The S&P/TSX Composite Index held onto its earlier gains during the trading week, edging up 155 points to 12,220.20. The index fell after the U.S. government reported slower growth in the country’s gross domestic product on April 26, which increased at an annualized rate of 2.5% in the first quarter, below the 3% prediction. Both gold and base metal miners closed higher, with the S&P/TSX Global Gold Index adding 6 points to 197.60 and the S&P/TSX Capped Diversified Metals and Mining Index rising 31 points to 785.15. The gold price gained U$56.40 per oz. to end at US$1,462.90.
Eastern Platinum was the most actively traded stock, with 114.2 million shares changing hands after it suspended funding to develop its sole-producing asset — the Crocodile River platinum mine in South Africa — citing weak metal prices and a difficult operating environment. Raymond James analyst Alex Terentiew thinks Eastern will close the underground mine but continue operations such as milling tailings. He trimmed his target price by 33% to 20¢. Eastern lost 3¢ to end at 8¢.
Barrick Gold shares also saw heavy volume, with 26.7 million traded after the company reported first-quarter earnings and adjusted net earnings of US85¢ and US92¢ per share, compared to the net earnings and adjusted net earnings of US$1.04 and US$1.10 per share a year ago.
The miner attributed the lower earnings to dipping realized gold and copper prices, reduced sale volumes and escalating costs. Barrick churned out 1.8 million oz. gold at all-in costs of US$919 per oz. during the quarter. It kept its full-year guidance of 7 million to 7.4 million oz. gold, but decreased the all-in costs to US$950 to US$1,050, down US$50 per oz. from the previous estimate.
Despite a “decent” quarter, Haywood Securities analyst Kerry Smith cut his target price for Barrick by $9 to $34.50, but reiterated a “buy” on the stock. He explained that setbacks at the Pascua-Lama project straddling the border of Argentina and Chile and the Pueblo Viejo mine in the Dominican Republic “will continue to overshadow the company.” Barrick slipped 16¢ to $18.81.
But better-than-expected first-quarter results helped lift Potash Corp. of Saskatchewan up $2.04 to $41.40, making it one of the week’s top value gainers. The miner reported a quarterly profit of $556 million, or 63¢ per share, ahead of the Street’s 59¢ estimate, and BMO’s 57¢. This was the company’s first earnings beat after six straight misses, BMO analyst Joel Jackson notes.
Rockex Mining was one of the week’s percentage winners, adding 50% to end at 8¢ after closing the second half of its previously announced non-brokered private placement. It raised gross proceeds of $394,000 for general working-capital purposes.
TSX most active issues
|Lake Shore Gld||LSG||29719||0.47||0.35||0.4||–||0.06|
|Teck Res B||TCKB||16265||27.64||24.1||26.27||+||1.06|
TSX greatest percentage change
|Cerro Grande M||CEG||52||0.21||0.12||0.21||+||110|
|Lexam VG Gold||LEX||1987||0.09||0.08||0.09||+||38.4|
|White Tigr Gld||WTG||1957||0.04||0.02||0.02||–||50|
|Hard Creek Ni||HNC||244||0.04||0.03||0.03||–||25|
|Meadow Bay Gd||MAY||183||0.25||0.2||0.22||–||18.8|
TSX greatest value change
|Potash Cp Sask||POT||9233718||41.4||+||2.04|
|Teck Res A||TCKA||12596||28.36||+||1.64|
|Teck Res B||TCKB||16265135||26.27||+||1.06|
|Horizns G Bear||HGD||2980744||20.98||–||1.79|
|Labdr I-Ore Ro||LIF||484938||32.35||–||0.39|
|Intl Minls Crp||IMZ||45561||2.92||–||0.31|
|China Gold Int||CGG||1189239||2.76||–||0.26|
|Alderon Iron O||ADV||698122||1.05||–||0.19|