U.S. equities waver on global tensions, June 9-13

An insurgency by a radical Islamist group in Iraq and renewed tensions in the Ukraine put downward pressure on U.S. equity markets during the week, but pushed oil and gold prices up, lifting the fortunes of many precious metal companies. The Dow Jones Industrial Average and the S&P 500 Index fell 0.88% to 16,775.74 and 0.68% to 1,936.16. Gold closed at US$1,275.90 per oz. to gain  US$23.60 per oz., or 1.89%, and the Philadelphia Gold & Silver Index climbed 6.46% to 92.30.

Franco-Nevada, Randgold Resources, Royal Gold, Agnico Eagle Mines and Goldcorp were the biggest beneficiaries of higher gold prices, with their share prices rising to US$4.19, US$4.12, US$3.31 and US$2.20, on no material news.

Seabridge Gold’s announcement during the trading week that it has started exploration drilling at its wholly owned KSM project in B.C. drove its shares 19.5% higher to US$8.64. The exploration program will expand the 515-million-tonne inferred resource averaging 0.53% copper and 0.36 gram gold per tonne found last year at Deep Kerr and increase its average grade. It will also test prospective core zone targets that the company believes could have large, high-grade deposits similar to Deep Kerr, including the Iron Cap deposit at depth.

Shares of NovaGold Resources surged 20.3% to US$4.08 after a milestone agreement at its flagship 50%-owned Donlin Gold project in Alaska. The company announced on June 9 that it had reached an updated long-term surface-use agreement with Kuskokwim Corp. The agreement has been extended to coincide with the projected mine life at Donlin Gold, with provisions for an extension if production continues. Donlin Gold has measured and indicated resources of 541 million tonnes averaging 2.2 grams gold per tonne, and according to an updated feasibility study, should average 1.5 million oz. gold per year for the first five full years of production, followed by decades of more than 1 million oz. per year on a 100% basis. Permitting got underway in 2012 and is expected to take four years.

U.S. most active issues

U.S. greatest percentage change

U.S. greatest value change