TSX rises on global optimism

The TSX Composite Index was up 118 points to 12,801.23 points for the February 4-8 period riding improving global investor sentiment. Investor confidence was bolstered by an unexpected drop in the U.S. trade deficit and data out of China that pointed to its economy strengthening.

Despite the price for gold being down US$3 to US$1,666.90 per oz. the Global Gold Index was up, if only 2 points, to 280.96 points

The Capped Metals & Mining Index, however, followed the trajectory of base metal prices. The Index was down 23 points to 977.66 points and the price for copper was off 2¢ to finish up the period selling for US$3.76 per lb.

Two of Canada’s top gold producers found one of their newly minted projects in the headlines for the wrong reasons. Just a few weeks after getting the Pueblo Viejo gold mine in the Dominican Republic into commercial production, joint venture partners Barrick Gold and Goldcorp could be doing battle with the national government. Reports out of the country said the Chamber of Deputies is thinking about renegotiating its contract with the companies for more favorable terms. The news had little effect on the two senior producers share price as Barrick shares finished the period up 74¢ to $32.84 while Goldcorp shares were up 71¢ to $36.23.

Western Lithium saw its share price rise by 38% to finish at 22¢ after closing a royalty financing that will raise US$20 million for company coffers. The financing was done with Red Kite, a metals focused investment firm, and will help Western Lithium fund the development of a mill with capacity of 10,000 tonnes per year at its Kings Valley project in Nevada

Platinum Group Metals got a boost the old fashion way: via the drill. The company’s shares were up 21% to $1.41 after announcing that drilling at the Waterberg Deposit in South Africa hit mineralized layers. If the layers are part of the F mineralization, as suspected, the deposit would expand by 750 meters eastward and be brought up dip from 1,000 metres vertical depth to about 280 metres deep. Platinum Group has a 50% stake in the Waterberg property, and is the operator.

And iron-ore producer Northland Resources shares fell 32% to 12¢ after it cancelled its planned $250-million equity issue and $125-million bond, which it expected would cover rising capital and operating costs at its Swedish mine. The company was supposed to start loading its first vessel with high-grade iron-ore from its Kaunisvaara mine on February 9 for shipment to its partner Tata Steel, in the Netherlands. Northland stock has fallen 85% since the beginning of the year when its shares were trading in the $1.20 range. The shares fell hard in late January after Northland said it had a funding shortfall which it attributed to higher than expected operating costs in the production ramp-up phase, higher capital expenditures, lower iron ore prices, and adverse movements in exchange rates.