Market news

Toronto Stock Exchange

Concerns over the European debt crisis continued to keep North American markets from a healthy recovery. The TSX Composite Index clawed out a meagre 72-point gain over the Oct.3–7 period, at 11,588.36 points. The small upward swing came in spite of strong economic indicators, such as a better-than-expected payrolls report in the U.S. 

Volatility in the price of gold continued as the yellow metal recovered from its recent slide and moved higher by US$45 to finish the period at US$1,670.80 per oz. That move didn’t help gold miners, as evidenced by the Global Gold Index dropping down 15 points to 387.76 points. But the improved economic outlook made for stronger copper, aluminum, nickel, tin, lead and zinc prices, and those higher prices rippled through to the companies that mine them, with the Capped Metals & Mining Index up 107 points to 929.39 points for the period. 

Cline Mining saw its share price shoot up 48% to $1.67 during a busy period for the coal miner. First, the company announced that a financing deal would secure US$50 in debt for the company’s coffers. Then, three days later, it announced that Xstrata Coal was acquiring its Lossan metallurgical coal deposit for $40 million. Lossan sits in northeastern B.C. and has 240 million tonnes of coal resources.

Talison Lithium also enjoyed a strong run, as its share price climbed 37% to finish at $2.98. The lift came after the company announced its first quarter sales were up 53% over last year, to 80,315 tonnes of lithium concentrate.

The discovery of gold at surface and a hostile takeover offer had Inter-Citic Minerals shares climbing. The company’s stock was up 36% to $1.06  after reporting that trenching at its Dachang gold project in China uncovered five parallel fault structures that have strike lengths of 800 to 1,500 metres and remain open to further expansion. Three days after the announcement of the discovery, the company said it had rejected an unsolicited proposal from a large Chinese mining company to acquire all of its outstanding shares. Inter-Citic said the offer valued the company’s shares at between $1.20 and $1.70 per share — a sum that management says undervalued the company. 

Word that Paladin Energy had to shut down its processing plant at the Kayelekera mine in Malawi didn’t hurt the company’s stock. Paladin said the plant was being idled temporarily so that it could replenish sulphuric acid inventories. These need restocking because the acid plant — which is undergoing repair for ground movement — is restarting ahead of schedule. By shutting down the processing plant, acid stocks can be built for earlier start-up of the acid plant. The company also announced a private placement that will see 56.8 million shares issued at $1.24 per share, for gross proceeds of $70 million.

