Toronto Stock Exchange, Feb. 3-7

Signs of strength in the Canadian economy coincided with an up period for the S&P/TSX Composite Index, which gained 86 points to 13,786.50 points over the week.

Statistics Canada said the economy created 29,400 jobs — beating the 20,000 economists were expecting — and the unemployment rate fell 0.2% to 7%. The numbers marked a turnaround from December when the Canadian economy lost 44,000 jobs. With jobs numbers south of the border missing expectations, the loonie was in favour again, reversing its recent downward trajectory and gaining 0.26 of a cent to reach US90.59¢.

The gold price held strong, as it was up US$20 to US$1,262.70 per oz. But the gains failed to flow through to the miners represented in the S&P/TSX Global Gold Index, falling flat at 183 points.

It was a different story in the base-metal sector, as stronger copper prices — up 5¢ to US$3.24 per lb. — complemented a gain for the diversified miners in the S&P/TSX Capped Diversified Metals and Mining Index, which was up 20 points to 830.

Augusta Resource  shares shot up 26% to finish the period at $2.51, one trading day before Hudbay Minerals launched an unsolicited, $540-million all-stock bid for Augusta. The offer values Augusta shares at $2.96 apiece and was announced on Feb. 9. With the deal Hudbay could secure one of the world’s biggest undeveloped copper projects in the form of Augusta’s Rosemont project in Arizona. Augusta has recently gained traction in its permitting process and had expected to begin construction later this year. Hudbay already owns 16% of Augusta’s shares.

The market responded well to some moves at Gran Colombia Gold. The company appointed a new CEO, Lombardo Paredes Arenas, and raised $4 million for its restructuring plan to curb costs at its Segovia gold mine in Colombia. The money comes by way of interest-free bridge loan from shareholders that have told Gran Colombia that they intend to purchase US$5-million worth of units connected to its offering last November. Gran Colombia said it was looking to raise between US$7 million and US$15 million by issuing units. The money is slated to go towards restructuring the Segovia and driving costs down to US$950 per oz. compared to last year’s US$1,300 per oz. Gran Colombia shares were up 48% to $1.45 for the period.

Assays from its Clearwater gold project gave Eastmain Resources a boost, as the company’s stock was up 24% to 52¢ for the period. The results were from the Eau Claire deposit, which is part of Clearwater in the James Bay region of Quebec. Highlights included 9.68 grams gold and 15.8 grams tellurium per tonne over 10 metres and 131.48 grams gold and 224.75 grams tellurium over 2 metres.

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