TSX edges higher on solid earnings

The TSX Composite Index managed to gain 71 points to finish the April 16 to 20 period at 12,147.28 points. The slight gain came as the end of the period brought positive earnings reports out of both Canada and the U.S. while some commodity prices edged higher. The trend picked up the Canadian dollar as well as it was up 0.55¢ to $101.03.

Gold came back down after a stellar previous period as the metal was down US$16 to US$1,642.80 per oz. That selling pressure flowed through to miners as evidenced by the Global Gold Index shaving off 6 points to finish at 310.71 points.

The diversified miners didn’t do much better as the Capped Metals & Mining Index fell 15 points to 1,045.16 points. That relatively flat movement came on the back of mixed results in the metal market as the price of nickel, tin and lead were all lower, while copper and aluminum prices rose slightly and zinc prices were flat.

Companies were in the mood for making deals, and the market felt like rewarding them. The most heralded deal was one between Energy Fuels and Denison Mines as both companies made healthy gains after the announcement. The friendly offer would see Energy Fuels acquire all of Denison’s properties in the U.S. in an all stock deal that values the assets at $106-million and would leave Denison shareholders holding two-thirds of Energy Fuels. The deal would also make Energy Fuels the biggest uranium producer in the U.S. with large reserves to go along with all of that production. Energy Fuels shares were up 30% to 31¢ for the period while Denison shares were up 27% to $1.82.

And M & A activity was also behind Vaaldiam Resources surge up the markets. The company’s shares were the biggest gainers by percentage points as they jumped 104% to 31¢ on world that it would be acquired by the privately held firm BCKP Limited for $18.5 million. The offer breaks down to 25.8¢ per share and represents a 115% premium to Vaaldiam’s stock price. Vaaldiam holds gold and diamond exploration properties in Brazil as well as royalties on copper, gold and diamond properties in South America and Africa.

The period also saw AuRico Gold complete the sale of two projects in Mexico to Endeavour Silver. The deal marked AuRico’s second major asset sale in a month — transactions that have combined to raise over US$300 million in capital for the company. The sale is part of AuRico’s plan to focus on Canada and the U.S. while Endeavour is looking to expand its regional silver operations.

While deals were driving some miners, others had the drill to thank for market gains. Velocity Minerals was one as its shares climbed 16% to 22¢ after announcing an intercept of 46.75 metres grading 9.86% graphite. The assay was from one of its three newly-acquired graphite properties located in the Central Metasedimentary Belt in southwestern Quebec.