TSX most active issues

VOLUME WEEK

(000s) HIGH LOW CLOSE CHANGE

Lundin Mng LUN 51728 4.12 3.17 3.81 + 0.16

Teck B TCKB 24521 35.95 27.39 33.65 + 2.73

Kinross Gold K 22769 15.83 13.62 14.16 – 1.41

Cline Mng CMK 22594 1.67 0.99 1.67 + 0.54

Mercator Mnls ML 19847 1.75 1.19 1.59 + 0.19

Uranium One UUU 19244 2.33 1.85 2.11 + 0.04

First Quantum FM 18692 17.42 12.60 15.70 + 1.75

Anvil Mining AVM 18341 7.64 7.32 7.38 – 0.28

Potash Cp Sask POT 16738 49.00 41.99 46.40 + 0.90

Yamana Gold YRI 16458 14.85 13.15 14.55 + 0.17

TSX greatest percentage change

VOLUME WEEK

(000s) HIGH LOW CLOSE CHANGE

CIC Energy ELC 3827 2.20 1.36 2.10 + 52.1

Cline Mng CMK 22594 1.67 0.99 1.67 + 47.7

Emed Mining EMD 773 0.14 0.09 0.14 + 40.0

Polo Res POL 25 0.07 0.07 0.07 + 40.0

Talison Lithm TLH 3208 3.15 1.73 2.98 + 36.7

Inter-Citic Mn ICI 1117 1.14 0.72 1.06 + 35.9

Dejour Enterp DEJ 350 0.33 0.23 0.33 + 32.0

Paladin Energy PDN 6249 1.58 1.07 1.54 + 29.4

Geologix  Ex GIX 1856 0.30 0.20 0.29 + 26.0

Erdene Res Dev ERD 311 0.53 0.32 0.50 + 25.0

EMC Metals EMC 789 0.14 0.09 0.10 – 37.5

Lipari Energy LIP 22 1.36 1.25 1.30 – 25.2

Armistice Res AZ 333 0.26 0.20 0.22 – 24.1

Vaaldiam Res VAA 318 0.09 0.07 0.07 – 22.2

Polaris Minls PLS 424 0.50 0.40 0.40 – 21.5

Canarc Res CCM 123 0.15 0.12 0.12 – 20.0

Chalice Gold M CXN 26 0.38 0.20 0.31 – 18.4

WGI Heavy Mnl WG 113 0.44 0.38 0.40 – 18.3

Solitario Res SLR 51 1.79 1.46 1.47 – 17.8

Magma Metals MMW 226 0.15 0.13 0.14 – 17.6

TSX greatest value change

WEEK

VOLUME CLOSE CHANGE

Inmet Mining IMN 2436834 49.21 + 4.81

Teck A TCKA 30010 35.00 + 3.06

Teck B TCKB 24520800 33.65 + 2.73

Ivanhoe Mines IVN 6873364 16.77 + 2.32

First Quantum FM 18692084 15.70 + 1.75

Detour Gold DGC 2082689 28.82 + 1.52

Major Drilling MDI 2965829 11.72 + 1.46

Agrium AGU 5194957 71.16 + 1.41

Europn Goldfld EGU 3310403 9.65 + 1.34

Northern Dyn M NDM 1424121 6.80 + 1.19

Agnico-Eagle AEM 4159735 59.22 – 3.43

Richmont Mines RIC 1543368 9.23 – 1.84

Seabridge Gold SEA 103869 22.25 – 1.59

Newmont Mng NMC 42240 64.66 – 1.46

Kinross Gold K 22768660 14.16 – 1.41

IAMGold Corp IMG 7053151 19.64 – 1.19

Eldorado Gold ELD 9276200 17.16 – 0.89

Semafo SMF 5609349 7.80 – 0.85

Royal Gold RGL 52764 66.07 – 0.80

Barrick Gold ABX 14865803 48.44 – 0.67

TSX Venture Exchange

Tentative signs of economic calm were enough to give the TSX Venture Composite Index a gain of 5.33 points in the Oct. 3 to 7 period, the first week in the black since August. The index remained volatile during the period, however, dropping 133.82 points in the first two days to hit 1,333 points — the lowest since November 2009 — before recovering to end the period at 1,472.50 points. Volume dipped somewhat to an average of 90.6 million shares traded daily, owing largely to a steep drop on Oct. 7.

As hints of optimism emerged, several stocks made big gains on little or no news. Anfield Nickel was by far the biggest value gainer of the week despite releasing no news since August, climbing 93¢ to $4.99, to within 1¢ of its 52-week high. In August the company released a scoping study on its Mayaniquel nickel project in Guatemala that outlined a net present value of US$606 million and a 14.1% internal rate of return. The study was based on a long-term nickel price of US$8.25 per lb. nickel. In late September nickel prices hit a 52-week low of US$7.95 per lb., but recovered to US$8.50 per lb. in early October.

Recent spin-out Tigray Resources also had a big week on no news, taking second place in value gains with a 56¢ rise to $1.66, for a roughly 50% gain. Canaco Resources spun out its Ethiopian assets into Tigray in early September, while the new entity just closed a $5.25-million non-brokered private placement. The company issued 5 million units at $1.05 each, with units containing a share and a warrant exercisable at $1.50 and $2, depending on the date.

Exploration Orbite was the most-traded stock, with 14.5 million shares traded as it managed gains of 55¢ to close at $2.01. The company received conditional approval for listing on the TSX, and on Oct. 10 it announced it switched its alumina plant from a batch process to a semi-continuous process. Orbite is working to prove the viability of its patented process of extracting alumina from clay. The company has a 52-week share price range between 40¢ and $5.69.

Selwyn Resources saw a huge bump in activity to become the s
econd most-traded stock, with 13.6 million shares traded after Pan Pacific Metal Mining sold 13 million shares at 14.5¢ apiece. The sell off had little effect on the company’s share price, which ended flat at 15¢. Pan Pacific still holds 50 million shares, or 12.9% of Selwyn, which is developing the Selwyn lead-zinc deposit in the Yukon and working to reactivate the ScoZinc mine in Nova Scotia.

Chesapeake Gold continued its retreat after an impressive run in recent weeks. The company went from $12 in late August to a brief high of $18.80 in Sept. 23, before falling back down to as low as $12.50 on Oct. 5. The company dropped $1.65 in the period to end at $13.85. Chesapeake is developing the sizeable Metates gold project in Mexico’s Durango state.

U.S. markets

Policy moves in Europe and better jobs data n the U.S. helped stabilize equity markets. The Bank of England launched a second round of quantitative easing with a pledge to buy £75 billion (US$115 billion) of assets with new money, while the European Union vowed to come up with a coordinated plan to recapitalize the banks. Unemployment remains at 9.1%, but the U.S. Labour Department said employers added 103,000 jobs in September and revised its August figures from zero to 57,000 new jobs. Improved prospects sent the Dow Jones Industrial Average up 1.74% to 11,103.12 points, while the S&P 500 Index climbed 2.13% to finish at 1,155.46. The Philadelphia Gold and Silver Index advanced 1.32% to 187.44.

Ivanhoe Mines jumped 18.6%, or US$2.55, to close at US$16.25 per share after reassuring shareholders that its management, along with Rio Tinto and the Mongolian government, concluded discussions and “reaffirmed their continued support for the [Oyu Tolgoi] investment agreement and its implementation.” Late last month a group of lawmakers urged the government to revise the terms of the investment agreement tomake the deal better for Mongolia.

