Toronto Stock Exchange Market slips in spite of gold’s breakout to

The price of gold today climbed more than $10 with New York’s Comex November contract closing at $421.80(US) and most of Toronto’s gold issues followed. But that wasn’t enough to carry the entire TSE: although the gold and silver index was up 168.3 points to close at 5993.4, the TSE composite 300 index was off 17.9 points to close at 3378.8.

A weak U.S. dollar, which lost ground today against all major currencies, was the main reason for gold’s strong showing. Platinum futures in New York were also up sharply, adding impetus to gold strength.

The only other major index up today was the Metals and Mineral index, up 7.47 points to close at 2923.4.

The gold and silver index’s showing today is the fourth straight day of gains. Nevertheless, it remains far below the 1988 high of 7547.47 and not much better than the low of 5432.14.

The market this week was generally good to mining issues, particularly golds.

Placer Dome continued to be among the most active mines. Today it traded 522,844 shares to close up a quarter at $17.25. Awash in cash, it has been the subject of takeover rumors — the trouble is no one seems to be sure whether it is doing the taking or being taken. The big cash position seems to work either way. For the week prior to today, Placer Dome traded 978,700 shares and moved up $1.25.

The same rumor-mongers are working on Lac Minerals. It, too, was up gaining 88 to close at $12.62 during the week ended Nov 1. Today it made further gains closing at $13 on 92,399 shares. There’s little doubt where Lac fits into the takeover rumor mill, however. It is ripe for the picking with no controlling shareholder and what many say is a depressed price, Hemlo lawsuit notwithstanding. Nevertheless, it probably won’t be until after the Supreme Court of Canada hands down its decision on the lawsuit that any move will be made on this one. Of course no one knows when that will be.

American Barrick was a big percentage gainer today picking up $1 to close at $22 on 124,842 shares traded. During the previous week it gained 38 on 173,600 shares.

The volume leader today, however, as it was for the week, is Inco. It gained a dollar today to close at $36.25 on 658,234 shares. Over the previous five trading days it traded an additional 1,667,800 shares and gained 12 * That’s well over $80 million dollars of trading in a single security.

Apparently investors are jockeying for the best way to play Inco’s recapitalization proposal. While there’s stiff opposition to the plan from some quarters, there’s little doubt it will be approved by shareholders. If it does go through, it dramatically changes the outlook for Inco — so much so that analyst John Lydall at Marathon Securities suggests Inco may be a good speculative stock afterwards.

New Quebec Raglan, the Falconbridge affiliate that is probably as a good a barometer of nickel markets as any because of the undeveloped nickel properties it holds in northern Quebec, was up 45 on the week to close at $2.10 on 24,400 shares. Today it was unchanged as only 1,000 shares changed hands.

While speaking of Falconbridge, the base metal miner is close to spinning off some of its gold holdings into a separate company, Falconbridge Gold. The plans were announced some time ago, but a preliminary prospectus is currently in the hands of the Ontario Securities Commission. Falco Gold would hold the two gold mines Falconbridge acquired when it bought Kidd Creek Mines, the Hoyle Pond and Owl Creek mines.

Other base metal miners that stepped into the limelight this week include Mineral Resources International. It’s prize Nanisivik zinc mine on Baffin Island in Canada’s Arctic, which will probably be mined out in about five years, make it a good play on zinc markets, but because it’s 50% owned by Conwest Exploration, it isn’t known as a big trader. MRI, however, was up 40 to close at $4.55 on 223,500 shares during the week. Today it lost a dime on 30,985 shares to close at $4.45.

Metall Mining, 63% owned by Germany-based Metallgesellschaft, was also notable for its uncharacteristic trading activity — 124,700 shares as it slipped 12 to close at $9.62 during the week. Today it was up 25 to close at $9.88 on another 10,655 shares.

A good mover this week was Sikaman Gold. It says a feasibility study shows it’s Bogosu gold project in West Africa could be up and running by the end of 1989. It will be funded by an agency of the World Bank. Sikaman also says it has an agreement to buy gold mine tailings at Snow Lake, Man., from Nor-Acme Mines and could produce 45,000 oz annually from the relatively high-grade waste material beginning in mid-1989.

The continuing saga of Dickenson Mines and Wharf Resources is still tickling the market’s fancy. In this will-they-won’t-they proposed amalgamation, Dickenson stock has slipped as low as $4.20, although it was up to $4.35 this week on 153,900 shares and gained antoher 20 today on 17,500 shares. Wharf, on the other hand, was up 40 to close the week at $4.90 and added 10 today on another 40,800 shares.