U.S. equity indexes end marginally higher, Aug. 4-8

U.S. equity indexes were down for most of the week, as Russia banned imports of some western foods and U.S. warplanes prepared to strike targets in Iraq for the first time since 2011. But markets edged higher on Friday after Russia’s Defense Ministry said it had finished military exercises near the Ukraine border, and China reported that its trade surplus reached a record high in July. For the week, the Dow Jones Industrial Average Index rose 0.37% to 16,553.93 and the S&P 500 Index gained 0.34% to 1,931.59. The Philadelphia Gold & Silver Index climbed 1.78% to 101.26.

Shares of Newmont Mining and Barrick Gold ended higher after the Sydney Morning Herald quoted Newmont CEO Gary Goldberg as saying during a presentation to the Melbourne Mining Club that a revived merger “was not impossible … I wouldn’t shut the door on it … we are focusing on running our businesses as effectively and efficiently as we can going forward, and we will see what happens.” Goldberg reportedly had not heard from Barrick since the merger talks fell apart in April. Newmont’s shares climbed US$1.19 to US$26.39, while Barrick’s gained US48¢ to US$18.69.

Richmont Mines shares bounced 46.2% to US$2.15 after second-quarter results. The company posted adjusted net earnings of $5.7 million, or 12¢ per share, up from a $1.1-million net loss in the second quarter of 2013, or 3¢ per share. Operating cash flows in the three months ended June 30 reached a record $13.4 million, or 29¢ per share on record revenues of $39 million, for a 36¢-per-share improvement over operating cash flows year-on-year. Second-quarter cash costs per oz. fell 16% year-on-year from US$992 to US$779 per oz. this year. Richmont increased its 2014 gold production guidance to 75,000 to 85,000 oz., from its previous forecast of 70,000 to 80,000 oz.

News that Molycorp has entered into a commitment letter to secure a US$400-million financing for its Mountain Pass rare earth elements facility — with funds managed by Oaktree Capital Management  — sent the company’s shares up 13.4% to US$2.36. Under the arrangement, US$250 million of the financings could be borrowed upon closing, with the remaining US$150 million available until April 30, 2016, depending on Molycorp’s finances and operations.

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