TSX climbs on positive economic data

Positive economic data from the U.S. had investors less afraid of the dreaded double-dip recession and the TSX Composite Index partook in that new optimism as it climbed from 265 points to finish the Aug. 30 – Sept. 3 period at 12,144.92.

And while Canadian investors are divided over whether or not the Bank of Canada is set to raise rates a key U.S. manufacturing index surprising on the upside was all the base metal complex needed to get a boost. The prices of aluminum, nickel, tin, lead and zinc were all higher and copper rose to the US$3.47 per lb. level. All that upward movement in the metals had the Capped Metals & Mining up 83 points to 1,013.88

And while the more positive economic outlook didn’t hamper the price of gold – the yellow metal climbed US$14 to finish the period at US$1,249 – it did hurt many gold miners as the Global Gold Index fell by 3 points to 391 points.

One gold miner that didn’t follow the trend of its peers was Andean Resources – although the company had Goldcorp and Eldorado Gold to thank for its good fortune.

Andean shares shot up 50% for the period to finish at $6.98 after first Eldorado and then Goldcorp made bids for the company. Goldcorp bested Eldorado’s $3.4 billion, all share offer with a $3.6 billion offer that combines shares and cash. Also bolstering Goldcorp’s chances at successfully landing the company is the fact that its offer has the unanimous support of Andean’s board.

The reason for the fuss over Andean has to do with its Cerro Negro project in Argentina. While the project already has over 3 million oz. of gold outlined in its resource estimate, both Goldcorp and Eldorado believe there is significantly more ounces to be found at the project.

In other merger and acquisition news, Fronteer Gold secured a full interest in its key asset by acquiring AuEx for $238 million. The deal, which is made up of a combination of cash and stock secures the Long Canyon gold exploration project in Nevada for the company. Vancouver-based Fronteer currently holds 51% of the high-grade project while AuEx has the remaining 49% stake. The deal will also get Fronteer a 49% stake in the smaller West Pequop property, which currently is an early stage exploration project. Fronteer’s shares finished the period 59¢ lower at $7.80 while AuEx shares climbed $1.26 to finish at $5.76.

It was also a busy period for Golden Predator. The Yukon-focused gold explorer saw its shareprice climb 42% to finish at 68¢ after announcing drill results from one project and increased land holdings. The drill results came out of its Brewery Creek project which returned a highlight assay of 7.62 metres grading 4.16 grams gold. Golden Predator also announced that it had doubled its land holdings in the territory by way of acquiring 659 sq. km of prospective land north of its Cynthia project in east central Yukon.