Toronto Stock Exchange May 9-15

A pullback in commodity prices dragged the TSX Composite Index down 496.48 points, or 4.2% to 11,831.73 over the May 9-15 session; the downward trend was said to be the result of price corrections after weeks of speculative buying.

With worries that hikes in global interest rates could cut into the demand of some base metals, copper and zinc lost more than gold and silver. But the diversified miners’ index was not hit as hard as the gold index.

Copper prices fell by 9%, the most since October 2004, and zinc was down 12%, the most since 1989, but the diversified mining index fell only 7.5% to 502.11, compared with a 14.2% loss in the gold index. It fell to 314.49.

While gold closed in London as high as US$725 per oz. on the week, by May 15 it was at US$687.

Companies with assets in Mongolia got a double dose of bad news as lower metal prices combined with an initial approval of a 68% tax on gold and copper production in the country. The tax kicks in when the price of gold surpasses US$500 per oz. and copper exceeds US$1.18 per lb.

Ivanhoe Mines’ shares fell roughly 28% to $8.03 from a close of $10.25 before the news. The company is developing its Oyu Tolgoi copper-gold deposit in the country.

QGX also took heavy losses. The Waterdown, Ont.-based company with gold, copper and coal assets in Mongolia, fell 37% to $2.55 on 410,000 shares traded on May 15.

Both companies said they were negotiating with the government in the hopes that Mongolia’s president, Nambaryn Enkhbayar, would veto the tax.

Other companies with Mongolian assets whose shares fell on the news were Entre Gold, Centerra Gold, and Erdene Gold.

Inco shares slid after the company hiked its takeover bid for Falconbridge by about $2 billion to more than $19 billion and negotiated a higher break-up fee if the deal falls apart. Swiss-based Xstrata is expected to make a counter-bid for Falconbridge, which is rumoured to be as high as $20 billion. Inco shares were off $5 on the week, closing at $71.50 while Falconbridge shares fell just 51 to close at $52.35. Teck Cominco, which made a bid for Inco on May 8, was off $6.46, closing at $73.52.

Despite the bearish environment, there were winners during the period. Shares in Toronto-based Goldstake Explorations gained over 43% after the company added to recent drill results. The update reported a drill hole intersecting a copper lode at 680 ft., assaying 7% copper in primary ore.

Also on the upside was Ascendant Copper after two announcements regarding properties in Ecuador. The B.C.-based company now has the option to acquire a 100% interest in the Telimbela copper and molybdenum property in south-central Ecuador. It also purchased a 100% interest in the Magdalena property — which runs along strike of its Junin copper project.

TSX greatest percentage change

		VOLUME(000S)	HIGH	LOW	CLOSE	CHANGE
Lumina Res	LUR	1486	1.50	0.60	1.05	+69.3
Goldstake Exp	GXP	8032	0.295	0.145	0.215	+43.3
HMZ Metals wt	HMZ.WT	125	0.02	0.015	0.02	+33.3
Western Que	WQM	11	3.15	3.04	3.10	+26.5
Ascendant Copp	ACX	47	0.96	0.80	0.96	+23.0
Timminco	TIM	109	0.425	0.29	0.42	+20.0
Capital Gold	CGC	81	0.55	0.40	0.47	+18.9
Global Copper	GLQ	1557	2.20	1.65	2.08	+18.8
Eastern Pla wt	ELR.WT	156	0.80	0.60	0.71	+18.3
Sterlite Gold	SGD	728	0.14	0.10	0.13	+18.1
QGX	QGX	846	4.13	2.36	2.55	-36.7
Entree Gold	ETG	1350	2.55	1.42	1.68	-34.6
Northgate wtA	NGX.WT.A	512	2.38	1.30	1.40	-33.3
Taseko Mines	TKO	10103	4.66	2.80	3.10	-30.6
Northgate M wt	NGX.WT	1651	2.40	1.33	1.48	-29.5
StrataGold	SGV	1800	1.70	1.15	1.16	-29.2
Opawica Expl	OPW	2991	0.30	0.19	0.195	-29.0
Euro Res	EUR	60	3.00	2.20	2.21	-27.7
Pelangio Mines	PLG	1738	1.55	1.08	1.11	-26.0
Silver Wtn wtA	SLW.WT.A	862	1.87	1.33	1.36	-24.4

TSX greatest value change

		VOLUME	CLOSE	CHANGE
Falconbridge	FAL.LV	25837523	52.35	+1.97
Western Que	WQM	10500	3.10	+0.65
Imperial Metal	III	435960	10.75	+0.56
Lumina Res	LUR	1485742	1.05	+0.43
AfriOre Ltd	AFO	1849961	4.95	+0.36
Global Copper	GLQ	1557475	2.08	+0.33
Peru Copper	PCR	8411871	4.22	+0.32
Greystar Res	GSL	563927	11.75	+0.20
Ascendant Copp	ACX	46500	0.96	+0.18
Mercator Mnls	ML	2014061	2.65	+0.18
Potash Cp Sask	POT	2012905	107.75	-8.15
Teck Comin B	TEK.SVB	21411035	69.99	-6.48
Glamis Gold	GLG	7871443	39.41	-6.07
Centerra Gold	CG	877520	38.50	-5.88
Teck Comin A	TEK.MVA	33589	73.52	-5.75
Goldcorp	G	18024785	37.61	-5.04
First Quantum	FM	2890120	53.13	-4.86
Lundin Mng	LUN	338020	35.02	-4.73
Cameco Corp	CCO	7515039	43.11	-4.17
Alcan	AL	11278582	58.85	-3.60

TSX most active issues

1.49

		VOLUME(000S)	HIGH	LOW	CLOSE	CHANGE
EuroZinc Mng	EZM	99296	3.45	2.71	2.81	-0.22
Bema Gold	BGO	35170	6.97	5.50	5.62	-0.96
Chariot Res	CHD	33180	0.77	0.56	0.58	-0.03
Queenstake Rs	QRL	29295	0.60	0.465	0.475	-0.01
Equinox Minls	EQN	26041	2.35	1.85	1.90	0.00
Falconbridge	FAL.LV	25838	55.23	50.70	52.35	+1.97
Inco Ltd	N	25816	77.73	69.80	71.50	-3.18
Yamana Gold	YRI	24908	13.70	11.07	11.30	-0.85
Dynatec Corp	DY	24738	1.60	1.41	-0.02
Eldorado Gold	ELD	22243	6.37	5.33	5.38	-0.55