US vote casts spell on gold

Election day jitters south of the border sent gold US$7.20 per oz. lower to US$419.70 per oz. in New York on the first Tuesday in November. The one-day drop pushed the yellow metal US$8.55 lower over the Oct. 27-Nov. 2 report period, and the rest of the precious metals tagged along.

Not surprisingly, the gold index dropped 8.56 points to 207.52. The country’s diversified miners finished 4.62 points lower at 236.01, as the base metals finished lower across the board. Still, the S&P-TSX composite index managed to gain another 79.94 points to make 8,870.94.

Wheaton River Minerals was the most-traded mining stock, falling 15 to $3.82 on about 20 million shares. Eldorado Gold was close behind, with more than 14 million shares making their way 18 lower to $3.58. Eldorado finished the third quarter with a net loss of US$1.3 million, compared with a year-earlier loss of US$1.6 million. The decrease is attributed to lower sales volumes and higher operating costs.

Yorbeau Resources ranked among the mining sector’s leading percentage movers, jumping 7, or 14%, to 57. The shares benefited from the latest round of chip sampling on the company’s Astoria II property, near Rouyn-Noranda, Que. Highlights include 5 metres at an uncut grade of 274.7 grams gold per tonne, including coarse visible gold.

AfriOre rose 19% to 50. The company recently sold off its coal portfolio to a group of South African black economic empowerment companies for around $7 million. The sale is consistent with AfriOre’s plan to focus on gold and platinum exploration in Africa. Proceeds will be used settle an outstanding debenture of $1.1 million and acquire an advanced-stage platinum project.

Heading the other way was Australian uranium explorer Southern Cross Resources, which plummeted 22, or 27%, to 59. The company recently announced it would hold off on developing its Honeymoon project in southern Australia, owing to a weakening U.S. dollar and higher costs.

Partners Dynatec and FNX Mining also took hits: the former ended two pennies cheaper at $1.18, while the latter dropped 55 to $5.10. Elevated levels of noxious gas have forced the suspension of work at the Levack nickel mine, a former producer northwest of Sudbury, Ont. Levack and the nearby McCreedy West mine are currently the subject of a feasibility studies; production could begin in 2005. Operations at FNX’s McCreedy West remain unaffected. The source and nature of the gas are being investigated; no employees were on the property when the gas was detected.

Also down was Thistle Mining, off 3.5 at a nickel and a half. Standard Bank gave the company written notification of default on its credit facilities. Talks aimed at remedying the situation are in progress.

Jonpol Exploration failed to hang on to early gains and finished off 4 at 32. The company and Vancouver-listed Elgin Resources have unveiled plans to amalgamate and take a controlling interest in the Spitzkop platinum-group-metal deposit on the eastern limb of South Africa’s Bushveld igneous complex.