Vancouver Stock Exchange Return to stability after plummet

The Vancouver market has finally stabilized after plummeting over 70 points early in the week. Heavily biased towards precious metals, it reacted negatively to weaker gold prices which resulted from a stronger U.S. dollar. Gold’s decline coincided with brokerage month end for local and national houses which compounded the situation even more.

But the dollar’s strength proved to be only temporary and gold has started to climb back. A recent report from the U.S. commerce department showed the United States’ foreign debt doubled in 1986 to $263.6 billion making it the world’s largest debtor nation. So the fundamentals for the dollar aren’t really that good, suggesting further weakness is inevitable. That’s good for gold and the Vancouver market which was stronger today and ahead 7.3 points to 1828.

Among the more active issues at press time was newly-listed Tri- Gold Industries which traded at $1.80. Technigen Platinum was reinstated today and was down $1.25 to $8.63. The stock was halted June 18 at the company’s request. The Attorney General of Saskatchewan has taken legal action against Technigen President Lawrence Nesis over his alleged failure to register Lico Resources under the province’s business corporation act. The allegations are being contested.

On the plus side, Seam Resources was 8c stronger at 50c on a volume of 550,000 shares. The company is planning a two-phased exploration program for its Battle Mountain gold property which should cost about $100,000. Silverado Mines traded lightly and was ahead 20c to $1.50. The company recently obtained $478,000 from a share issue and paid off $796,000 in trade debts with shares.

Over our report period the market trend was definitely downward with some of the higher priced stocks posting significant losses. Pioneer Metals, which is rumoured to be a potential takeover candidate, dropped $1.75 to $11.25. Suggested suitors include Granges Exploration and possibly MFC Mining Finance or Blackdome. There isn’t any large control block so a takeover is possible.

Breakwater Resources, which could be paying dividends later this year, tumbled $1.62 to $7.38. The situation at its Cannon mine property has improved considerably and the takeover of Novamin should increase Breakwater’s gold output in the next few years. Rea Gold, which has been a star performer lately based on results from its Adams Plateau property near Kamloops, B.C., lost 63c to $5. No doubt we’ll be hearing more from this property in the coming months. Golden North, which has a strategically-located property near Hedley, B.C. that should eventually be developed by Mascot Gold, shot up 87c to $8.50.

Quartz Mountain continued its mercurial rise (apparently it’s being heavily promoted by Galactic Chairman Robert Friedland) with the stock rising 70c to $3.80. Quartz Mountain recently reported high grade sample results (including 13 ft of 4.9 oz gold) from its Angels camp property in southern Oregon.

Zuni Energy was the volume leader with a turnover of 1.6 million shares for a 70c loss to $1.04. At last report, the company had signed an agreement to acquire an interest in a salvage project in the Marshall Islands.

New listings for the week included: W.M Helijet Airways (formerly Heaston Resources), Etana Technologies, Lord River Gold Mines, Consolidated Dakota, Thios Resources, and Grand Portage Resources.