TSX dips 430 points during Nov.21-25

The S&P/TSX Composite Index ended the Nov.21-25 trading week lower as the European debt crisis continued to worry investors. The Index closed down 430.38 points to 11,462.06.

The Global Gold Index dipped 9.67 points to 391.50 as the price of gold took a blow, dropping US$44.50 per oz. to US$1,680.30.

The S&P/TSX Capped Diversified Metals & Mining Index also had a bad week as it lost 54.04 points to 955.68.

Armistice Resources was the week’s biggest percentage gainer, surging 37.5% to close at 22¢. The boost came after the company announced that it expects to start producing at its McGarry underground gold mine in December, with gold sales in early 2012.

Situated in the Kirkland Lake area of northeastern Ontario, the mine is expected to produce 25,000 oz. gold next year, before ramping up to 40,000 oz. in 2013 at cash costs of US$600-US$650 per oz. produced.

Talon Metals‘ share price soared 23.2% as it released inferred resources for target areas 4, 5, and 6 of its Trairao iron project in Brazil’s Para state. Combined the new resource totals 103 million tonnes grading 29% iron, using a 25% iron cut-off grade.

This adds 9% to the existing total 1.1 billion inferred tonnes averaging 36% iron for target areas 1, 2 and 3.

Kinross Gold was one of the heaviest traded stocks, with 24.3 million shares changing hands during the week. The company lowered its forecast for depreciation, depletion and amortization for the year to about US$600 million, down US$51 million from the previous forecast. The company’s 2011 guidance for production and cost of sales remains the same, with production at 2.6 million to 2.7 million attributable gold equivalent oz., and cost of sales between US$565 and US$610 per gold equivalent oz.  The gold miner gained 21¢ to close at $13.38 per share.

Lake Shore Gold saw heavy trading during the week on no news. The latest news the company announced was on Nov. 17 where it tabled initial resources for its Thunder Creek and Fenn-Gib gold projects. This bought company-wide resources to 6.4 million oz. But that didn’t keep Lake Shore from falling 27¢ this week to $1.31 apiece on 22.8 million shares traded.  

On Nov. 22, Allana Potash put out a preliminary economic assessment on its Dallol potash project in Ethiopia. The study envisions a solution mine at Dallol producing 1 million tonnes of potassium chloride a year for an initial 30 years. The project would cost US$796 million to build, and has an after-tax net present value of  US$1.85 billion, and an internal rate of return of 36.8%, at 12% discount. Minimal production is expected to start in late 2014, before ramping up to 1 million tonnes in 2017. Despite the positive scoping study, the company’s shares slipped 12¢ to $1.08 on 16 million shares traded.