Gold up, US equities down, during week of Sept. 27-Oct. 1

Gold continued its ascent during the week of Sept. 27-Oct. 1 to finish at US$1,318.60 per oz. while U.S. equities dipped on both the Dow Jones Industrial Average and the S&P 500 index. The DJIA fell 30.58 points or 0.28%to 10,829.68, while the S&P slipped 2.43 points or 0.21% to 1,146.24. The Philadelphia Gold and Silver index rose 1.6% or 3.18 points to close the period at 200.06. Silver was the best performing metal of the week, up 4.7%, while zinc was the worst performer, down 2.4%.

Seven companies reached new 52-week share price highs on the New York Stock Exchange: Agrium, ASA (Bermuda), Buenaventura, Ivanhoe Mines, Mesabi Trust, Silver Wheaton, and Sociedad Quimica y Minerale de Chile. Of them, Peru’s Buenaventura topped the list of value gains on the back of strong gold and silver prices with a jump in share price of US$4.68 to US$46.53. Mesabi Trust, a royalty trust deriving income from the Peter Mitchell iron ore mine near Babbitt, Minnesota, followed in second place with a gain of US$4.21 to US$38.04, on rising demand for iron ore.

Increasing silver prices saw Silver Wheaton, the world’s largest silver streaming company, become the fifth most actively traded stock of the week with 39.1 million shares changing hands. The company’s share price edged up 7¢ apiece to close the week at US$26.67 per share. In mid-August Silver Wheaton reported record financial results for the second quarter ended June 30. Net earnings rose by almost 200% to a record US$53.3 million (US$0.16 per share), up from US$18.4 million (US$0.07 per share) in 2009, while operating cash flow increased by more than 150% to US$67 million (US$0.20 per share), compared with US$26.5 million (US$0.09 per share) in 2009.

Gold producers Agnico-Eagle Mines and AngloGold Ashanti were both up strongly on no news, with the former advancing US$2.05 to US$71.27 and the latter rising US$1.82 to US$47.06.

Potash plays were all down due in part to uncertainty hanging over future pricing in the sector. Potash Corporation of Saskatchewan led the retreat with a loss of US$3.36 per share to US$142.64. Mosaic dropped US$2.47 at US$59.62, and Agrium lost US$2.17 to US$75.01 per share.

Diversified miner Teck gained US$3.13 to US$42.47 on news Sept. 29 that employees at the Coal Mountain operation in southeastern British Columbia ratified a new five-year agreement, replacing an agreement that expired on Dec. 31, 2009. The agreement means production will resume following a temporary suspension due to strike action by the United Mineworkers of America.