TSX Venture falls slightly, Nov. 5-9

VANCOUVER — The S&P TSX Venture Composite Index dropped a marginal 9.8 points or 0.74% during the Nov. 2-5 trading period, before closing the week at 1,300.92 points.

Uncertainty continued to surround the U.S. economy following Barack Obama’s election victory, though the Venture benefitted from rising commodity prices and solid economic data out of China.

Gold jumped US$53.90 before closing the week at US$1,738.80 per oz., with speculators viewing a Democrat victory as foreshadowing more quantitative easing going forward. December crude contracts were up US98¢ on the New York Mercantile Exchange to US$86.07 per barrel, while copper remained relatively stable, dropping US2¢ prior to closing the week at US$3.45 per lbs.

The Chinese government reported an improvement in consumer spending with retail sales rising 14.5% in September, as factory output expanded by 9.6%. Inflationary pressure continues to ease in China, leading to speculation that the government may have further room to work with stimulus measures, including interest rate cuts.

Vancouver-based Brixton Metals posted strong gains after announcing results from a 1,700-metres drill program that expanded its polymetallic Oban Breccia zone at the company’s flagship Thorn property 130 km southwest of Atlin, B.C. Brixton jumped 79% before closing out the week at 22¢ per share.

Drilling established a 100-metre true-width zone at depths of 300 metres that runs 130 metres along strike. The depth of the holes ranged from 45 metres to 338 metres.

Hole THN12-83 extended mineralization roughly 70 metres southeast at a true thickness of around 100 metres. Highlights from the hole include 150 metres averaging 5.67 grams gold equivalent per tonne and 315 grams silver equivalent per tonne.

Brixton has an earn-in agreement with Kiska Metals that could see it hold as much as a 65% interest in Thorn, conditional on $10 million in exploration expenditures.

Mexican-focused explorer Newstrike Capital dropped 31¢ or 11% en route to a $2.30 weekly close. On Nov. 6, the company announced results from 8,000 metres of drilling over 15 holes at its Ana Paula gold-silver project in Mexico’s Guerrero Gold Belt. The holes in the series were collared in the northeast and southeast quadrants of the property and focused on lower-grade mineralization. Newstrike reported results from both exploratory holes and from an ongoing delineation program targeting a maiden resource estimate.

Highlights from the program include: 31 metres of 0.07 gram gold per tonne and 24 grams silver per tonne in hole 12-116; 13 metres grading 0.91 gram gold and 3.5 gram silver in hole 12-121; and 12.2 metres averaging 1.15 grams gold and 5.3 grams silver in hole 12-123.

Emerging silver producer SilverCrest Mines rose 16¢ before settling out the week at $2.83 per share. The company followed up a $34.5 million prospectus offering at the end of October with an announcement on Nov. 7 that it had paid out a gold hedge facility and was now a completely unhedged producer.

In order to fund development at its Santa Elena silver mine, SilverCrest arranged a hedge facility with Macquarie Bank comprised of 55,000 oz. of gold sold forward at US$926.50 per oz. During 2010 and 2011 SilverCrest paid off 26,000 oz. of gold owed and deliveries were scheduled to continue into 2014. The company settled its balance of 29,000 oz. of gold for roughly US$23 million, effectively representing a price of US$1,728 per oz.