Market News

TORONTO STOCK EXCHANGE

The Toronto Stock Exchange gathered downward momentum during the trading period as growing uncertainty in the eurozone and lagging commodity prices drove the index to seven-month lows.

The S&P/TSX Composite Index hit its lowest point since October, dropping 414.03 points during the week for an 11,280.64 close. The S&P/TSX 60 Index ended the period at 640.57 points down 15.56 for a loss of 2.4%.

Spot gold experienced a large swing as prices in New York fell to eight-month lows of US$1,527 per oz. on May 16, before rebounding to US$1,592 per oz. to end the week. As a result the S&P/TSX Global Gold Index remained flat, closing at 286.13.

Gold producers dominated volume trading, as investors scrambled to deal with the weekly swing in spot prices. Kinross Gold saw the highest volumes with 29.6 million shares changing hands en route to an 8¢ loss. Eldorado Gold also experienced high volumes with 17.1 million shares traded, resulting in a 37¢ net loss during the week. Canadian producer Barrick Gold was next in-line with 16.3 million shares exchanged en route to a 78¢ gain in share price.

On the base metals side, Mercator Minerals’ (ML-T) shares plunged 24%, or 19¢ during the week, on 17.1-million-share trade volumes following the release of the company’s first-quarter results. Mercator reported first-quarter earnings of US$1.5 million, resulting in a net-zero earning per share. The company’s operating cash flows clocked in at US$7.1 million, leading analysts to question its ability to fund growth prospects.

Mercator had previously downgraded its full-year production forecast at its flagship Mineral Park mine owing to lower-ore grades and difficulties with mill processing. The mine is expected to produce 89 million equivalent lbs. copper, a decrease from an earlier guidance range falling between 90 million and 100 million equivalent lbs. copper.

McEwen Mining saw its shares plummet 24.5% to $2.21 following news that the Argentinean government was seeking a repatriation of funds from its 49%-owned San Jose gold mine in the country’s Santa Cruz province. The repatriation could affect McEwen’s ability to internally finance development at its El Gallo gold-silver project in northwestern Mexico’s Sinaloa
State.

The bottom fell out for Baja Mining as the company announced it might not find capital to further develop its copper-cobalt-
zinc Boleo project near Santa Rosalia, Mexico. Baja shares tumbled down 30% to a 24¢ close on 7.2-million weekly volumes,
and the company’s CEO John Greenslade resigned.

TSX most active issues

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
Kinross Gold	K	29555	8.13	7.31	7.83	-0.08
Osisko Mng	OSK	25561	7.54	6.25	7.00	-0.40
Mercator Mnls	ML	19659	0.78	0.58	0.61	-0.19
Eldorado Gold	ELD	17069	11.54	10.27	11.12	-0.37
Barrick Gold	ABX	16512	39.40	35.11	37.87	+0.78
Yamana Gold	YRI	16260	14.25	12.76	13.94	+0.37
B2Gold	BTO	15194	3.37	2.64	3.17	-0.02
Cline Mng	CMK	14924	0.81	0.56	0.71	-0.11
Goldcorp	G	14572	36.95	32.52	35.46	+0.61
Aura Mnls	ORA	13147	0.71	0.29	0.30	-0.40

TSX greatest percentage change

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
TVi Pacific	TVI	184	0.04	0.03	0.03	+20.0
Calvista Gold	CVZ	199	0.25	0.19	0.03	+18.4
Pac Rim Mining	PMU	472	0.11	0.06	0.10	+17.6
Shore Gold	SGF	553	0.29	0.23	0.28	+16.6
Stockport Expl	SPT	54	0.11	0.10	0.11	+15.7
Cerro Grande M	CEG	221	0.40	0.22	0.40	+14.2
Alexis Minls	AMC	1243	0.04	0.04	0.04	+14.2
Evolving Gold	EVG	1389	0.25	0.19	0.25	+13.6
Royal Nickel	RNX	390	0.45	0.39	0.43	+13.1
Nuinsco Res	NWI	918	0.06	0.05	0.05	+11.1
Aura Mnls	ORA	13147	0.71	0.29	0.30	-57.1
White Tigr Gold	WTF	9303	0.15	0.07	0.10	-48.7
Red Cresc Res	RCB	437	0.08	0.05	0.05	-33.3
CaNickel Mng	CML	1672	0.03	0.02	0.02	-33.3
Marian Res	MRY	303	0.10	0.06	0.10	-31.0
Baja Mng	BAJ	7195	0.40	0.24	0.24	-30.4
Golden Mnls	AUM	462	5.12	3.40	3.70	-28.9
Aquila Res	AQA	968	0.31	0.21	0.22	-27.1
McEwen Mng	MUX	2736	2.96	2.21	2.26	-24.9
Verde Potash	NPK	297	5.11	3.85	4.00	-24.5

