TSX posts modest gain, April 20-24

Solid corporate earnings pushed global equity markets higher and Canada’s main stock index was no exception, gaining 0.3% to finish at 15,408.33. The S&P/TSX Global Mining Index climbed 3.63% to 66.61, and the S&P/TSX Capped Diversified Metals & Mining Index advanced 6.32% to 749.87. Gold prices hit a one-month low on continued uncertainty about the US Federal Reserve’s next move on interest rates, pushing down the S&P/TSX Global Gold Index by 1.90% to 161.77.

Iron ore posted its best week since 2012 and the mini-rally helped lift the shares of Labrador Iron Ore Royalty by $2.41 to $14.70. The company also reported first-quarter production and sales figures for the Iron Ore Co. of Canada on April 21. IOC’s concentrate for sales and pellet production were 28% and 15% higher than the first quarter of 2014 due to “increased asset reliability across the value chain, lower strip ratio and higher weight yield,” Labrador Iron Ore Royalty reported. Compared with the fourth quarter of 2014, however, IOC’s concentrate sales and pellet production were down by 5% and 7%, due to seasonal factors.

Shares of Dominion Diamond were up $1.36 to $23.54, despite lower processing volumes reported in the first quarter of 2015 at its 40%-owned Diavik mine. Processing volumes were 19% lower than the same quarter of the previous year due to three factors: additional stockpiled ore available and processed during the same period last year; mining progressed through an area of higher-than-normal dilution in the A-418 orebody; and upgrades to the crusher plant to improve throughput led to a reduced processing during the quarter. Looking ahead, the company said the A-21 pipe is progressing according to plan and that mining this year will be exclusively underground, with 0.8 million tonnes sourced from A-154 North, 0.4 million tonnes from A-154 South and 0.9 million tonnes from A-419. Dominion also noted that in addition to the 6.7 million carats that are expected from run-of-mine ore this year, there will be production from coarse ore rejects. Based on historical recovery rates, the tonnage of processed material expected this year will be 0.3 million carats. 

Shares of Teck Resources gained $1.04 to $17.45. The company reported it had cut its dividend to 15¢ per share. The move brings dividend payout and yield “more in line with current commodity prices and outlook, and ensures balance-sheet strength and flexibility for future capital expenditures, or other capital allocation opportunities.” Teck reported first-quarter results with adjusted profit attributable to shareholders of $64 million, or 11¢ per share, compared with $105 million, or 18¢ per share, in 2014. Profit attributable to shareholders was $68 million (12¢ per share), compared with $69 million (12¢ per share) a year ago.


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