Market News

Toronto Stock Exchange

Volatility reigned supreme and investors rattled by troubles south of the border and across the Atlantic sent the S&P/TSX Composite Index down 332 points to 11,871.23 points for the period. 

A disappointing payroll report put the slow growth theme on the front burner for Canada’s largest trading partner, and across the ocean the news wasn’t much better. 

Toronto stocks followed the global trend downwards as investors worried over how well the sovereign debt crisis would be handled, with two new governments coming to power in France and Greece. 

The election results were read as a sign that the countries’ populations wouldn’t tolerate the path of austerity favoured by Germany. 

The bleaker global picture did little to help gold, and the metal fell US$18 to US$1,645.20 per oz. The loss in value hit gold miners, and the S&P/TSX Global Gold Index was off 11 points to 299.43. 

Base-metal miners also suffered a price drop in copper, aluminum, nickel, tin, lead and zinc, and the S&P/TSX Capped Metals & Mining Index fell 74 points to 982.08 points. 

But the news wasn’t all bad for miners, and Allana Potash made a 35% gain to 69¢ after the latest resource estimate from its Dallol potash project in Ethiopia. The company announced an updated resource estimate that puts measured and indicated resources at 1.3 million tonnes, with an average grade of 19.32% potassium chloride (KCI) for 250 million tonnes of contained KCI. The project now boasts inferred resources of 588.15 million tonnes grading 18.56% KCI.

Scorpio Mining improved its results from last quarter, which had investors in a buying mood. The company’s shares gained 19% to finish at $1.07 after the silver miner announced a 13% increase in revenues to $15.6 million over the previous quarter. The increase came from better grades and higher metal prices. The results also showed low cash costs of $7.78 per oz., which beat the previous quarter’s US$10.81 per oz.

On the downside, Gabriel Resources -—which is trying to build its large-scale Rosia Montana gold mine in Romania lost 32% of its market capitalization as its share price sunk to $1.82. The slump came as a centre-left cabinet geared up to take office in the country. The new cabinet said it plans to reassess the project so that “decisions are in-line with the national interest, environment protection regulations and European legislation.” 

Prime minister-designate Victor Ponta has already threatened to block the project once he comes to power. Onlookers believe the project’s status won’t be truly known until after November’s general elections.

TSX most active issues

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
 Torex Gold  TXG  21283  1.85  1.55  1.71  -0.08
 Cline Mng CMK   18537  1.22  0.87  0.88  -0.17
 Lundin Mng  LUN  17007  5.02  4.51  4.56  -0.32
 Yamana Gold  YRI  13687  14.64  13.47  14.09  -0.44
 Kinross Gold  K  11442  9.00  8.32  8.34  -0.55
 Barrick Gold  ABX  11242  40.31  37.03  37.69  -2.19
 Uranium One  UUU  10927  3.04  2.81  2.89  +0.04
 Eldorado Gold  ELD  10919  14.13  12.76  13.15  -0.94
 First Quantum  FM  10884  20.92  18.63  18.82  -2.31
 Goldcorp  G  9871   38.27  35.38 36.43   -1.95

TSX greatest percentage change

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
Allana Potash AAA 8100 0.74 0.50 0.69 +35.2
 Liberty Mines LBE 242 0.12 0.10 0.12 +20.0
INV Metals INV 434 0.19 0.14 0.155 +19.2
Scorpio Mining SPM 2663 1.19 0.90 1.07 +18.8
Geovic Mng GMC 590 0.115 0.095 0.10 +17.6
Zincore Mtls ZNC 3022 0.205 0.165 0.20 +17.6
Energizer Res EGZ 3786 0.365 0.275 0.335 +17.5
TVI Pacific TVI 962 0.035 0.03 0.035 +16.6
Dejour Enterp DEJ 273 0.35 0.29 0.34 +13.3
Pac NW Cap  PFN 1235 0.14 0.11 0.13 +13.0
White Tigr Gld WTG 4029 0.305 0.19 0.195 -35.0
Gabriel Res GBU 6369 2.73 1.65 1.82 -31.8
Petaquilla Mnl PTQ 3425 0.435 0.30 0.32 -25.5
Diamond Fields DFI 236 0.085 0.065 0.065 -23.5
Coalspur Mines CPT 1125 1.75 1.38 1.40 -21.7
Canarc Res CCM 387 0.165 0.13 0.13 -21.2
Aquila Res AQA 264 0.415 0.33 0.335 -20.2
Stockport Expl SPT 16 0.08 0.08 0.08 -20.0
Orocobre ORL 27 1.60 1.36 1.37 -19.4
Candente Gold CDG 158 0.26 0.19 0.20 -18.3