TSX greatest value change

TCKB

VOLUME			WEEK
			CLOSE	CHANGE
Central Gold-T	GTU_U	14045	60.30	+1.30
Barrick Gold	ABX	16511502	37.87	+0.78
Royal Gold	RGL	138676	63.93	+0.64
Goldcorp	G	14571752	35.46	+0.42
Alamos Gold	AGI	1943129	17.90	+0.39
ISh COMEX G Tr	IGT	63018	15.82	+0.37
Yamana Gold	YRI	16260449	8.36	+0.34
New Gold	NGD	7495598	20.10	+0.25
Central Fund	CEFA	560840	5.61	+0.25
NovaGold Res	NG	2562718	5.61	+0.25
Walter Energy	WLT	28358	50.05	-11.95
Agrium	AGU	4932133	78.01	-5.55
Teck Res B	10216300	29.45	-3.54
Teck Res A	TCKA	12963	31.55	-2.95
Inmet Mining	IMN	1767985	44.28	-2.88
Cameco Corp	CCO	4107626	19.34	-2.25
Tahoe Res	THO	2547796	16.57	-1.79
Labdr I-Ore Ro	LIF_U	522340	32.82	-1.73
Major Drilling	MDI	2781628	11.32	-1.71
Mag Silver	MAG	1053552	7.09	-1.61

TSX VENTURE EXCHANGE MAY 14-18

The tough markets took on a whole new level of decline in the period and the S&P/ TSX Venture Composite Index dropped no less than 118.45 points, or 8.8%, to end at 1227.88 points, its lowest level since October 2009. Volume was up to an average of 90 million shares traded daily, but the high volume was caused more by damaging news, rather than any optimism.

Leading the volume boost was Canaco Resources with 41 million shares traded after announcing its much-anticipated Handeni resource estimate. With 721,000 indicated oz. gold at 1.48 grams gold per tonne plus 292,000 inferred oz. at 1.36 grams gold, the resource fell short of expectations. The company’s stock price plunged 58¢ to 30¢ on the news, having already fallen from a high of $6.45 in early 2011. Analysts had been looking in the 3-million-oz. range for the Tanzania-based project.

With half the volume but even worse share-price losses, Hana Mining fared no better than Canaco. The company released a scoping study on its Ghanzi copper project in Botswana that shows higher operating costs and a lower net present value (NPV) than expected, despite factoring in fairly bullish copper and silver prices. Using US$3.40 per lb. copper and US$30 per oz. silver, the project shows an NPV of US$262 million and an internal rate of return of 19.3%. Projected cash costs came in at US$1.82 per lb. copper, net of by-products. Hana’s share price dropped 89¢, or 69% to 41¢ on the news, with 20 million shares traded.

Neither company, however, lost the most value per share. That distinction went to Lumina Copper after its share price ended down $2.62 at $9.88, having dropped as much as $4.31 to $8.15 at one point. The company had no news, issuing a release to emphasize there were no updates and the drop was likely owing to market conditions. In mid- April the company’s share price was hit after Argentina — where Lumina’s huge Taca Taca copper project is located — nationalized the oil company YPF. After an initial scare investors look to have concluded the move was isolated, but nervousness about the country has by no means gone away.

As far as companies ending up in the period, Chesapeake Gold climbed 99¢ over four days and ended up 33¢ at $9.02, as the highest value gainer. The gains, however, came after 10 days of straight losses that saw the company lose $4.97 of its share price.

Like Lumina the company did not release any news. Chesapeake announced in early March that the prefeasibility study on its
Metates gold-silver project in Mexico would be delayed, but should be out early in the second quarter. The company has still
not released the study.

