TSX Venture takes a tumble, Apr. 15-19

VANCOUVER — The S&P TSX Venture Composite Index continued its downward spiral during the Apr. 15-19 trading period, as struggling commodity prices and a gloomier global outlook from the International Monetary Fund (IMF) contributed to a 8.2% or 83.5 point loss en route to a 939.07 point weekly close.

Commodity prices continued to suffer 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% during the January through March period, which was lower than consensus analyst forecasts that estimated around 8%.

To compound gloomy sentiments the IMF cut back its outlook for the world economy in 2013, dropping its global growth target from 3.5% to 3.3% this year on the back of government spending cuts in the U.S. and European Union.

Meanwhile Statistics Canada continued to report nearly no inflationary pressure on the Canadian economy, with the Consumer Price Index rising just 1% in March, while the Canadian dollar finished the week with a 7¢ jump at US$97.54.

On the commodity side, gold futures began a slow recovery following a massive sell off over the previous week. June contracts for gold bullion registered a 3.8% or US$51.50 jump before closing at $1,403.35 per oz. on Apr. 19. Oil futures continued to struggle, with June contracts dropping around 3%, or US$2.66 per barrel, en route to a US$88.23 weekly close. Copper suffered the most, however, as May contracts for the red metal fell 5.8% or 19¢ before closing out the week at US$3.15 per lb.

Silver juniors struggled after the precious metal hit a 52-week low at around 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 saw its share price drop 32¢ on the week before closing at $1.44 per share, while Avino Silver & Gold Mines dropped 26¢ before closing at $1.12 per share. Mexico-focused silver producer Aurcana dropped 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 share-to-cash structure of the deal, though the cash portion of the bid is capped at US$100 million.

Afferro had been developing an iron-ore portfolio in the central African nation of 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 in connection with an infrastructure and off-take solution at Nkout. Afferro closed the week with 105 million shares outstanding and a $115.5 million market capitalization.

Beleaguered junior Pacific Booker Minerals continues to struggle following a refusal by the B.C. government to issue an environmental assessment permit for its Morrison Lake project in northern B.C. late last year. The company dropped 32¢ this past week before closing at $4.50 per share. Pacific Booker announced a lawsuit against the provincial government in February, and on Apr. 17 the company released the results of its requests to access records under the Freedom of Information and Protection of Privacy Act.

Pacific Booker requested a copy of a report containing the recommendations of the Executive Director of the Environmental Assessment Office, as well as all documents relating to the denial of its application for an environmental assessment certificate. According to a company release, the Ministry of Environment reported it had no documents in its possession matching Pacific Booker’s request, which will likely prompt the company to seek further action.