China’s slowed growth hurts TSX, April 9-13

The S&P/TSX Composite Index slid for the seventh week, ending April 9-13 down 63 points at 12,040.39 as investors assessed China’s growth data and Europe’s continuing debt crisis.

During the week, China reported its growth domestic product grew by 8.1% in the first quarter, down from 8.9% in the fourth period and below economists’ growth predictions of 8.4%. This marks China’s weakest period since the second quarter of 2009.

On April 13, news of higher bond yields in Spain and Italy, stirred concerns about whether these countries could pay its debts.

As a result, investors drove the spot price of gold to US$1,658.50, up US$27.20 per oz. in New York.

This helped bolster the S&P/TSX Global Gold Index, which moved up 10 points to close at 320.96.

The diversified miners followed the same trend, posting a 37-point gain as the S&P/TSX Capped Diversified Metals & Mining Index closed at 1,059.06 points.

Producer Gran Colombia gained 34% during the week to close at 45¢. It announced that its chairman, Serafino Iacono, recently bought over 2 million shares in the company at an average price of 36.7¢ a share. This brings Iacono’s total shares to 7.2 million, representing 1.9% of the company.

On April 15, Gran Colombia reported a new resource estimate for its Carla mine in Colombia. The mine has 59,000 oz. gold based on 250,000 tonnes grading 7.5 grams gold per tonne in the indicated category. It has another 54,000 oz. from 340,000 tonnes at 4.9 grams gold in the inferred category.

Drill results boosted Marathon Gold up 29% to close at 98¢. On April 10, the company reported eight new holes from this year’s 40,000-metre program at its Leprechaun gold deposit in Valentine Lake, Newfoundland. Highlights include 20.9 metres returning 7.23 grams gold per tonne, including a 1.9-metre intercept of 48.99 grams gold; and 13.5 metres carrying 9.19 grams, including 1.8 metres of 34.92 grams gold.

The deposit is part of the Valentine Lake project, which is equally held by Marathon and Mountain Lake Resources.

Two days later, Marathon reported its most significant intercept to date from the current 20,000-metre program at its jointly held Golden Chest mine in Idaho. The standout intercept returned 5.2 metres of 12.4 grams gold from 74.3 metres and 7.74 grams gold over 2.5 metres from 107.1 metres.

The property is held equally by the company and partner New Jersey Mining Corp., which is the operator.

Eldorado Gold was the second most traded stock for the week, following Cline Mining. The gold producer saw 19.3 million shares change hands as it reported its five year growth plans. Eldorado expects to produce 1.7 million oz. gold a year by 2016, a growth of 160%. Cash costs for 2012 to 2016 are anticipated at roughly US$350 per oz.

Eldorado gained $1.65 on the news closing at $14.40 per share.