The takeover theme continued to dominate the market over the May 1-7 trading period, fuelling speculation that more Canadian companies will be targeted and driving the TSX Composite Index upwards. The index gained 448.83 points to close the session at 13,865.51.
While Alcoa’s hostile takeover bid for Alcan was the biggest news of the week, acquisitions and for-sale signs in the oilsands also played a part in the index’s gains — as were good first-quarter earnings and signs of strength in the Canadian economy. New figures showed economic growth accelerated by 0.4% in February — up from 0.1% the month before.
Strong metal prices added to the good news. Copper climbed to US$3.71 per lb., nickel rose to US$23.95 per lb., tin increased to US$6.52 per lb., lead touched 93 per lb., and zinc ended the week at US$1.85 per lb.
It all added up to big gains for the Capped Metals & Mining Index, which saw a 10% gain over last period’s close to 792.35 points.
Gold also made gains after a mild slump. The metal was up roughly US$10 to US$688.80 per oz., helping to nudge the Global Gold Index up 10.05 points to 301.83.
News that Alcoa was launching a hostile takeover for aluminum rival Alcan sent Montreal-based Alcan’s shares up 34% to $90.57, indicating that investors anticipate a still higher bid. Rio Tinto and BHP Billiton have been named as potential suitors. If Alcoa can complete the acquisition, the combined company would become the world’s largest producer of aluminum.
Shares of LionOre Mining International jumped 25% after Russia’s Norilsk Nickel — the biggest nickel producer in the world — offered $5.3 billion for the miner. The offer betters Swiss-based Xstrata’s previous bid, which had been accepted LionOre’s board, by 16%. LionOre shares finished the period up 28% at $24.04.
More drill results from Inspiration Mining’s Langmuir nickel project south of Timmins, Ont., had the Vancouver-based company’s shares up 25% to $7.45. Intervals were highlighted by 1.75% nickel over 23.82 metres, with 15.5% nickel over 1.29 metres true width. Langmuir was a past-producing nickel mine.
When costs of production come in at $17.1 million and value of that production is just $7.3 million, a company’s shares are in for a fall. That was just the case with Toronto-based Tahera Diamond, which continues to struggle to curry market favour for its Jericho diamond mine in Nunavut. Tahera’s shares tumbled 17% after announcing its first-quarter results on May 4. The company says it is implementing a number of measures recommended by Teck Cominco to help increase efficiency and improve revenue.
The period’s most popular miner was Eastern Platinum with trading volume of roughly 50 million shares. The company announced plans to upgrade capacity at its smelter in South Africa and that it is nearing completion of its acquisition of Barplats Investments.
TSX greatest percentage change
| VOLUME(000s) | HIGH | LOW | CLOSE | CHANGE | |||
| Alcan | AL | 22476 | 90.93 | 66.21 | 90.57 | + | 36.8 |
