U.S. equities gain on late-week surge June 25-29

VANCOUVER — U.S. equities jumped late in the week following news that European leaders had agreed to distribute rescue funding directly to troubled national banks, which marked a key victory for Spain and Italy where borrowing costs where hitting dangerous levels despite efforts to curtail government spending. News from the EU Summit overshadowed tepid U.S. economic data earlier in the week, as consumer confidence dipped to five-month lows and durable goods orders missed analyst estimates — pointing to a potential manufacturing slowdown.

The Dow Jones Industrial Average rose 1.9% or 239.3 points en route to a 12,863.90 weekly close, while the S&P 500 enjoyed a 2.03% gain, rising 27.14 points before closing out the week at 1,360.60. The Philadelphia Gold and Silver index gained 1.25 points or 0.8% to close at 157.54.

It was a big week for fertilizer producers on the value-added side after Potash Corp. of Saskatchewan CEO Bill Doyle predicted there would be no new potash mines hitting production for at least five years. Doyle’s comments followed a report by Europe’s Rabobank, which speculated a substantial overcapacity in the potash market by the end of the decade, ranging between 59% and 100% of demand. Doyle claimed the report underestimated the difficulties involved in starting up new potash operations, and said he was unaware of any Greenfield deposits that would hit production by 2017. 

U.S.-based fertilizer heavy weight Compass Minerals International led the way with a $6.58 increase en route to a $76.28 weekly close, while competitor Agrium Inc. jumped $4.23 before closing out the week at $88.47. Minnesota-based fertilizer giant Mosaic Co. leapt $4.18 to close at $54.76 and Potash Corp. enjoyed a $3.35 boost before closing at $43.69.

Vancouver-based Quattera Resources’ shares jumped 12.2% during a busy week that saw the company file a preliminary economic assessment on its MacArthur copper project in Nevada, as well as announce a resource increase at its Nieves silver property in Mexico.

Missouri-based Arch Coal, the largest coal producer in the Powder River basin, continued to rebound following news it was downsizing operations to control costs. Arch leapt 12.4% before closing at $6.86 to end the week. Producers in the coal space are also benefitting from renewed optimism vis-à-vis the EU crisis and potential economic stimulus packages in China and the U.S.

It was not a kind week for silver producers as prices for the precious metal fell to nearly $26 per oz. by midweek before rebounding to close at roughly $27.50. Silver Standard Resources dropped 39¢ to an $11.24 close, while Pan American Silver also lost 39¢ before closing at $16.88. Fortuna Silver dropped 28¢ en route to a $3.45 weekly close.