Commodities lift TSX higher

The TSX Composite Index rose marginally for the Sept. 27 – Oct 1period to 12,363.08 from12, 246.37.

Investor enthusiasm could well have been tempered the Governor of the Bank of Canada, Mark Carney’s, speech in which he warned that there was unusual uncertainty surrounding the economic outlook of the country and that caution was warranted.

The low interest rate environment, however, combined with a weak U.S. dollar continued to be bullish for commodity prices and the Capped Metals & Mining Index reflected that strength as it continued its recent strong run by adding 30 points to finish the period at 1,156.34. The price of copper, nickel, tin and lead were all higher while aluminum and zinc prices were flat.

And while the yellow metal showed continued strength the Global Gold Index was down slightly for the period as it finished off 6 points to 394.26. The price of gold, however, was up to US$1,316.25 from US$1,289.00.

Word that Alexis Minerals had secured $60 million in financing had the company’s shares up 47% to 25¢. Alexis says money from the debt facility will go towards re-establishing its recently acquired Snow Lake Mine in Manitoba as a significant gold producer. The company says it will spend $45 million of the new funds developing and refurbishing the mill at the former Goldcorp mine which is expected to produce 423,000 oz. of gold over six years, although the company is currently engaged in an aggressive drill program that will seek to add to the life-of-mine reserves.

Baja Mining also rose on financing news. The company was up 27% to $1.19 after announcing a US$858 million financing that will allow it to push ahead with the development of its Boleo project in Mexico’s state of Baja California Sur. Baja holds a 70% interest while a group of Korean industrial companies hold the rest. The copper-cobalt-zinc-manganese project is targeted for copper commissioning in 2012.

Tungsten producer Malaga enjoyed a strong period as the company rose 36% to finish up at 19¢. The company received the last milling equipment it needed to process tungsten at a higher rate of 500 tonnes per day. Malaga had been producing tungsten with older equipment that came with the plant when it was acquired in 2005. The news dovetails well with rising tungsten prices which now stand at US$250 per tonne compared to the US$160 per tonne level it was selling for at the end of 2009.

And a ramp up in production was good news for Liberty Mines as well. The company announced that production from its Redstone nickel concentrator was up 69% to 95,587 tonnes in the third quarter. While the company currently produces nickel at the concentrator near Timmins it is also focused on the exploration, development and production of nickel, copper, cobalt and platinum group metals from its portfolio of properties in Ontario. Liberty’s shares were up 31% for the period to 21¢.