TSX greatest value change

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 VOLUME WEEK
CLOSE CHANGE
Horizns G Bear HGD 1707136 12.72 +0.98
Russell Metals RUS 772068 27.40 +0.80
Alamos Gold AGI 1899282 18.58 +0.52
Cameco Corp CCO 22.37 +0.51
Potash Cp Sask POT 7991286 42.32 +0.47
Foraco Intl FAR 181125 5.25 +0.45
Primero Mng P 561672 2.99 +0.27
Quest Rare Mnl QRM 391499 2.15 +0.19
Allana Potash AAA 810013 10.69 +0.18
Intl Tower HilI TH 319526 3.95 +0.17
Inmet Mining IMN 1100817 50.25 -4.75
Agrium AGU 2398441 84.83 -2.32
First Quantum FM 10884026 18.82 -2.31
Barrick Gold ABX 11241549 37.69 -2.19
Teck Res BT CKB 7755002 34.79 -2.07
Goldcorp G 9870794 36.43 -1.95
Walter Energy WLT 24283 64.01 -1.71
Coeur d Alene CDM 40666 19.73 -1.65
Pan Am Silver PAA 1702807 17.45 -1.57
Dundee Prec Mt DPM 3907076 7.09 -1.51

TSX Venture Exchange

The S&P/TSX Venture Composite Index slipped back to negative territory in the period, ending down 7.71 points at 1,405.05 after three days of losses outweighed two days of gains. Volume was down to an average of 77.3 million shares daily after spiking to 102 million the week before following Iamgold’s proposed takeover of Trelawney Mining and Exploration.

Trelawney was again the most active company with 23.1 million shares traded. There looks to be little speculation of a rival bid, with Trelawney’s share price holding steady at just under the $3.30 bid price, closing up a penny at $3.29. Further committing Trelawney to the deal is a non-solicitation clause, the right to match covenants and a $21-million break fee. Analysts reacted somewhat negatively to the deal, citing the low-grade and early stage nature of the deposit, and potential cost overruns and permitting risks.

Amex and Venture-listed Gold Reserve climbed 41¢ to $4.55 for the period’s second-highest value gains after entering into an option agreement with Soltoro. Gold Reserve signed on to earn 51% of the 115.6-sq.-km La Tortuga property in Mexico’s Jalisco state by paying US$650,000 cash and US$3-million in exploration spending. Venezuela expropriated Gold Reserve’s main Brisas property in 2009, leading to the company’s  downgrade from the TSX to the Venture last year, and in search of a new project. The company’s Amex listing also came close to being revoked, but the exchange gave the company until the end of 2012 to become compliant. Soltoro ended down 6¢ at 52¢.

Bolero Resources was also up after announcing an option agreement and climbing 7¢, or 70%, to 17¢ with 4.8 million shares traded, after securing a graphite property in northern Ontario. The 50-sq.-km graphite prospect fully surrounds Northern Graphite’s 30-sq.-km Bissett Creek  property, which helped propel Northern’s shares from 90¢ in mid-January to an early April peak of $3.72. Bolero can earn in 100% of the property by paying $100,000 and issuing a million shares to GeoInvest Enterprises. Bolero did not specify what makes the property prospective to graphite in its announcement, other than its proximity to Bissett.  

Penny-stock New Guinea Gold saw 7.9 million shares traded to become the second-most active stock on the Venture after announcing a management cease-trade order and updating its potential acquisition by PNG Gold. Believing the takeover would have been complete by now, management has not prepared the necessary financials for the exchange. PNG Gold had offered to issue 0.125 of a PNG share for each New Guinea share held. New Guinea closed unchanged at 2¢ while PNG closed down a penny at 18¢.

