MINING MARKETS & INVESTMENT NEWS — EASTERN MARKETS — Precious, base metal miners stage broad rally

The April 28-May 4 report period saw a broad rally in metal prices and mining stocks in the eastern markets.

Leading the charge were gold prices, which shot up $4 to US$285.50 per oz. on the London morning fix of May 5.

The lift helped boost several of Canada’s major gold producers: Barrick Gold was up $1.45 to $30.55; Placer Dome rose 85 cents to $20.70; Kinross Gold eased up 3 cents to $3.08; Franco-Nevada Mining rose $2.50 to $28; and Euro-Nevada Mining climbed $1.60 to $24.60.

With nickel prices continuing to rebound, rising 3 cents last week week to US$2.45 per lb., Canada’s major producers all showed hefty gains: Inco climbed $1.75 to $27.10 on news of a bought deal for 15 million shares priced at $27.50 apiece; Falconbridge shot up $1.65 to $20.90; and Sherritt International rose 34 cents to $3.20.

Canada’s other base metal majors also had good weeks: Rio Algom rose $1.05 to $19.50; Teck’s B shares jumped $2.15 to close at $14.30; Cominco advanced 70 cents to $23.90; and Boliden soared $1.16 to $3.21.

Among the juniors, investors have shown renewed interest in Indochina Goldfields, which rose 13 cents to $1.23. In January, the Robert Friedland-backed junior officially opened its S&K heap-leach copper mine in Myanmar, and the solvent extraction-electrowinning plant is reported to be fully operational.

After a year of steady declines, Philex Gold is finally showing signs of life, having risen 18 cents to end the week at 34 cents. The junior, which operates two gold mines in the Philippines, made a profit for the first quarter and boosted production by 60%, thanks to improved grades and recoveries from the Bulawan mine on Negros island.

William Resources shares saw heavy trading as the debt-plagued gold miner announced it would not be making its May 20 interest payments on outstanding debentures that total about $72 million. William is proposing to issue another 249 million shares through the conversion of all outstanding debentures, potentially giving these debenture holders a 70% stake in the company. William ended the period unchanged at 6 cents.

Junior Canarc Resource jumped 19 cents, to 40 cents, on 940,000 shares traded. The company holds a royalty in the Bellavista gold project in Costa Rica, for which owner Wheaton River Minerals just released a positive feasibility study. Wheaton, which dropped 2 cents, to 31 cents, plans to fund the project with debt.

The dog of the week was palladium, whose spot price tumbled $62.50 to US$284 per oz. on evidence of major new shipments from Russia, the world’s largest producer. Despite the decline, Canada’s only primary palladium producer, North American Palladium, still managed to gain 15 cents to end the period at $1.30.