STOCK MARKETS — Mines rebound to outpace market

The gold and base metal issues on the Toronto Stock Exchange finally bounced back after several weeks on the canvas to lead the market. Over the report period Nov. 6-12, the TSE 300 composite index gained 142.50 points, or 2.5%, as the golds rose 6.1% and the metals and minerals rose 4.9%. The market traded daily volumes at or above 100 million shares, except for lighter trading on the Remembrance Day holiday.

The Canadian dollar eased off its recent high of US75.15 cents, reached on Nov. 6, and was trading at US74.98 cents at noon on Nov. 13. The Bank of Canada helped matters along by cutting the overnight loan rate to 3.25% on Nov. 8, and, with rates at their lowest point since the 1960s, the stock market responded with record high closes on the three succeeding days. The other major foreign currencies also recovered against the loony last week.

The gold price also staged a modest recovery on the London bullion market this past week, adding $4.60 for a fixing price of US$382.50 per oz. on the morning of Nov. 13. Platinum also came charging back, finishing the week $8.75 higher at US$388.00 per oz.; silver added 11 cents, rising to US$4.90 per oz.; and long-suffering palladium was back up to $119.25 per oz.

The TSE gold and precious minerals sub-index was sharply higher, closing at 11,695.22 on Nov. 12 for a 667.61-point increase. More than half that increase came on the final trading day of the period, when the golds rose 381.34 points.

Placer Dome, $3.10 higher at $35.25, was the most active of the golds, with 8.5 million shares traded over the five days. Barrick Gold was $3.35 higher at $37.85 on a 7.3-million-share volume. Many of the middle-tier producers recovered strongly, with TVX Gold 75 cents higher at $10.45, Kinross up 80 cents at $10.45, Agnico-Eagle $1.20 better at $19.15, Greenstone Resources rising $2.20 to $19.70, and Prime Resources 70 cents higher at $10.10. Bema Gold was down 15 cents at $7.80.

Goldcorp, which issued more news of exploration success at its Red Lake mine, was up 30 cents at $12.45. The company has also bought 2.4 million shares of Wilanour Resources for $1.2 million, and Wilanour (which, apart from the Goldcorp transaction, traded lightly this week) was up 20 cents to 55 cents.

Base metals gained considerable ground on the London Metals Exchange over the report period, with copper up 6 cents to US97 cents per lb. in the Nov. 13 morning ring. Unexpected removals of LME warehouse copper triggered the rally, which brought copper back to US$2,100 per tonne, a price it had not seen since September. Nickel was also higher, up 5 cents to US$3.23, while zinc was unchanged, and lead was down fractionally.

The TSE metals and minerals sub-index was up 247.46 points to finish the trading period at 5,289.34. Gains in the sector almost matched the golds, with the bellwether, Inco, up $2.55 to $44.15, Noranda up $1.35 to $30.30, Falconbridge up $1.25 to $30.25, and Rio Algom up $1.60 to $29.25.

Inmet Mining was the most active, with 10.4 million shares changing hands, but it didn’t share in the gains made by the other metal miners, falling 45 cents to close at $7.55. The company, which has begun a major restructuring, has written off a number of its assets, and the market appears to be backing away from the stock.

The junior exploration companies generally did well this week. Bre-X Minerals added $2.65 to close at $23.15 on speculation that it has solved its land title problems in Indonesia.

Also higher was Breakwater Resources, which added 15 cents to close at $2.15.

There was no news from the company, whose principal interests are in two lead-zinc mines: Nanisivik on Baffin Island, N.W.T., and Caribou in New Brunswick.