Toronto Stock Exchange New Year ushered in with three-day rally

The New Year is being ushered in with a three-day rally which has added more than 103 pts to the tse composite index. Today, the index picked up 25.29 pts to close at 3,263.3 pts. Market players are keeping a close eye on the early trading this year. Most believe the next couple of weeks will be a precursor of activity for the first quarter. If that thinking holds true, then we should expect to see an trend well before March.

In light of the current strength, last year’s market collapse seems a long time ago. The message here is that despite the current strength, it’s no time to become complacent.

Despite a modest recovery in the value of the U.S. dollar, gold bullion strengthened to $485 (US) per oz. The firmer price was reflected in the exchanges’s gold and silver index which advanced by 119.58 pts to 7,574.8 pts today. Gold proxies such as American Barrick Resources moved from $26.25 at the opening to close at $26.63. Placer Dome Inc, another big player, was up marginally by 13 cents to $20.13. Lac Minerals was also better, adding 50 cents to $13.50.

The largest Canadian resource equity issue of the post-October 19 era is being made by Falconbridge Inc. The nickel and copper mining major has agreed to sell 4.5 million units to Gordon Capital and Dominion Securities for $23.75 per unit or a total of $106.87 million. Placer Dome, which holds a big stake in Falconbridge, will pick up another 1.5 million units, pushing total proceeds to Falconbridge over $142.5 million. The common shares weakened today to $22.88 — off 38 cents for the day.

Another Falconbridge affiliate, 73.8%-owned New Quebec Raglan Mines is also enjoying the boom in nickel prices. The issue soared to a new high of $3.25 before dipping back to $3. Last week the issue could be had for less than $2. A company spokesman says there are no plans to bring Raglan’s huge high grade nickel deposit in Quebec’s Ungava area to production. Such a capital intensive project would require well over $100 million, The Northern Miner estimates.

Two exploration plays which are driving share prices were Golden Terrace Resources and T & H Resources. Both are familiar to readers of this column. Last year each made market waves on big volumes following gold discoveries. Golden Terrace was a volume leader trading up to $3.75 before sliding back to the 70 cents range. Today, Terrace churned through 151,000 shares to close at $1.35 — up 60 cents in one day. Terrace is busy drilling a small gold deposit east of Red Lake, Ont.

T & H was also active, opening up at $1.35 and closing 69 cents higher at $2.04. The company is drilling a property in the Harker-Holloway area east of Matheson, Ont.

It’s poker time at Getty Resources. The company, which is the object of a $125 million takeover bid by French company Total Resources, has told its shareholders the offer is too low. Getty is hoping another bid will come from other companies. The issue closed lower at $10.38 after opening up at $10.75. Total is bidding $10 per share. Shorts are betting that no other bid will be forthcoming and Getty will go with the original $10 bid. Traders going long are discounting a future higher offer.

In B.C., Northair Mines has come up with a strong drill hole at its Willa property (see front page story). The issue added 50 cents on the news to close at $2.

Northgate Exploration, which will have about $200 million in the bank following the completion of the sale of its Chibougamau, Que., mines to Western Mining Corp., can be expected to make a mining acquisition this year. The issue was quiet at $7.50. Sonora Gold, which operates a large open pit gold mine in California, was better at $7.63.