Mounting concern about Washington’s ability to avoid the fiscal cliff, or mandated tax hikes and spending cuts that could send the economy back into recession, drove markets lower. The Dow Jones Industrial Index fell 1.8% or 227.08 points to end the week at 12,588.31, while the S&P 500 index dropped 1.5% or 19.97 points to 1,359.88. The Philadelphia Gold and Silver index was down 8.5% or 15.44 points at 165.67.
Stocks in positive territory included luxury jeweler Harry Winston Diamond, which announced it will pay $500 million in cash for BHP Billiton’s diamond division. The division consists mainly of its 80% stake in the Ekati mine in the Northwest Territories. Harry Winston already owns 40% of the nearby Diavik diamond mine. Harry Winston shares ended the week 13¢ higher at US$13.45.
Shares of Quaterra Resources rose 13.8% or 5¢ to US$0.42 per share after it discovered a new silver zone at its Nieves silver property in Mexico. Two kilometres west of its current resource, drill hole QTA 190 intersected 0.8 metres of 1,865 grams silver per tonne, part of a larger vein interval starting at 243.6 metres averaging 341 grams silver. Holes QTA 191 and QTA 192, drilled 200 metres west and east of QTA 190, intersected 0.85 metres of 289 grams silver and 1.1 metres of 284 grams silver, respectively. The new zone is open laterally and at depth. The Nieves project is a joint-venture with Blackberry Ventures I.
Cornerstone Capital Resources jumped 38.3% higher to US$0.07 per share on news that its mineral rights to the Caña Brava gold-silver concession in Ecuador have been restored after an appeal. The company’s rights to the property were revoked in November 2008 because they had been mistakenly placed on a list of concessions whose owners allegedly had not filed their preliminary environmental impact statements by the time Ecuador’s 2008 Mining Mandate (moratorium) was declared.
Strong operating cash flow in the third quarter sent shares of OM Group up US$0.67 to US$19.23. The specialty chemicals group generated US$96 million of cash flow from operations in the three months ended Sept. 30 compared to US$22 million in the third quarter of last year. The cash flow figure was the highest in nearly four years and the second-highest in a decade. Diluted earnings per share from continuing operations were US$0.18 compared with negative US$2.18 per share in the third quarter of 2011. The company took advantage of its strong liquidity position to make accelerated debt repayments of US$72 million in the third quarter and an additional US$100 million in October.
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