| Contl Precious | CZQ | 5602 | 5.20 | 4.03 | 5.10 | + | 27.5 |
| Inspiration Mg | ISM | 872 | 7.45 | 5.82 | 7.45 | + | 25.2 |
| Campbell Res | CCH | 11038 | 0.155 | 0.12 | 0.15 | + | 25.0 |
| European Ml wt | EPM_T | 30 | 0.55 | 0.475 | 0.55 | + | 22.2 |
| Olympus Pacif | OYM | 1147 | 1.20 | 0.75 | 0.85 | + | 16.4 |
| Canadn Zinc | CZN | 2352 | 1.02 | 0.86 | 1.00 | + | 16.2 |
| Platinum Gp Mt | PTM | 603 | 4.69 | 3.95 | 4.60 | + | 15.8 |
| European Minls | EPM | 1628 | 1.50 | 1.31 | 1.48 | + | 13.8 |
| Pure Diam Expl | PUG | 886 | 0.34 | 0.255 | 0.30 | + | 13.2 |
| Tahera Diam | TAH | 3848 | 0.84 | 0.67 | 0.70 | – | 14.6 |
| Ascendant C wt | ACX_T | 20 | 0.115 | 0.105 | 0.105 | – | 12.5 |
| Kimber Res | KBR | 179 | 1.76 | 1.57 | 1.57 | – | 9.2 |
| Ontex Res | ONT | 39 | 0.225 | 0.205 | 0.205 | – | 8.8 |
| Northgate Mnls | NGX | 2853 | 4.06 | 3.73 | 3.77 | – | 8.0 |
| Gitennes Expl | GIT | 98 | 0.27 | 0.25 | 0.25 | – | 7.4 |
| Jaguar Nickel | JNI | 520 | 0.28 | 0.24 | 0.26 | – | 7.1 |
| Gold Eagle Mns | GEA | 1104 | 8.74 | 7.90 | 8.00 | – | 6.4 |
| South Am Silvr | SAC | 319 | 0.65 | 0.58 | 0.59 | – | 6.3 |
| Caldera Res | CDR | 342 | 0.08 | 0.075 | 0.075 | – | 6.2 |
TSX greatest value change
| VOLUME | CLOSE | CHANGE | |||
| Alcan | AL | 22475929 | 90.57 | + | 24.39 |
| First Quantum | FM | 659519 | 84.52 | + | 3.02 |
| Inmet Mining | IMN | 775494 | 74.89 | + | 1.82 |
| Katanga Mng | KAT | 1010982 | 15.97 | + | 1.80 |
| Aurora Energy | AXU | 653402 | 19.99 | + | 1.73 |
| HudBay Minls | HBM | 6174034 | 25.05 | + | 1.57 |
| Inspiration Mg | ISM | 872018 | 7.45 | + | 1.50 |
| Labdr I-Ore Ro | LIF_U | 382109 | 33.10 | + | 1.45 |
| FNX Mining | FNX | 3253583 | 30.41 | + | 1.26 |
| Aber Diamond | ABZ | 868262 | 42.15 | + | 1.25 |
| Gammon Lk Res | GAM | 1616216 | 17.45 | – | 0.80 |
| Gold Eagle Mns | GEA | 1103777 | 8.00 | – | 0.55 |
| Forsys Metals | FSY | 531508 | 9.07 | – | 0.52 |
| Tenke Mining | TNK | 769731 | 24.91 | – | 0.40 |
| Blue Pearl Mng | BLE | 2926391 | 17.35 | – | 0.34 |
| Northgate Mnls | NGX | 2852830 | 3.77 | – | 0.33 |
| IAMGold Corp | IMG | 5445667 | 8.54 | – | 0.31 |
| Centerra Gold | CG | 506846 | 10.95 | – | 0.27 |
| Gold Reserve | GRZ | 658784 | 7.76 | – | 0.27 |
| Linear Gold | LRR | 42330 | 5.00 | – | 0.23 |
TSX most active issues
| VOLUME(000s) | HIGH | LOW | CLOSE | CHANGE | |||
| Eastern Platin | ELR | 41228 | 2.64 | 2.40 | 2.63 | + | 0.24 |
| Alcan | AL | 22476 | 90.93 | 66.21 | 90.57 | + | 24.39 |
| Breakwater Res | BWR | 21415 | 2.44 | 2.17 | 2.35 | 0.00 | |
| LionOre Mng In | LIM | 16998 | 24.12 | 23.43 | 24.04 | + | 0.29 |
| F irst Nickel |
FNI | 12707 | 1.98 | 1.76 | 1.85 | – | 0.02 |
| Goldcorp | G | 12199 | 28.41 | 27.54 | 27.60 | + | 0.21 |
| Campbell Res | CCH | 11038 | 0.155 | 0.12 | 0.15 | + | 0.03 |
| Equinox Minls | EQN | 10046 | 2.65 | 2.54 | 2.59 | + | 0.04 |
| SXR Uranm One | SXR | 8446 | 17.40 | 16.50 | 17.29 | + | 0.48 |
| Sherritt Intl | S | 8259 | 17.25 | 15.62 | 16.62 | + | 1.14 |
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