TSX-V most active issues

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
Canaco Res	CAN	40985	0.89	0.29	0.31	-0.57
Hana Mng	HMG	20096	1.30	0.35	0.41	-0.89
Trelawney M&Ex	TRR	17272	3.28	3.26	3.27	-0.01
Aurcana Corp	AUN	8629	0.90	0.75	0.83	-0.07
American Mang	AMY	6278	0.29	0.13	0.14	-0.14
Roxgold	ROG	4244	0.86	0.65	0.75	-0.12
Waymar Res	YUM	3836	0.32	0.24	0.30	-0.06
Lakewood Mng	LKW	3587	0.04	0.04	0.04	0.00
Seafield Res	SFF	3444	0.12	0.10	0.11	-0.01
Benton Res	BTC	3444	0.33	0.28	0.29	-0.05

TSX-V greatest percentage change

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
Stratabd Mnr	SB	220	0.10	0.06	0.10	+81.8
Metalcorp	MTC	222	0.05	0.03	0.05	+80.0
Alexander Mng	AXD	20	0.07	0.07	0.07	+75.0
Whetstone Mnls	WMI	13	0.14	0.10	0.14	+75.0
Taipan Res	TPN	168	0.54	0.29	0.40	+60.0
New Guinea Gld	NGG	76	0.02	0.01	0.02	+50.0
Noble Metal Gr	NMG	582	0.02	0.01	0.02	+50.0
Dentonia Res	DTA	209	0.02	0.01	0.02	+50.0
Bandera Gold	BGL	50	0.05	0.04	0.05	+50.0
Solid Gold Res	SLD	20	0.07	0.07	0.07	+44.4
SG Spirit Gold	SG	318	0.14	0.07	0.07	-72.0
Hana Mng	HMG	20096	1.30	0.35	0.41	-68.6
United Reef	URP	661	0.01	0.01	0.01	-66.6
Canaco Res	CAN	40985	0.89	0.29	0.31	-64.7
Advanced Prima	APD	52	0.07	0.03	0.03	-53.8
American Manga	AMY	6278	0.29	0.13	0.14	-50.0
North Am Gem	NAG	1810	0.01	0.01	0.01	-50.0
Nanika Res	NKA	67	0.01	0.01	0.01	-50.0
Tigray Res	TIG	837	0.45	0.22	0.26	-42.2
Intl Millm Mng	IMI	192	0.11	0.08	0.08	-40.7

TSX-V greatest value change

VOLUME			WEEK
			CLOSE	CHANGE
Chesapeake Gld	CKG	186812	9.02	+0.33
Taipan Res	TPN	168195	0.40	+0.15
Atac Res	ATC	2039566	2.38	+0.14
Tsodilo Res	TSD	45317	1.01	+0.12
Sona Res	SYS	144055	0.59	+0.11
Maudore Minls	MAO	104400	3.53	+0.11
McVicar Res	MCV	169000	0.49	+0.08
Astur Gold	AST	31437	0.93	+0.08
Reunion Gold	RGD	529397	0.55	+0.08
Huakan Intl Mg	HK	2000	0.40	+0.08
Lumina Copper	LCC	1023864	9.88	-2.62
Hana Mng	HMG	20096255	0.41	-0.89
Northern Graph	NGC	1751736	1.63	-0.64
Sandstorm Gld	SSL	1801069	7.85	-0.60
Canaco Res	CAN	40984873	0.31	-0.57
Anfield Nickel	ANF	143500	3.21	-0.49
Pac Booker Min	BKM	33560	13.01	-0.49
Gold Reserve	GRZ	39117	3.76	-0.44
Clifton Star	CFO	279188	0.92	-0.39
Newstrike Cap	NES	781320	1.77	-0.37

U.S MARKETS

Wall Street suffered its worst week this year with the Dow Jones Industrial Average shedding 451.22 points, or 3.52%, to finish at 12,369.38, and the S&P 500 Index shrinking 58.17 points, or 4.30%, to close at 1,295.22. The Nasdaq Composite Index dropped 155.03 points, or 5.28% to 2,778.79, while the Philadelphia Gold and Silver Index lost 3.49 points, or 2.36%, to close at 151.25.

Despite encouraging signs on the domestic economic front — improving home-builder sentiment, coupled with rising housing starts and industrial production in the month of April — the Greek imbroglio, and the realization that the country will likely exit the eurozone after new elections in June, kept investors on the sidelines. Concern about China’s slowing economic growth, the lessthan- impressive debut of Facebook shares and mounting loss estimates at JP Morgan also contributed to the decaying sentiment.

The biggest value gain of the week — US80¢ a share — went to AngloGold Ashanti after the reticent billionaire hedgefund manager John Paulson said he liked the stock at the annual Ira Sohn conference in New York on May 16. A day earlier, the gold producer disclosed that its CEO Mark Cutifani and chief financial officer Srinivasan Venkatakrishnan exercised 86,293 and 70,375 share options respectively and applied all of the after-tax proceeds, net of costs, to acquire 51,692 and 42,157 ordinary shares respectively in their own names. AngloGold shares ended at US$34.28 apiece.

