Gold explorers jump back to life

Buyers managed to overtake sellers over the Dec. 12-18 report period to push the Toronto Stock Exchange 300 index up 54.84 points to 7,586.47.

Gold surged ahead $5.65 in London markets to land at a morning fix of US$278.90 per oz. on Dec. 19. Bolstered by renewed confidence in the yellow metal, the TSE’s gold and precious metals sub-group catapulted 429.79 points to 5,189.39.

Barrick Gold was the most actively traded mining issue, rising $2.32 on a volume of 22.8 million shares. Barrick formally merged with Homestake Mining to become the world’s largest gold miner by market capitalization and second largest by production, after South African-based AngloGold.

Franco-Nevada Mining, embroiled in its own takeover battle, rose $1.58 to $23.55. Franco intends to merge with New York-listed Newmont Mining so long as that company succeeds over rival suitor AngloGold to acquire Normandy Mining. The latest development in the contest saw AngloGold extend its bid’s closing date by a week. Normandy climbed 72 over the period to finish at $14.62.

Also making gains over the period were: Placer Dome, up $1.69 to $18.20; Kinross Gold, up 19 to $1.18; Goldcorp, up $2 at $19.25; Meridian Gold, up $1.60 at $16.90; and Agnico-Eagle Mines, up $1.64 at $16.35. Goldcorp announced the discovery of more bonanza grades at its Red Lake mine in northwestern Ontario.

TVX Gold recouped nearly all it lost in the previous period, rising 4 to 64. The Greek government has lifted a mining suspension on the company’s Stratoni zinc-lead-silver mine.

The sub-group’s only palladium producer, North American Palladium, clawed back 75 over the five trading days to end at $8.65. The turnaround reflects higher spot prices.

Nickel was the biggest gainer among the base metals, climbing 28 to US$2.52 per lb. on Dec. 19. The higher prices translated into a 2.9% increase in the value of the TSE’s metals and minerals sub-group.

Leading the producers were Alcan, up $1.61 to $59.25, and Inco, up 93 to $26.58. Other gainers were Teck Cominco B-series, up 83 to $12.50, Falconbridge, up 65 to $16.11, and Noranda, up 38 to $14.45.

The mid-tier producers generally were not so lucky, with First Quantum Minerals sinking 25 to $2.85, Sherritt International falling back 9 to $3.93, and Ivanhoe Mines slipping 2 to $1.81. Inmet Mining, which is increasing its stake in the Cayeli copper-zinc mine in Turkey, bucked the trend with a 20-rise, to $2.95.

Among juniors, Tahera was the most actively traded, with a volume of 6.3 million shares. The junior announced the discovery of seven diamonds in a kimberlite float sample taken west of the Jericho pipe in Nunavut. Six of the stones measured more than 0.5 mm in one dimension. Tahera closed up a penny at 15.