TSX slips, Jan. 8-12

The S&P/TSX Composite Index fell 0.25% to finish at 16,308.18. The S&P/TSX Global Mining Index gained 4.19% to 76.85 and the S&P/TSX Global Gold Index rose 2.03% to 200.62, with spot gold rising US$18.60 per oz. to close at US$1,337.40 per oz. At the end of the trading week, the LME copper price was up 21.7% year-on-year, zinc was up 25.8% year-on-year, and nickel was up 24.1% year-on-year.

Higher gold and base metal prices lifted many boats. Teck Resources jumped $4.32 per share (12.75%) to $38.20 per share, on no company related news. Zinc producer Nexa Resources and streaming and royalty company Altius Minerals also gained on no news, rising 75¢ to $25.57 per share and 74¢ to $15.30 per share. Nexa owns five underground zinc mines. Two of its mines, Cerro Lindo in Peru and Vazante in Brazil, are among the 12 largest zinc mines in the world. Altius holds royalties and streams from 15 operating mines that produce a variety of metals including copper, zinc, nickel, cobalt, iron ore, potash, thermal and metallurgical coal.

Pan American Silver rose $1.40 to $20.77 per share. The company reported that it achieved decade-low consolidated cash costs of US$4.55 per oz. in 2017, and annual silver production as targeted of 25 million ounces. The company expects silver production over the next three years to grow at an annual compounded rate of 8%, reaching 30.5 million to 33 million oz. by 2020.

After a difficult 2017, Ghana-focused Asanko Gold rose 22.9% to $1.02 per share, on no news. At the end of December, the company announced it had filed a preliminary short form base shelf prospectus with Canada’s securities commissions. The base shelf prospectus will allow Asanko to offer up to US$300 million of common shares, warrants, subscription receipts, debt securities and units, or any combination thereof, over a 25-month period. In an email to The Northern Miner, Alex Buck, Asanko’s manager of investor and media relations, said the prospectus gives the company “additional optionality and flexibility over the next two years to fund our future growth projects,” adding that “it is normal course of business for public issuers to have a shelf prospectus filed and is a sensible tool to have for a gold company at our stage of development.” As is often the case, she noted, “the amount incorporates a sufficient buffer to allow us to respond to opportunities that might arise.”

Shares of Imperial Metals fell 36¢ (12%) to $2.65 on 2017 production results. Its Red Chris mine produced 74.64 million lb. copper in 2017 (compared with 83.61 million lb. copper in 2016); 33,416 oz. gold (47,088 oz. gold in 2016); and 133,157 oz. silver (190,624 oz. silver in 2016). Its Mt. Polley mine produced 19.07 million lb. copper last year (25.34 million lb. copper in 2016); 48,009 oz. gold (46,444 oz. gold in 2016); and 36,626 oz. silver (90,125 oz. silver in 2016).


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