U.S. equities slip, Feb. 6-10

Despite some signs of economic recovery in theUnited States, broader fears thatGreece’s parliament would not approve the stricter financial reforms necessary for the country to receive more bailout funds dampenedU.S.equities in the Dec. 6-10 trading week. The Dow Jones Industrial Average slipped 0.47% or 61 points to 12,801.23 while the S&P 500 index lost 0.17% or 2.26 points to finish at 1,342.64. The Philadelphia Gold and Silver index dropped 5.63 points or 2.81% to 194.71 and theNew Yorkspot price for gold fell US$3.80 per oz. to close the week at US$1,722.10 per oz.

Harmony Gold topped the list of companies with the largest gain in value advancing 49¢ to US$12.90. The company reported record operating profits of US$257 million in the second quarter of fiscal 2012. Gold production of 344,592 ounces represented a 5% increase over its first-quarter production with recovery grades climbing by 13% to 2.36 grams gold per tonne. Cash operating costs fell by 6% to US$958 per oz.

News of a merger between Eurasian Minerals and Bullion Monarch sent the latter’s shares up 31¢ to US$1.09. Under the deal announced on Feb. 7, Eurasian Minerals will acquire all of the outstanding common shares of Bullion Monarch in a cash and stock deal worth US$45.8 million. Bullion shareholders will receive 0.45 of a Eurasian Minerals common share and 11¢ in cash for each Bullion share held. The price represents an acquisition premium of 64%. If the transaction is completed, the combined company will have more than 145 properties on five continents. Bullion Monarch also has a currently paying 1% gross smelter return royalty on several of Newmont Mining’s operations and projects inNevada’s Carlin Trend, including the Leeville mine and theFour Cornersproject.

A royalty and equity investment agreement between Lake Shore Gold and Franco-Nevada Corp. lifted the share prices of both companies a little higher. Under the agreement Franco-Nevada will pay LakeShore Gold US$35 million for a 2.25% net smelter return royalty on mineral sales from the company’s Timmins West Complex. Franco-Nevada also will spend C$15 million in a private placement to acquire 10.05 million common shares of Lake Shore Gold at C$1.49 per share—a 5% premium to Lake Shore Gold’s 10-day volume weighted average price. Franco-Nevada’s shares ended the Feb. 6-10 trading week at US$44.27 per share, up 30¢, while Lake Shore Gold’s shares climbed 9¢ to US$1.52.