nickel prices were the least of Mirabela Nickel’s problems. The Australian-based miner was the period’s biggest loser by percent points, with shares coming off 34% to 58¢ after Standard & Poor’s lowered its credit rating to CCC+ from B-. The downgrade was based on a three-month delay in a processing facility upgrade at its Santa Rita mine in Brazil, and higher production cash costs. The rating agency said these factors, when combined with possible lower nickel prices, could lead to lower liquidity. 

On the other end of the spectrum, strong test results from Energizer Resources’ Green Giant project in Madagascar lifted the company’s shares 68% to 42¢. The one-time vanadium project is now being explored for its graphite potential, and initial results from the project’s Fotsy and Molo zones yielded flake sizes greater than 50 mesh, and graphite concentrates at purities exceeding 90%. 

Silver producer Scorpio Mining announced a net loss of $1 million during last year’s fourth quarter, and its stock fell 23% to $1.30. Net earnings were down 59% largely because sales for the quarter were off 12% to $13.8 million. The dip came from metallurgical variances in the concentrate Scorpio produces, and a drop in copper production to the tune of 17%. At presstime, Scorpio is being sued by joint-venture partner Golden Phoenix Minerals.

Fortuna Silver Mines was also punished for poor financial results. The company’s shares were off 27% to $4.50 as cost escalations meant it missed last year’s guidance. The company said the higher costs would persist through 2012 and were caused by abnormally high taxes, metal sales that were less than production costs, a price adjustment and higher-than-expected smelter charges. The factors added up to a US$1.8-million loss for the fourth quarter.

TSX most active issues

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(000s)HIGHLOWCLOSECHANGE

Lake Shore GldLSG556301.321.021.03-0.22

Rubicon MnrlsRMX241703.463.103.27-0.09

Eastern PlatinELR180140.440.380.40-0.05

Kinross GoldK1745210.289.509.75-0.30

Uranium OneUUU159363.122.732.77-0.30

Barrick GoldABX1389044.5342.1943.35-0.45

Avion GoldAVR132801.320.971.02-0.20

Potash Cp SaskPOT1325947.2744.9045.54-0.01

Osisko MngOSK1325411.6210.9611.58+0.66

Teck Res BTCKB1208436.5933.6135.61+0.47

TSX greatest percentage change

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(000s)HIGHLOWCLOSECHANGE

Energizer ResEGZ45690.430.260.42+68.0

Canarc ResCCM10120.190.100.17+54.5

Vaaldiam ResVAA1710.140.110.14+27.2

Rockgate CapRGT22160.950.700.88+25.7

Polaris MinlsPLS1450.690.540.65+25.0

Wallbridge MngWM10600.220.160.19+18.7

Pac NW CapPFN9290.130.100.13+18.1

Niocan IncNIO270.710.600.70+16.6

Chalice Gold MCXN150.230.230.23+15.0

MalagaMLG36700.190.140.17+13.3

Mirabela NicklMNB36080.860.570.58-34.0

Fortuna SilverFVI88656.164.274.50-27.0

IverniaIVW14900.160.110.12-25.0

Scorpio MiningSPM74991.821.181.30-22.6

United SilverUSC3000.340.260.26-21.2

Redzone ResREZ860.310.300.30-21.0

Horizonte MnlsHZM680.230.180.18-18.1

Lake Shore GldLSG556301.321.021.03-17.6

Dejour EnterpDEJ1880.420.350.35-16.6

Avion GoldAVR132801.320.971.02-16.3

TSX greatest value change

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Allied NevadaANV57262232.41+1.22

Alamos GoldAGI259257218.31+1.10

Detour GoldDGC347971124.87+0.97

Franco-NevadaFNV213824642.89+0.95

Osisko MngOSK1325393511.58+0.66

Golden MnlsAUM2337408.40+0.60

Rainy River RsRR14634355.81+0.57

Karnalyte ResKRN2349719.60+0.52

New GoldNGD100242019.85+0.50

Premier Gold MPG22176275.25+0.49

Walter EnergyWLT2950759.00-3.57

Tahoe ResTHO483150021.02-1.83

Marklnd AGF PMMPM3480011.20-1.75

Fortuna SilverFVI88647914.50-1.67

Cameco CorpCCO1150959021.41-1.21

Richmont MinesRIC11445227.77-1.13

Ivanhoe MinesIVN497817815.69-0.83

Inmet MiningIMN150609356.40-0.60

Silver WheatonSLW669001933.08-0.58

Harry WinstonHW131869814.68-0.52

TSX Venture Exchange

The S&P/TSX Venture Composite Index rose 10.87 points to 1,566.39 after two days of gains outweighed three days of losses. Volume was up from the week before but still fairly modest at an average of 94.5 million shares traded daily.

Graphite speculation has gained significant buzz in recent months, and reached new heights in the period. Companies that focused on the commodity were clear standouts.

