Venture slips on low volumes in July 23-27 period

VANCOUVER — The S&P TSX Venture Composite Index slipped 5.55 points in the July 23 to 27 period to end at 1,190.64 points after two days of losses outweighed three days of gains. Volume was down considerably, coming in roughly 20 million lower than the week before with an average of only 53.3 million shares traded daily.

With established revenue, and being somewhat isolated from operational risks, gold-streaming company Sandstorm Gold has weathered the economic downturn better than most. That showed this past week when Sandstorm was the biggest value gainer, climbing 67¢ to $9.35, after releasing second quarter results. The company had record operating cash flow of US$11.3 million, net income of US$5.3 million, and average cash cost of US$298 per oz. gold for the record 9,259 oz. gold it sold. Sandstorm also secured several new royalties in the period, and set its forecasted attributable production for the year at between 28,000 and 33,000 oz. gold.

Argentina-focused Lumina Copper managed a 39¢ gain to end at $7.87 after partially reversing a five-day losing streak. On July 18 the company ended at $8.49 but by July 24 the company hit a low of $6.85, its lowest point since early October. Investors then piled back into the stock and reversed the streak, but only to a point. The company’s stock has been under severe pressure following a deteriorating investment climate in Argentina and the general downturn and is now well off its all-time high of $17.16 reached in late March.

Canamex Resources continues to see lots of activity, again the highest traded company with 22.1 million shares traded. The week before, the company announced an intercept of 118 metres grading 4.08 grams gold per tonne on its Bruner project in Nevada, and subsequently climbed 29¢ to 39¢. Capitalizing on that share price gain, the company quickly announced a $2.7-million financing at 27¢ per unit, with units containing one share and one warrant exercisable at 40¢ for five years. During the latest period the company’s share price slipped from 39¢ to a low of 25¢, but climbed back to end at 30¢ on news of the financing.

Anconia Resources’ share price climbed steeply on no news, doubling to 30¢ with 1.4 million shares traded. The company has base and precious metal projects in Nunavut and Ontario and announced in mid-July it plans to drill up to 1,500 metres on its Marce VMS target in Nunavut that it sampled last year. The company has 38.5 million shares outstanding following its raising of $1.6-million, though it originally set out to raise $4 million in February. Anconia financed at 20¢ per unit and traded as high as 45¢ last September but hit a low of 8¢ in early July before its recent climb.

Prophecy Platinum dropped 26¢ to end at $1.24 for the second-highest value drop after it re-released a preliminary economic assessment on its Wellgreen project. The previous PEA, released in mid-June, was based on an Energy and Metals Consensus Forecast while the update used London Metal Exchange three-year trailing averages. The updated assumptions knocked the project NPV down $648 million to US$2.4 billion and the IRR down to 32% from 38%, while LME spot prices put the project at an NPV of $1.8 billion and a 26% IRR.