TSX suffers resource slump

The Toronto Stock Exchange lost another 58.71 points to end the Oct. 11-17 report period at 10,553.44. The gold index plunged 8.12 points, or 3.7% to 212.2 points as the yellow metal edged US$1.80 per oz. higher to US$474.50 per oz. The base metals were split; nickel stood out with a US$525-per-tonne, or 4%, drop to a near-52-week low of US$12,385 per tonne.

Inco started the report period off with a bang, launching a $12.5-billion cash-and-share bid for cross-town rival Falconbridge on Oct. 11. Falco returned some of its early gains to end $3.28 better at $34.10 on about 25 million shares. Inco did the same, but ended 35 into the red at $51.55 on about 15 million shares.

Guinor Gold outpaced the newlyweds with more than 31.5 million shares traded after Crew Gold said it planned to buy the West African gold miner for US$328 million in cash. Guinor ended unchanged at $1.40; Crew slipped 16 to $1.72 on around 267,000 shares.

In other mergers-and-acquisitions action, Canico Resource urged shareholders to reject an unsolicited takeover offer from diversified Brazilian miner Companhia Vale do Rio Doce. Canico says the offer is “inadequate from a financial point of view.” Canico forfeited 85 to settle at $18.75, still higher than CVRD’s offer of $17.50 per share.

Crystallex International‘s rebound was short-lived. The shares surrendered earlier gains to finish 6 poorer at $1.80. The company’s Chief Operating Officer Ken Thomas announced his retirement, effective Nov. 8. Barney Burke, who previously managed the day-to-day operation of the embattled Las Cristinas project in Venezuela, will oversee project construction once the long-awaited environmental permit is granted.

Fellow Venezuelan hopeful Bolivar Gold retreated another 23 to $2 even, while Gold Reserve surrendered most of the previous period’s recovery to end 16 lower at $2.55. Shares in companies active in Venezuela have been on the slide since the government said it would cancel “inactive” mining concessions and stop issuing new gold and diamond mining concessions.

Also on the slide was Kinross Gold, which planned to meet with its board of directors to approve preliminary financial statements for 2004 and a restated financial report for 2003. The 2003 report is expected to include a significant writedown of goodwill associated with Kinross’ merger with TVX Gold and Echo Bay Mines in 2003. Kinross fell 36 to $8.57.

Canada’s remaining major gold producers followed suit: Placer Dome lost 33 to $19.84 and Barrick Gold shed $1.62 to make $32.04. Barrick recently said it would buy back blocks of shares from holders of 99 or fewer shares without a brokerage commission until Dec. 5.

Gitennes Exploration suffered the biggest percentage drop, ending off 36, or 41% lower at 51. The latest drill results from the Tucumachay gold-silver project in Peru failed to live up to those obtained by previous panel sampling. Gitennes is earning a 100% interest in the property from Inmet Mining, which will retain a royalty. For its part, Inmet declined 65 to $20.