TSX slides, June 1-5

Canada’s benchmark stock index fell below 15,000 for the first time since mid-May, driven lower by concerns about how the Greek debt crisis will affect the eurozone, and strong jobs data in the U.S. that has caused many to believe the Fed will raise rates sooner rather than later. The S&P/TSX Composite Index dropped 0.4% to 14,957.16. The S&P/TSX Global Gold Index lost 3.6% to finish at 159.44 and the S&P/TSX Global Mining Index fell 2.1% to 64.13. By contrast, the S&P/TSX Capped Diversified Metals and Mining Index advanced 3.2% to 750.98.

Shares of First Quantum Minerals were the most traded and jumped the most in value. The company completed its $1.4-billion equity financing at a price of $16.25 per share. Most of the proceeds will be used to reduce debt. The funds will also be used for capital investment in existing production facilities and development projects, and in strategic initiatives to enhance its growth pipeline. Its shares climbed $1.21 to $17.29.

Detour Gold’s shares gained 53¢ to $13.82 on news that its open-pit mine has exceeded budget rates for both mill throughput and mining during the last three months. Mill throughput rates averaged 59,370 tonnes per day during the three-month period, exceeding design capacity of 55,000 tonnes per day, while mining rates averaged 271,000 tonnes per day, exceeding the annual budget rate of 238,000 tonnes per day. On the mining side, production drilling rates have surpassed 3 km per day over the last three months. For the rest of 2015, Detour is targeting mining rates of between 250,000 and 290,000 tonnes per day, and at these higher rates, access to the higher-grade ore is expected in the third quarter, not the fourth quarter. Management expects second-quarter gold production within its guidance of 110,000 to 120,000 oz. The company also said it would produce between 475,000 and 525,000 oz. this year at total cash costs of US$780 to $850 per oz. sold, and all-in sustaining costs of US$1,050 to US$1,150 per oz. sold.

Seabridge Gold announced core drilling at its KSM project in B.C., which lifted its shares 45¢ to $8.14. The goal is to determine the potential for a high-grade core zone beneath the Mitchell deposit, which is KSM’s largest. In the last two years, Seabridge has targeted higher-grade core zones beneath KSM’s near-surface porphyry deposits, finding Deep Kerr and the Iron Cap Lower Zone. The program also seeks to enlarge and refine the block-cave mining potential for Deep Kerr and the Iron Cap Lower Zone.

Argex Titanium’s shares plunged 43% to 22¢ on news of an equity financing. The proceeds will be used for engineering work associated with long-lead items, and corporate purposes, before the company builds its first commercial titanium dioxide plant in Quebec.


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