US markets post first weekly gains in 2016, Jan. 18-22

U.S. markets were closed on Jan. 18 for the Martin Luther King Jr. holiday and see-sawed the rest of the week, as West Texas Intermediate crude dipped below US$27.98 per barrel on Wednesday before finishing up 5.5% to US$32.20. The European Central Bank said interest rates would stay on hold until a policy review in March, while U.S. data showed housing resales in December rose 14.7% after falling 10.5% in November. The benchmark S&P 500 Index and the Dow Jones Industrial Average posted their first gains of 2016, with the S&P 500 up 1.4% to 1,906.90 and the Dow Jones Industrial Average inching 0.7% higher to 16,093.51. Spot gold advanced US$9.20 per oz. to US$1098.00, while the Philadelphia Gold & Silver Index fell 1.2% to 40.92.

Courts in Brazil suspended Vale’s port of Tubarao due to pollution concerns on Jan. 21. Vale said the closure would block 200,000 tonnes of iron ore loaded daily. Last year, the company shipped 105 million tonnes of iron ore from the port, which made up 35% of its total output, according to HSBC. Vale’s shares were down US10¢ to US$2.27.

Shares of Teck Resources jumped 20% to US$3.72 on the back of a royalty deal with Sandstorm Gold worth US$22 million. Sandstorm is paying US$1.2 million in cash and US$20.6 million in shares for a 56-royalty package from Teck and its affiliates that include four producing assets, nine development projects, eight advanced projects and 35 exploration properties. 

Barrick Gold gained US68¢ to US$8.58 per share. The company announced preliminary 2015 full-year production of 6.12 million oz. gold, in line with its updated guidance of 6 to 6.15 million oz. Barrick’s preliminary full-year copper production of 511 million lb. also met guidance of 480 to 520 million lb. The company is carrying out its annual accounting impairment review, and a preliminary analysis shows potential goodwill impairment charges of US$1.8 billion, and asset impairment charges from US$1 billion to $1.2 billion, mostly related to Pascua-Lama and Pueblo Viejo. The company is assuming US$1,000 per oz. gold for 2016 and US$1,200 per oz. in the long term.