MINING MARKETS & INVESTMENT NEWS – EASTERN MARKETS — Base metal producers show strong performance

The Toronto Stock Exchange 300 index plummeted 239.81 points during the report period Feb. 3-9, ending the week at 6,443.97.

Overshadowing the broad market’s depressing performance was an unexpected surge in the price of nickel, which soared 19 cents to trade at US$2.13 per lb. on the morning of Feb. 10. As well, copper and zinc each climbed 2 cents, while lead gained a penny.

The stronger metal prices bolstered the TSE’s metals and minerals sub-group, which gained 75.25 points to close the period at 3,019.49.

Inco led the producers, climbing $1.30 to $17, but was closely followed by Cominco and Noranda, both of which gained 80 cents to end at $18.80 and $16.80, respectively.

Producers of the yellow metal fared much worse than their counterparts, with the gold and precious metals sub-index plunging 242.65 points to 3,019.49. Gold bullion tumbled 45 cents to US$287.10 per oz., while silver shed a penny to trade at US$5.53 per oz. Platinum and palladium, on the other hand, both gained in value, which reflects Russia’s failure to export any platinum group elements so far this year.

Barrick Gold fell $1.55 to $28.55 on news that its president, Paul Melnuk, had resigned and that the company had failed to take over Vancouver-listed Argentina Gold. Both announcements came on Feb. 8 and were quickly followed the next day by the release of glowing 1998 operations results.

Also down at the end of the period were: Placer Dome, off 90 cents at $16.90; TVX Gold, off 28 cents at $2.03; and Franco-Nevada Mining, off $2.30 at $26.90. Bucking the trend was Kinross Gold, which rose 25 cents to $3.60. The major recently announced operational improvements at its various mines.

Nuinsco Resources added 40 cents to close at $2.61, marking the fourth consecutive period in which the junior has risen in value since announcing the discovery of copper-nickel mineralization in the Lac Evans area of northwestern Quebec. That announcement was soon followed by a staking rush, but hardly any gain in share value for the participants involved.

Lytton Minerals climbed 13 cents to 25 cents on news that shareholders had approved its merger with Alberta-listed New Indigo Resources. The merged entity, christened Tahera Corporation, will replace Lytton on the TSE and trade under the symbol tah, starting March 1.

Yamana Resources fell 10 cents to 50 cents, despite attaching a resource to its Lejano prospect in southern Argentina. This is the second Argentine property on which the junior has outlined a multi-million-ounce silver resource (the other being North Bacon).