Toronto Stock Exchange

The S&P/TSX Composite Index gained during the trading week to close at 12,268.01, up 319 points from where it began.
The lift followed two major announcements, including the European Central Bank’s plan to buy government bonds from eurozone countries struggling with their debts, and a poor U.S. jobs report that strengthened expectations that the Federal Reserve would provide more stimulus.

This helped boost the spot price of gold, which closed at US$1,735.50 per oz. — its highest level since February. The S&P/TSX Global Gold Index rose 14 points to 328.62, and the S&P/TSX Capped Diversified Metals & Mining Index added 94 points to 919.33.

Petaquilla Minerals was the week’s top percentage gainer and the most actively traded stock, soaring 70% after Inmet Mining announced it would buy the junior producer for $112 million in cash or shares. The acquisition would allow Inmet to consolidate the concession where it is developing the $6.2-billion Cobre Panama copper-gold project near Petaquilla’s gold mine in Panama. The takeover would likely reduce any environmental or social risks related to the Cobre Panama construction. Petaquilla added 26¢ to end the week at 62¢ on 27.7 million shares traded. Inmet closed at $49.16 on the bid and was up $5.15 a share, making it the week’s biggest value gainer.

It was a busy week for Torex Gold Resources as it reported a feasibility study for its Morelos gold project in Mexico, drill results from an exploration target on Morelos and its third-quarter financials. All this news brought on heavy trading, making the company the week’s second most active stock with 25.2 million shares traded. The junior closed up 10¢ at $1.90 per share. The feasibility study envisions two separate pits at Morelos feeding a 14,000-tonne-per-day mill to produce 337,000 oz. gold and 211,000 oz. silver during its first 10 years. The mine is slated to start initial production in 2015. During the third quarter ended July 31, 2012, Torex reported a net loss of $15.1 million, almost double the loss from a year ago. However, it spent $13.2 million on exploration and evaluation expenditures during the period, which is roughly twice the amount spent a year earlier.

Detour Gold saw its shares add $2.37 to end at $27.17 after it published an updated production plan for its Detour Lake gold mine in northeastern Ontario. Detour says that construction reached the 87% mark by the end of August, with the mine on track to come online early next year. It noted that the mine’s pre-production capital cost crept up as expected because of rising input costs. While pre-production capital cost is unchanged at $1.45 billion, sustaining capital rose to $1.2 billion from $998 million estimated last January, and average projected total cash costs increased to $749 per oz., up from $542 per oz.

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