STOCK MARKETS — TSE 300 composite claws back above 6,000 mark — Bre-X blackens eyes of jungle explorers; Inco, Rio hitched to nickel’s rise

Not since the report period of March 19 has the Toronto Stock Exchange 300 composite index risen above the 6,000 mark.

It returned to that peak during the report period ended May 6, rising 226.4 points to close at 6,129.96. The greatest volume in trading occurred on May 6, when 149.1 million shares crossed the floor. The activity was fueled by the frenzied renewal of trading of Bre-X Minerals shares.

The anxiety of investors awaiting the Bre-X audit from Strathcona Mineral Services failed to stall the momentum in the gold and precious metals sub-group. Although the sub-index suffered a drop of 74.4 points on May 7, it was up 135.66 points to close the week at 8,909.13. Gold bullion also increased in value over the previous week, with the yellow metal fixed on May 7 at US$340.65 per oz., up 20 cents. Silver saw a modest increase of 6 cents to US$4.72 per oz., while platinum was down $1.25, finishing at US$373 per oz.

Bre-X believers received a rude awakening from Strathcona, which declared that the Busang project is, in effect, a pillar of salt. The company lost 98% of its market capital when trading resumed on May 6 on a volume of 84.5 million shares. The issue closed at 10 cents, having lost $3.70. Parent Bresea Resources fell $1.52, or 93%, to land at 42 cents. Not surprisingly, it had the third-highest volume, with 9.9 million shares crossing the floor.

Also affected was former minority-stake holder Minorca Resources, which saw $1.10 chopped from its share value. Minorca closed at 95 cents.

Shareholders of other companies active in Kalimantan divested themselves as well. Scorpion Minerals lost 55% of its market capitalization, closing at $1.65, and Montreal-listed Tandem Resources, which holds properties in joint-Venture with Bresea, suffered a 31% drop in value, finishing at 40 cents.

The flight from the juniors seems to have benefited senior and intermediate producers, most of which gained in value. Barrick climbed $1.25 to $32.45 and Euro-Nevada rose an equvalent amount to close at $39.25. Placer Dome gained $1.95, finishing at $24.50, TVX Gold gained 60 cents, to close at $8.35, and Kinross Gold was up 10 cents to $7.55.

The Canadian dollar gained 80 basis points against its American counterpart.

The Loony had a noon rate on May 7 of US72.38 cents. The dollar was down against other major foreign currencies.

The report period brought good news to base metal miners, as the TSE’s metals and minerals sub-group gained a hefty 207.6 points, to finish at 5,370.32. On May 7, nickel was selling at US$3.35 per lb. on the London Metal Exchange — up 7 cents; copper increased by a penny, selling at $1.10 per lb.; and both zinc and lead broke even, with the former worth 57 cents and the latter 28 cents per lb.

Hot on the heels of nickel’s surge in price, Inco gained $2.30 to close at $45.75. Falconbridge, also a benefactor of nickel’s climb, rose $1.60 to finish at $29.85, while Teck B series shares rose 90 cents to $28.65. Rio Algom climbed $1.20 to $36.15.

Among other senior companies, Potash Corp. of Saskatchewan enjoyed the highest gain, tacking on $5.75 to end the report period at $113. Cameco came in a close second, with an increase of $5.40. The issue was worth $52.40 at the end of trading on May 6.

The highest percentage gain went to Asbestos Corp., a 54.6%-owned subsidiary of Montreal-listed Mazarin Mining. The value of Asbestos shares increased by a staggering 225%, or $12.60, to finish at $18.20.


Be the first to comment on "STOCK MARKETS — TSE 300 composite claws back above 6,000 mark — Bre-X blackens eyes of jungle explorers; Inco, Rio hitched to nickel’s rise"

Leave a comment

Your email address will not be published.


By continuing to browse you agree to our use of cookies. To learn more, click more information

Dear user, please be aware that we use cookies to help users navigate our website content and to help us understand how we can improve the user experience. If you have ideas for how we can improve our services, we’d love to hear from you. Click here to email us. By continuing to browse you agree to our use of cookies. Please see our Privacy & Cookie Usage Policy to learn more.