TSX-V most active issues

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
Trelawney M&Ex TRR 23075 3.29 3.27 3.29 +0.02
New Guinea Gld NGG 7868 0.02 0.01 0.015 0.00
Aurcana Corp AUN 7142 1.05 0.93 0.97 +0.02
Sandstorm Gld SSL 5068 1.90 1.73 1.82 +0.01
East Asia Mnls EAS 4936 0.39 0.305 0.36 +0.05
Diamond Frank DOD 4779 0.06 0.035 0.035 0.00
Bolero Res BRU 4773 0.21 0.095 0.165 +0.07
Azteca Gold AZG 4277 0.01 0.005 0.005 0.00
Encore Ren Res EZ 3972 0.025 0.02 0.025 +0.01
North Am Tung NTC 3442 0.38 0.30 0.305 -0.03

TSX-V greatest percentage change

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
Santa Fe Metls SFM 275 0.055 0.035 0.055 +83.3
Bolero Res BRU 4773 0.21 0.095 0.165 +73.6
Copper One CUO 393 0.27 0.16 0.27 +68.7
Encore Ren Res EZ 3972 0.025 0.02 0.025 +66.6
Nitinat Mnls NZZ 16 0.15 0.085 0.15 +66.6
Prominex Res PXR 564 0.045 0.025 0.04 +60.0
Canadn Plat CPC 184 0.08 0.05 0.08 +60.0
Iconic Mnls ICM 198 0.125 0.08 0.12 +50.0
Dynasty Gold DYG 464 0.03 0.02 0.03 +50.0
Candorado Oper CDO 1059 0.035 0.02 0.03 +50.0
Anglo-Bomarc ANB 119 0.10 0.06 0.06 -47.8
Valhalla Res VH 145 0.105 0.06 0.06 -40.0
Alpha Gold ALQ 168 0.035 0.015 0.015 -40.0
Red Mile Mnls RDM 122 0.06 0.04 0.04 -38.4
Guerrero Expl GEX 685 0.10 0.075 0.075 -37.5
Typhoon Expl TYP 24 0.285 0.20 0.22 -34.3
Electra Gold ELT 193 0.015 0.01 0.01 -33.3
Astr
al Mining
AA 145 0.09 0.06 0.06 -33.3
Invenio Res IVO 168 0.09 0.06 0.06 -33.3
Richmond Mnls RMD 94 0.015 0.01 0.01 -33.3

TSX-V greatest value change

 VOLUME WEEK
CLOSE CHANGE
Pac Booker Min BKM 402471 3.62 +1.32
Gold Reserve GRZ 32363 4.55 +0.41
Northern Graph NGC 2302542 2.51 +0.33
Copper Fox Mtl CUU 2780522 1.35 +0.32
Giyani Gold WDG 714605 1.40 +0.29
Anfield Nickel ANF 60750 3.98 +0.25
Flinders Res FDR 577797 2.33 +0.24
Kaminak Gold KAM 1689187 1.99 +0.23
Gold Canyon GCU 2520388 1.75 +0.22
Atac Res ATC 762497 2.87 +0.21
Lumina Copper LCC 297232 12.11 -1.36
Chesapeake Gld CKG 40038 11.61 -0.69
Maudore Minls MAO 70250 3.72 -0.43
Tasman Metals TSM 323607 1.78 -0.24
Amarillo Gold AGC 97631 0.81 -0.18
SilverCrest Mn SVL 561860 2.11 -0.18
Red Tiger Mng RMN 75050 0.69 -0.15
Midway Gold MDW 30950 1.25 -0.15
TomaGold LOT 2296132 0.27 -0.13
Esperanza Res EPZ 233696 1.22 -0.12

U.S. Markets

It was one of the worst weeks on Wall Street this year. Ahead of key elections in Europe that threatened to derail advocates of tough austerity measures in France and Greece, U.S. payroll data showed hiring in the U.S. slowed for a third-straight month, dimming hopes that the economy was turning the corner. The S&P 500 Index fell 2.44%, or 34.26 points, to 1,369.10 in its poorest performance this year. The Nasdaq Composite Index fell 3.77%, or 112.86 points, to close at 2,956.34 in its sharpest weekly decline since November, while the Dow Jones Industrial Average slid 1.44%, or 190.04 points, to 13,038.27. The Philadelphia Gold and Silver Index was off 5.46%, or 9.05 points, at 156.76. 

Unusually mild winter weather and decade-low natural gas prices contributed to the fall in the fortunes of coal miners Arch Coal and Alpha Natural Resources. Shares of Arch Coal — the most actively traded stock of the week — dropped US$1.38 to US$8.08 per share after releasing disappointing first-quarter results. Net income in the first quarter reached US$1.2 million, or $0.01 per diluted share, compared with net income of US$55.6 million, or $0.34 per diluted share in the first quarter of 2011. Alpha Natural Resources fell US$1.42 to close the week at US$14.45 per share after reporting a first-quarter net loss of US$29.1 million, or US$0.13 per diluted share, compared to net income of US$49.8 million, or US$0.41 per diluted share last year.  