Northern Graphite saw the highest value gains of the index, up 56¢ in the period to $3.19 as investors clamoured to get into the latest hot commodity. The company’s share price has climbed from 90¢ in mid-January, in which time it has announced an extra-large-flake graphite research tie-in, and also closed a $10.6-million offering. The company is advancing its large-flake Bissett graphite project in Ontario, which hosts a resource of 26 million indicated tonnes grading 1.81% graphite and 55 million inferred tonnes grading 1.57% graphite.

Not far behind in gains was Flinders Resources, whose share price climbed 50¢ in the period to end at $2.73 near its closing price of $2.95 on its first day of trading, while in between the company has traded at a low of $1.52. The company owns the past-producing, 13,000-tonne-per-year Kringel graphite mine in Sweden, which hosts a historic resource of 6.9 million tonnes grading 8.8% graphite. In the period the company announced a $15-million proposed financing at $1.70 per unit, and in early March started a 2,500-metre, 35-hole drill program. 

Zenyatta Ventures was the second most active company with 10.3 million shares traded, and was the highest percent gainer with a 23¢, or 144% jump, to 39¢, also due to its graphite holdings. The company released no news in the period, but a February study on its Albany graphite deposit in northeastern Ontario showed the presence of coarse-flake graphite, and a January drill hole intersected eight breccia zones containing graphite. Zenyatta is launching a 4,000-metre drill program to test a 1,400-by-800-metre airborne electromagnetic conductor. 

< p>Strike Graphite rose 9¢ to 35¢ after getting a drill permit for its Simon Lake graphite project in Saskatchewan. The company, which changed its name from Strike Gold in January, acquired the Simon Lake and Deep Bay East properties last September from Zimtu Capital, and more recently acquired the Wagon property from Zimtu. 

Property aggregator Zimtu bought several graphite projects early on, and in recent months has been optioning them off. Several property deals counted as qualifying transactions for companies and all companies have since seen gains. Orocan Resource, recently renamed Standard Graphite, has gone from 20¢ before making a deal in November to a 90¢ high, and Lomiko Metals has climbed from 5¢ in early January to an  18¢ high.

TSX-V most active issues

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(000s)HIGHLOWCLOSECHANGE

Sandstorm Mt&ESND114420.440.430.430.00

Zenyatta VentZEN102970.390.150.38+0.22

Canada FluorspCFI102800.550.470.52-0.01

Aurcana CorpAUN87140.980.830.88-0.04

Sandstorm GldSSL83291.931.801.88+0.07

Corsa CoalCSO81780.320.280.30-0.01

Duran VentDRV66480.130.100.110.00

Trelawney M&ExTRR61302.602.332.59+0.31

Focus MetalsFMS60581.331.111.20+0.04

Great WesternGWG58970.540.470.50-0.02

TSX-V greatest percentage change

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(000s)HIGHLOWCLOSECHANGE

Zenyatta VentZEN102970.390.150.38+137.5

Kingsman ResKSM850.030.020.02+100.0

Inlet ResINL2940.400.250.38+80.9

MacDonald MnsBMK26430.170.110.17+70.0

Nomad VenturesNMD1020.370.150.18+50.0

Cooper MnlsCQ1180.100.080.10+42.8

Sultan MnrlsSUL1880.070.050.07+40.0

Silver PursuitSPF1780.150.110.14+40.0

Thor ExplTHX5860.190.190.19+35.7

Empire MngEPC2560.130.090.12+33.3

Fort St J NickFTJ2880.100.070.07-46.1

Valencia VentVVI1080.080.050.05-44.4

Alexander MngAXD300.080.040.04-42.8

Caerus ResCA4200.220.120.12-42.8

Volcanic MtlsVOL12360.050.030.03-40.0

Stratabd MnrSB1000.060.060.06-40.0

Cascade ResCC2630.030.020.02-33.3

Canaf GroupCAF1440.090.070.07-30.0

Great Bear ResGBR870.100.080.08-27.2

Falcon GoldFG320.140.110.11-26.6

TSX-V greatest value change

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VOLUMECLOSECHANGE

Northern GraphNGC51519063.19+0.56

Flinders ResFDR20428942.73+0.50

Lumina CopperLCC24009216.35+0.48

Trelawney M&ExTRR61301142.59+0.31

Chesapeake GldCKG16442612.00+0.27

Hana MngHMG30547111.88+0.24

Zenyatta VentZEN102968980.38+0.22

Anfield NickelANF837204.15+0.20

Lithium OneLI30833841.33+0.17

Inlet ResINL2941660.38+0.17

Verde PotashNPK2632156.06-0.54

Mirasol ResMRZ1150243.05-0.37

Astur GoldAST1666001.14-0.26

Afferro MngAFF398931.00-0.15

Reservoir MnlsRMC638000.47-0.13

Titanium CorpTIC3350731.44-0.13

Yellowhead MngYMI19138980.99-0.13

St Elias MnsSLI5419260.59-0.12

Clifton StarCFO2240701.60-0.12

Huldra SilverHDA3430361.27-0.11

U.S. markets

The Dow Jones Industrial Average rose 131.31 points, or 1.0%, to 13,212.04 during the trading week, while the S&P 500 Index edged 11.36, or 0.81% higher, to 1,408.47. The Dow and the S&P 500 closed out their best first quarter since 1998, mainly on improving economic data, with the Dow up 8.1% and the S&P 500 12%. 

