TSX Venture Exchange, Apr. 15 – 19

The S&P/TSX Venture Composite Index continued its downward spiral, as struggling commodity prices and a gloomier global outlook from the International Monetary Fund (IMF) contributed to an 8.2%, or 83.5-point loss, en route to closing at 939.07.

Commodity prices suffered early in the week following news that China’s economy had grown less than forecast in the first quarter. The world’s second-largest economy registered annual growth of 7.7% from January to March, while analysts had expected around 8%.

Compounding the gloominess, the IMF cut its outlook for the world economy in 2013, dropping its global growth target from 3.5% to 3.3% on the back of government-spending cuts in the U.S. and European Union.

Meanwhile, Statistics Canada reported nearly no inflationary pressure on the Canadian economy, with the Consumer Price Index rising just 1% in March, while the loonie finished the week up 7¢ at US$97.54.

On the commodity side, gold futures began a slow recovery after a massive sell-off over the previous week. June contracts for gold bullion jumped 3.8%, or US$51.50, before closing at $1,403.35 per oz. on April 19. Copper suffered the most, however, as May contracts for the red metal fell 5.8%, or 19¢, before closing at US$3.15 per lb.

Silver juniors struggled after the precious metal hit a 52-week low at US$22 per oz. during mid-week trading. Markets recovered slightly before silver closed down 10.5%, or US$2.73, at US$23.19 per oz.

As a result Vancouver-based Santacruz Silver Mining saw its share price drop 32¢ during the week to $1.44 per share, while Avino Silver & Gold Mines fell 26¢ before closing at $1.12. Mexico-focused silver producer Aurcana sunk 12¢ on 14.5-million share volumes before finishing up at 45¢ per share.

Shares of Afferro Mining jumped 24¢ during the week, before closing at $1.10, following news that U.K.-based International Mining and Infrastructure (IMIC) had tabled a bid for the company. According to an IMIC release the offer values Afferro at between US$160 million and US$225 million depending on the deal’s share-to-cash structure, though the cash portion of the bid is capped at US$100 million.

Afferro has been developing an iron-ore portfolio in Cameroon, which includes its 100%-owned Nkout, Ntem and Akonolinga projects, as well as a 70% stake in its Ngoa project. IMIC also announced it has entered into strategic partnerships with two Chinese state-owned enterprises regarding an infrastructure and off-take solution at Nkout. Afferro closed the week with 105 million shares outstanding and a $115.5-million market capitalization.

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