Compass Minerals posted the largest gain of the week, climbing US$1.22 to close at US$76.68 per share on no news. In late April Compass reported net earnings of US$39.9 million, or US$1.19 per diluted share, compared with US$56.5 million, or US$1.69 per diluted share in the first quarter of 2011. The results included losses caused by a tornado that struck the company’s salt operations in Ontario last August. Excluding the effects of the tornado, the company estimated that first-quarter net earnings would have been US$49.5 million, or US$1.48 per diluted share. The mild winter curtailed de-icing demand and limited the company’s salt sales to US$254.3 million, down from US$332.4 million in the 2011 quarter.

U.S. most active issues

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
Arch Coal* ACI 98201 10.26 7.78 8.08 -1.38
Alcoa* AA 97626 10.01 9.34 9.37 -0.38
Freeport McMo* FCX 79040 38.69 36.01 36.40 -1.73
Alpha Nat Res* ANR 54383 16.69 14.29 14.45 -1.42
Kinross Gold* KGC 44820 9.125 8.36 8.39 -0.65
Barrick Gold* ABX 38610 40.76 37.45 37.89 -2.77
Peabody Enrgy* BTU 35673 31.97 28.96 29.14 -1.06
Newmont Mng* NEM 29772 48.365 45.34 46.16 -1.70
Goldcorp* GG 28490 38.88 35.82 36.56 -2.56
Potash C Sask* POT 27790 44.28 41.92 42.47 -0.21

U.S. greatest percentage change

 VOLUME WEEK
HIGH LOW CLOSE CHANGE
Cornerstone C* CTNXF 85 0.076 0.062 0.075 +33.9
Elray Res* ELRA 9848 0.009 0.004 0.005 +25.0
El Capitan Pr* ECPN 897 0.27 0.21 0.26 +23.8
Infrastrc Mat* IFAM 153 0.04 0.035 0.04 +21.2
Geovic Mng* GVCM 269 0.117 0.086 0.10 +14.9
Primero Mng* PPP 122 3.06 2.74 3.02 +8.6
Dejour Enterp* DEJ 486 0.369 0.301 0.335 +8.4
Fischer-W Gld* FWG 319 0.04 0.032 0.039 +8.3
Quest Rare Mn* QRM 1263 2.22 1.97 2.15 +7.5
Silver Dragon* SDRG 2393 0.033 0.027 0.029 +7.4
Tri-Valley* TIV 3298 0.144 0.075 0.081 -41.7
Linux Gold* LNXG 48 0.04 0.021 0.025 -28.5
Petaquilla Mn* PTQMF 1126 0.441 0.31 0.332 -20.9
Canarc Res* CRCUF 393 0.168 0.136 0.14 -19.5
Extorre Gold* XG 904 4.
45
3.49 3.52 -18.8
China Shen Zh* SHZ 173 1.29 1.01 1.05 -18.6
Uranerz Energ* URZ 2437 1.82 1.51 1.54 -14.9
Mechel* MTL 2953 8.75 7.30 7.44 -14.6
Arch Coal* ACI 98201 10.26 7.78 8.08 -14.5
New Gold* NGD 14508 9.58 8.45 8.59 -14.2

U.S. greatest value change

 VOLUME WEEK
CLOSE CHANGE
Compass Mnls* CMP 603681 76.68 +1.22
Pac Booker Mn* PBM 17370 13.77 +0.92
Consol Energy* CNX 24975326 33.38 +0.70
Gold Reserve* GRZ 441017 4.52 +0.26
Primero Mng* PPP 121713 3.02 +0.24
Cameco Corp* CCJ 15162922 22.50 +0.22
Quest Rare Mn* QRM 1263086 2.15 +0.15
Intl Tower Hi* THM 378251 3.94 +0.10
Mines Managem* MGN 182112 1.63 +0.06
El Capitan Pr* ECPN 896763 0.26 +0.05
Randgold Res* GOLD 3274555 81.62 -9.78
Rio Tinto* RIO 3262730 51.91 -5.05
Cliffs Nat Rs* CLF 18856145 58.27 -3.88
Agrium* AGU 1041847 85.19 -3.61
Intrepid Pots* IPI 1142493 21.99 -3.05
Barrick Gold* ABX 38610174 37.89 -2.77
Mesabi Trust* MSB 567712 27.98 -2.65
Teck Res B* TCK 13660693 34.92 -2.64
Goldcorp* GG 28490249 36.56 -2.56
BHP Billi-BHP* BHP 15803556 71.73 -2.52
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