Golds lose steam during holiday week

The report period June 29-July 6 saw reduced activity caused by Canada Day and, south of the border, Independence Day. Gold closed down $9.75 to finish at US$394.50 per oz. in the afternoon of July 6 in London. The gold index was down by 0.04 point, closing at 198.59, while the diversified metals and mining index fell 2.76 points to close at 222.49 points. The S&P TSX composite index was up 15.87 points, finishing at 8,484.74 points.

Iamgold held a vote on its proposed merger with Wheaton River, with shareholders rejecting the merger. Following the announcement, Wheaton River cancelled a similar vote its shareholders were to hold. Trading in both stocks was halted at presstime, pending the release of news. The rejection opens the door for Coeur d’Alene Mines to acquire Wheaton and for Golden Star Resources to acquire Iamgold (though others may also join the fray).

Wheaton River led the way in volume, trading 11.26 million shares over the period. Shares were down 5.5%, or 22, to close at $3.75. Shares in Iamgold were down 1.3%, or 10, to close at $7.55 on a volume of 4.62 million shares.

Defiance Mining was up 26%, or 10, to close at 48.5, on a volume of 6.05 million shares. Rio Narcea Gold Mines said it plans to acquire Defiance Mining by paying one of its shares for each 5.25 shares of Defiance. At the time of the offer, Rio Narcea placed a 37% premium on each Defiance share. Rio Narcea shares dropped 8.1%, or 24, to close at $2.70.

Queenstake Resources traded third in volume among mining stocks and closed up 6, or 11.5%, to finish at 58. There was no news to account for the high volume.

Brazilian Diamonds was the top percentage gainer. It was up 14, or 29%, to close at 62 on a volume of 314,000 shares. Again, there was no news to account for the rise.

X-Cal Resources shot up 20%, or 11, to close at 65 on a volume of 480,500 shares. The company released drill results from the Sleeper gold joint venture in Humboldt Cty., Nev., where New Sleeper Gold is an equal partner. Highlights include one hole that intersected up to 18.7 grams gold and 1,007.8 grams silver per tonne over 6.9 metres, plus a separate intercept of 29.3 grams gold and 31 grams silver over 8.1 metres. New Sleeper trades on the Vancouver exchange and closed up 8, or 9.5%.

Noranda was down 3%, or 74, to close at $23.10. Brascan announced it is reviewing options to sell its 42% stake in Noranda (valued at around $3 billion). Several companies, including CVRD, have expressed an interest in the company.

Aur Resources closed down 8%, or 55, at $6.04. Aur and Inmet Mining cancelled their plans to merge. For its part, Inmet stock was up 4.7%, or 84, to close at $18.59.

UEX closed up 17.8%, or 15, at 99 on a volume of 857,000 shares. It reported that the radioactive springs area in the Riou Lake project in northern Saskatchewan will be drilled this winter. UEX also agreed to budget $5.2 million for exploration on some of Cogema Resources’ northern Saskatchewan properties.