Cliffs Natural Resources rose US$4.70 to close at US$55.87 per share on no news. Last month the iron ore giant announced plans to sell its “renewaFUEL” biomass facility in Michigan, which was built to produce high-energy, low-emission biofuel cubes from sustainably collected wood and agricultural feed stocks. But since initial production it “has not performed to design capacity, nor at a production level that justifies continued operation,” the company said.

Despite copper prices hitting a 14-month low and fears of shrinking Chinese demand, shares of the world’s largest publicly traded copper company rose US$3.56 to US$34.01 per share. Freeport-McMoRan Copper & Gold declared a quarterly dividend on Sept. 29 of US25¢ per share, payable Nov. 1. 

Shares of Teck Resources climbed US$3.24 to US$32.43 per share on no news. On Sept. 30, it announced that its Highland Valley Copper operation and the United Steelworkers of America reached a tentative collective agreement.

U.S. most active issues

VOLUME WEEK

(000s) HIGH LOW CLOSE CHANGE

Alcoa* AA 260377 10.24 8.45 9.71 + 0.14

Freeport McMo* FCX 208669 35.72 28.85 34.01 + 3.56

Alpha Nat Res* ANR 66564 19.89 15.49 18.39 + 0.70

Kinross Gold* KGC 55523 15.07 12.80 13.68 – 1.10

Potash C Sask* POT 53311 46.99 39.54 44.72 + 1.50

Mosaic* MOS 52687 53.95 44.86 51.19 + 2.22

Hecla Mining* HL 49135 5.79 4.82 5.42 + 0.06

Arch Coal* ACI 47280 16.11 13.09 15.34 + 0.76

Teck B* TCK 41691 34.84 25.76 32.43 + 3.24

Barrick Gold* ABX 40930 48.62 42.89 46.64 – 0.01

U.S. greatest percentage change

VOLUME WEEK

(000s) HIGH LOW CLOSE CHANGE

Geovic Mng* GVCM 607 0.26 0.16 0.26 + 23.8

Uranerz Energ* URZ 1893 1.52 1.17 1.47 + 23.5

Northern Dyn* NAK 3973 7.20 4.87 6.60 + 23.1

Dejour Enterp* DEJ 728 0.32 0.21 0.32 + 23.0

US Antimony* UAMY 641 3.35 2.41 2.93 + 19.5

Ivanhoe Mines* IVN 26974 18.02 12.11 16.25 + 18.6

Taseko Mines* TGB 7677 3.12 2.30 2.93 + 18.1

Crosshair E&M* CXZ 113 0.49 0.33 0.47 + 17.5

Quest Rare Mn* QRM 2959 2.77 1.70 2.60 + 16.0

Alumina Inc* AWC 4493 6.60 5.20 6.53 + 15.5

Canarc Res* CRCUF 66 0.14 0.12 0.12 – 25.0

Starfield Res* SRFDF 45 0.03 0.02 0.03 – 25.0

Golden Phoen* GPXM 3084 0.09 0.07 0.08 – 20.0

Solitario Res* XPL 481 1.74 1.36 1.43 – 16.8

Silver Dragon* SDRG 1617 0.07 0.03 0.05 – 16.6

SinoCoking Cl* SCOK 410 3.07 2.26 2.60 – 16.4

Richmont Mine* RIC 5557 11.25 7.78 8.90 – 15.8

Douglas Lk Ml* DLKM 687 0.19 0.15 0.16 – 15.7

Gold Am Mng* SILA 302 0.08 0.06 0.06 – 14.2

Alberta Star * ASXSF 27 0.22 0.18 0.19 – 13.6

U.S. greatest value change

WEEK

VOLUME CLOSE CHANGE

BHP Billi-BHP* BHP 31104829 71.53 + 5.09

Cliffs Nat Rs* CLF 32059307 55.87 + 4.70

BHP Billi-BBL* BBL 11438768 57.40 + 4.32

Freeport McMo* FCX 208668708 34.01 + 3.56

Teck B* TCK 41690961 32.43 + 3.24

Compass Mnls* CMP 480470 69.34 + 2.56

Ivanhoe Mines* IVN 26973913 16.25 + 2.55

Buenaventura* BVN 6584087 40.05 + 2.31

Mosaic* MOS 52687490 51.19 + 2.22

Consol Energy* CNX 26057271 36.02 + 2.09

Agnico-Eagle* AEM 12218805 57.21 – 2.31

Richmont Mine* RIC 5557055 8.90 – 1.67

Molycorp* MCP 3633967 35.29 – 1.16

Kinross Gold* KGC 55523277 13.68 – 1.10

Seabridge Gld* SA 1298043 21.43 – 1.05

AngloGold Ash* AU 12438753 40.36 – 1.00

Royal Gold* RGLD 5863124 63.15 – 0.91

Eldorado Gold* EGO 6036719 16.55 – 0.59

Gold Fields* GFI 27582276 14.79 – 0.53

SinoCoking Cl* SCOK 409559 2.60 – 0.51