STOCK MARKETS — Money markets improve, but gold and metals

Money markets continued to improve during the week, but declines in the metals and minerals and gold subgroups lead to a drop in the composite index.

On April 12, the central bank rate tumbled 37 basis points to 5.84%, after a rally lifted treasury bill prices, and the Canadian dollar gained 44 cents to close at US72.54 cents. The Toronto Stock Exchange 300 index slipped 7.59 points to 4,295.41, in thin trading.

Heavy U.S. fund selling on April 11 sent gold plunging US$6.30 in New York to US$377.95 an ounce, the lowest close since early March. The London afternoon gold fix (April 13) was pegged at US$378.50.

Declining bullion prices continued to drag down many of the senior gold producers: Placer Dome lost $1.13 to close at $31.13 on a volume of over 4.53 million shares; Hemlo Gold Mines fell 63 cents to $12.88; Goldcorp lost 38 cents to $8.50; while American Barrick Resources was the big loser closing down $1.88 to $31.63

Gold royalty companies also took a big hit on the week, with Franco-Nevada Mining losing $2.13 to $79 and Euro-Nevada Mining off $2.25 to $39.75. Bucking the trend was gold miner Lac Minerals which added 38 cents to $11.88. Rumor has it that Lac is amassing a land position in northern Alberta, near where several juniors have reported gold and platinum values in Devonian-aged carbonate rocks (see page 1 story on the GSC studies in Alberta). When contacted by The Northern Miner, Patrice Merrin Best, Lac’s vice-president of Corporate and Investor Relations, confirmed that the company was acquiring ground in the region for the purpose of general exploration. Several juniors working in the same area of Alberta have also experienced price increases and high trading volumes. NSR Resources rocketed up 53 cents to close at $1.43 while Tintina Mines rose $1.40 to close at $3.65. Tintina traded 700,000 shares, and over 3.5 million NSR shares changed hands. After announcing that it had acquired an interest in over 1 million acres in the region, Alberta-listed Focal Resources jumped 57 cents to close at $1.75 on a volume of more than 1.2 million shares.

Elsewhere on the junior gold scene, Sudbury Contact has just completed its latest round of drilling at the Victoria Creek project northwest of Larder Lake, Ont. Although assay results have not been released, investors drove the stock up $2.13 on the week to close at $8.63.

Continued drilling at the 1060 zone helped Kinross Gold achieve a new 52-week high. Almost 4.4 million shares changed hands as the company’s shares climbed to $6.75 before slipping back to $6.38. Overall the shares were up 50 cents on the week.

Another big volume trader was Great Lakes Minerals. The company’s stock continues to trade in large blocks. The shares gained a nickel to close at $2.00 on a volume of almost 4.5 million shares.

Cuban explorer Joutel Resources tacked on 9 cents to 77 cents on a volume of 921,900 shares. A recent tour of the company’s properties apparently left investors with a favorable impression of the Cuban scene, especially after the group met with Fidel Castro.

Joutel’s sister company Queenston Resources also fared well on the week, adding 27 cents to close at $1.13 on a volume in excess of 1.3 million shares. Five of the company’s gold properties will be drill-tested later this year.

Caledonia Mining hit a new 52-week high of $9.25, before closing down $1.13 to $6.75 on a volume of over 1.3 million shares. The company’s 46%-owned subsidiary Reunion Mining recently reported that it had found three new kimberlites in the Katete region of Zimbabwe.

Other diamond explorers fared well on the week with Ashton Mining of Canada tacking on 40 cents to close at $2.80, and Pure Gold Resources gaining 6 cents to close at 67 cents on a volume of 9,866,000 shares. In recent weeks, both companies have been optioning diamond properties in various locations throughout Canada.

African explorer Trillion Resources hit a new 52-week high of $5 before edging downward to close at $4.85. The gain of 50 cents follows reports that the company has acquired 13 prospecting licenses and issued over 2 million warrants for gross proceeds of almost $7.2 million.