With the New York spot price of gold up by US$12 per oz. to end the week at US$1,592.10 per oz., shares of New Gold, Newmont Mining, Yamana Gold, Banro and Barrick Gold rose slightly on no news.

America West Resources posted the largest percentage jump of the week, rising 35.8% to close at 11¢ per share on no news. Its subsidiary Hidden Splendor Resources operates the Horizon coal mine in Carbon County, Utah. The coal mine, which produces steam coal used by power plants, averaged 280,000 tons of coal a year over the last four years as a one-section mine. But management believes that as a multiple-section mine, Horizon could generate between 600,000 and 2 million tons per year.

U.S. most active issues

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
Alcoa*	AA	138257	9.12	8.38	8.43	-0.63
Freeport McMo*	FCX	100358	35.12	31.52	31.81	-2.93
Alpha Nat Res*	ANR	87927	13.67	10.81	10.89	-2.27
Arch Coal*	ACI	63771	8.44	7.12	7.20	-0.86
Kinross Gold*	KGC	56976	8.00	7.22	7.68	-0.22
Barrick Gold*	ABX	56207	38.75	34.82	37.12	+0.08
Peabody Enrgy*	BTU	50126	28.90	23.65	23.77	-4.71
Silver Wheatn*	SLW	46904	25.82	22.94	24.63	-1.83
Goldcorp*Elray Res*	GG	38519	36.37	32.16	34.79	-0.06
Newmont Mng*	NEM	37099	47.00	43.23	45.58	+0.22

U.S. greatest percentage change

VOLUME			WEEK
			HIGH	LOW	CLOSE	CHANGE
America West*	AWSR	79	0.11	0.09	0.11	+35.8
Cornerstone C*	CTNXF	80	0.11	0.09	0.09	+4.9
Tombstone Exp*	TMBXF	11	0.02	0.02	0.02	+4.3
Gold Am Mng*	SILA	68	0.04	0.03	0.03	+3.3
New Gold*	NGD	24714	8.30	7.13	8.23	+2.8
Banro Res*	BAA	1232	4.04	3.37	3.90	+2.6
Timberline Rs*	TLR	1084	0.40	0.27	0.39	+2.6
AngloGold Ash*	AU	15641	34.65	30.70	34.28	+2.3
Midway Gold*	MDW	518	1.35	1.16	1.21	+1.6
NovaGold Res*	NG	20430	5.79	5.06	5.46	+0.9
Infrastrc Mat*	IFAM	13	0.03	0.03	0.03	-51.6
Patriot Coal*	PCX	6989	5.04	3.26	3.29	-34.0
Li3 Energy*	LIEG	999	0.09	0.06	0.06	-29.4
Tri-Valley*	TIV	1131	0.09	0.06	0.06	-28.5
McEwen Mng*	MUX	21313	2.95	2.18	2.22	-26.4
Uranerz Energ*	URZ	5793	1.46	1.10	1.10	-24.1
China Shen Zh*	SHZ	185	0.91	0.60	0.69	-24.1
Mechel*	MTL	3866	7.09	5.42	5.48	-24.1
Augusta Res*	AZC	226	2.10	1.54	1.66	-22.7
Golden Star*	GSS	18175	1.46	1.13	1.13	-21.5

U.S. greatest value change

VOLUME			WEEK
			CLOSE	CHANGE
AngloGold Ash*	AU	15641096	34.28	+0.80
New Gold*	NGD	24713768	8.23	+0.23
Newmont Mng*	NEM	37099314	45.58	+0.22
Yamana Gold*	AUY	7932565	13.68	+0.11
Banro Res*	BAA	1231637	3.90	+0.10
Barrick Gold*	ABX	56206947	37.12	+0.08
NovaGold Res*	NG	20429992	5.46	+0.05
America West*	AWSR	78850	0.11	+0.03
Keegan Res*	KGN	331620	2.94	+0.02
Midway Gold*	MDW	517981	1.21	+0.02
Walter Energy*	WLT	3735757	49.24	-12.26
Agrium*	AGU	1516516	76.48	-6.93
Cliffs Nat Rs*	CLF	18957183	48.69	-6.74
BHP Billi-BHP*	BHP	18954359	62.49	-6.33
Rio Tinto*	RIO	4744701	43.73	-6.32
BHP Billi-BBL*	BBL	6122202	53.59	-5.48
Molycorp*	MCP	16566168	19.64	-5.29
Cabot Corp*	CBT	2069799	36.92	-4.95
Consol Energy*	CNX	33627392	29.36	-4.90
Peabody Enrgy*	BTU	50125942	23.77	-4.71