Rio Tinto advanced US$1.85 to US$55.59 per share in the wake of news on March 27 that it has begun a strategic review of its diamond business, including options to sell its diamond assets. The miner operates three diamond mines with a 60% interest in Diavik in Canada, full interest in Argyle in Australia and a 78% interest in Murowa in Zimbabwe. Rio Tinto also has a 100% stake in Blunder, which is an advanced diamond project in India. Separately it announced March 28 that it had received a binding offer for its specialty alumina business from HIG European Capital Partners. The company said the potential sale is in-line with its strategy of streamlining its aluminum group with the divestment of non-core assets. Rio Tinto’s specialty alumina business has three production sites in France and one in Germany.

The first national standards on carbon emissions from new power plants in the U.S. pushed down the shares of coal miners. The new regulations only apply to future power plant sites, and a one-year grace period will be given for plants currently under construction. Under the rules power plants will not be allowed to emit more than 454 kilograms of carbon per megawatt hour. Standard coal plants emit more than 800 kilograms an hour. Alliance Resource Partners plunged US$6.63 to US$60.10, Peabody Energy fell US$1.23 to US$28.96, Arch Coal slid 95¢ to US$10.71 and Alpha Natural Resources dropped 77¢ to US$15.21. 

Walter Energy shares took an extra hit when the company announced on March 26 that its first-quarter results would be disappointing, following flat sales volume and weaker coal prices. It plans to decrease production from its Maple underground coal mine in West Virginia by 35%, owing to market conditions. Walter Energy shares ended the week down US$3.51 at US$59.21.

U.S. most active issues

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Alcoa*AA11833510.319.7510.02-0.09

Freeport McMo*FCX9246739.6536.7638.04-0.44

Alpha Nat Res*ANR5995416.2314.5415.21-0.77

Peabody Enrgy*BTU4826530.6828.1828.96-1.23

Arch Coal*ACI4753811.8210.4410.71-0.95

Kinross Gold*KGC4447910.369.519.79-0.24

Potash C Sask*POT4112147.6744.9545.69+0.17

Newmont Mng*NEM4025254.1550.4751.27-2.05

Barrick Gold*ABX3656244.8742.2043.48-0.28

Mosaic*MOS3453059.8054.6155.29-2.41

U.S. greatest percentage change

VOLUMEWEEK

(000s)HIGHLOWCLOSECHANGE

Goldfield*GV31391.100.660.97+49.2

Golden Phoen*GPXM40570.040.030.04+33.3

Tombstone Exp*TMBXF4740.040.030.04+33.3

Gold Reserve*GRZ4153.982.973.98+32.2

Gold Am Mng*SILA790.050.030.05+25.0

Canarc Res*CRCUF6720.170.090.16+23.0

Radius Gold*RDUFF510.320.270.29+20.8

Legend Intl H*LGDI10710.180.100.13+18.1

Molycorp*MCP3128035.2029.5333.83+13.0

Primero Mng*PPP3742.642.392.61+9.2

Infrastrc Mat*IFAM100.020.020.02-66.6

Fortuna Silvr*FSM47396.194.284.52-26.3

Silver Dragon*SDRG56690.060.040.05-16.6

Lake Shore Gd*LSG28581.321.031.04-16.1

Dejour Enterp*DEJ6040.420.340.35-14.6

Petaquilla Mn*PTQMF3840.520.440.45-13.4

Richmont Mine*RIC20969.327.537.78-12.5

Apolo Gold*APLL180.350.170.35-12.5

Lake Vict Mng*LVCA220.100.080.08-11.1

Alliance Rs P*ARLP160068.1156.6960.10-9.9

U.S. greatest value change

WEEK

VOLUMECLOSECHANGE

Molycorp*MCP3127961133.83+3.91

Compass Mnls*CMP40346271.74+2.32

Rio Tinto*RIO346538155.59+1.85

Royal Gold*RGLD248645065.22+1.38

Allied Nevada*ANV38240632.53+1.28

Buenaventura*BVN409406640.31+1.12

Franco-Nevada*FNV71180242.98+1.03

Gold Reserve*GRZ4151933.98+0.97

BHP Billi-BHP*BHP1513222372.40+0.82

Soc Quim&M Ch*SQM182184958.67+0.70

Alliance Rs P*ARLP159977060.10-6.63

Walter Energy*WLT262741959.21-3.51

Randgold Res*GOLD477880687.98-3.3
4

Mosaic*MOS3452969355.29-2.41

Newmont Mng*NEM4025159451.27-2.05

Fortuna Silvr*FSM47389344.52-1.62

Cliffs Nat Rs*CLF1663952169.26-1.52

Peabody Enrgy*BTU4826497528.96-1.23

Natural Rs Pt*NRP25036423.99-1.15

Richmont Mine*RIC20961217.78-1.12