TSX falls during June 13-17 trading week

Growing fears of a recession and an aggressive 75-basis point hike by the U.S. Federal Reserve had markets reeling over the June 13-17 trading period. The S&P/TSX Composite Index dove 1,344.34 points or 7.1% to 18,930.48; the S&P/TSX Global Mining Index tumbled 8.76 points or 8.5% to 103.48; and the S&P/TSX Global Base Metals Index fell 19.59 points or 11.5% to 169.48. The S&P/TSX Global Gold Index fell 15.18 points or 5.2% to 288.56, while spot gold strengthened slightly, ending the week up 0.6%, or US$11.50 per oz. higher, at US$1,841.50 per ounce. 

Shares of UEX Corp. rose by 19.3% to 34¢ as U.S.-based Uranium Energy Corp. announced it would acquire the company in a friendly, all-share deal. Each common share of UEX will be exchanged for 0.0831 of a share is UEC. The share exchange ratio implies a value of about 43¢ per UEX Share, which is a premium of about 50% based on the closing price of its shares on the Toronto Stock Exchange on June 10. The deal is expected to close in August. At closing, existing UEC and UEX shareholders will respectively own 86.3% and 13.7%, of UEC’s shares. “UEX shareholders will gain substantial exposure to production-ready low-cost U.S. ISR (in situ recovery) mining assets, a substantial physical uranium portfolio, a strong balance sheet and access to capital,” said Roger Lemaitre, CEO of UEX in a press release. UEX holds exploration projects in Saskatchewan Athabasca Basin, including several JVs with major uranium producers. 

Shares of Mandalay Resources rose 10.8% to $3.49 after the company reported drill results from the Robinson propect at its Costerfield operation in Victoria, Australia on June 9. Highlights from the drill results included 0.17 metre (true width of 0.15 metre) grading 1,780 grams gold per tonne starting at 125.1 metres in hole RB007; and 0.4 metre (true width of 0.24 metre) grading 13.1 grams gold, starting from 122.2 metres in hole RB004. In a press release reporting the “extraordinary result,” Dominic Duffy, the company’s CEO said: “The high-grade results look to be related to the historic Robinson mine which… produced high-grade gold ore during the 1880s.”  

Shares of TRX Gold Corp. increased by 10.6% to 52¢ after the company announced its preliminary third-quarter production of 2,733 oz. gold at its Buckreef project in Tanzania. The figure exceeded its production guidance of 750 to 800 oz. gold per month. It also announced sales of 3,033 oz. The company is looking to expand its current 360 tonnes per day processing plant at Buckreef to 1,000 tonnes per day. Buckreef is situated about 45 km west of Barrick Gold’s Bulyanhulu gold mine and 35 km south from AngloGold Ashanti’s Geita mine in north-central Tanzania. The project hosts measured and indicated resources totalling 35.9 million tonnes grading 1.77 grams gold per tonne for 2 million ounces.