TSX slips, Oct. 14-18: First Majestic, Wesdome, Alamos Gold, Teck

The S&P/TSX Composite Index fell 0.23% to 16,377.10. The S&P/TSX Global Mining Index lost 1.29% to 73.48 and the S&P/TSX Global Base Metals Index dropped 0.60% to 96.86. The S&P/TSX Global Gold Index rose 1.71% to 210.71, and spot gold remained relatively flat at US$1,489.60, up 80¢.

First Majestic Silver’s shares jumped $1.28 to $13.46 on the back of third-quarter production results. The company reported production of 6.6 million equivalent oz. silver — a 4% increase over the second quarter. Third-quarter production consisted of 3.4 million oz. silver, 35,791 oz. gold, 1.9 million lb. lead and 1  million lb. zinc. Production to the end of the third quarter now totals 19.3 million equivalent oz. silver, or 77% of the company’s guidance midpoint of producing 24.4 to 26 million ounces.

Wesdome Gold Mines climbed 67¢ to $6.61 per share. The company, which is producing gold in Ontario from two mines, the Eagle River underground mine and the Mishi open pit, produced 28,910 oz. in the third quarter, up from 19,795 oz. in the third quarter of 2018.

Year-to-date production has reached 70,356 oz., and the company has raised its 2019 production guidance to a range of 88,000 to 93,000 oz. gold. Cash costs are expected to come in at US$640 per oz. and all-in sustaining costs at US$985 per ounce. The company is investing in exploration, with five underground drills and one surface rig at Eagle River, and five underground rigs at its Kiena mine.

Shares of Alamos Gold fell 84¢ to $6.66 due to problems at its Kirazli project in Turkey. The company announced on Oct. 14 that it had suspended all construction activities at the project until its mining concession, which expired on Oct. 13, is renewed. The renewal is required from the same government department that granted the operating permit for Kirazlı in March. Alamos said given the uncertainty about the timing of the concession renewal, “initial production from Kirazlı has been delayed from the previous guidance of late 2020.”

Teck Resources received regulatory approval for a share buyback program involving its Class B subordinate voting shares. Teck can buy up to 40 million of the shares between Oct. 28, 2019, and Oct. 27, 2020. During Teck’s normal course issuer bid — which started on Oct. 10, 2018, and ended Oct. 9, 2019 — Teck bought 22.47 million Class B shares on the open market at a volume-weighted average price of $28.69 per share. Teck’s shares closed at $21.62 apiece, down 52¢ during the trading week.


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