Toronto Stock Exchange, May 27-31

The S&P/TSX Composite Index slipped during the trading week, losing 16.8 points to 12,650.42, as investors considered the bleak economic data coming out of Europe and the U.S.

Unemployment in the eurozone rose to a new high of 12.2% in April, and inflation stayed below the European Central Bank’s 2% target, reaching 1.4% in May. 

The U.S. Commerce Department reported that consumer spending dipped 0.2% in April, the first drop since last May, after adding 0.1% in March. The April reading fell below analysts’ expectations of a 0.1% gain.

The S&P/TSX Global Gold Index held onto positive territory, tacking on 16.83 points to close at 205.48, as the spot price for gold gained US$2 per oz. to US$1,388.30. The base-metal miners didn’t fare as well, as the S&P/TSX Capped Diversified Metals & Mining Index skidded 9.65 points to 832.77.

The week’s top percentage gainer, Polar Star Mining, soared 75% to 18¢ on the back of trenching results from its Montezuma property in northern Chile. The company completed 3,900 metres of trenching at Montezuma’s Melisa target, with the results showing significant copper mineralization throughout the target area, as well as finding two new mineralized porphyry structures within Melisa’s Collapse zone. Polar Star intends to start drilling the most promising targets on the project in the third quarter.

Rainy River Resources advanced 58% — or $1.33 a share to $3.64 — after New Gold offered to buy the junior in a friendly $310-million deal for its feasibility stage Rainy River gold project in northwestern Ontario. The project, boasting a 4 million oz. gold reserve, will increase New Gold’s reserves by 40%.

Under the agreement, Rainy River shareholders could receive either half a New Gold share or $3.83 in cash, representing a 42% premium over its May 30 closing price. New Gold intends to cap the offer at 25.8 million shares and $198 million in cash.

Rainy River was also the second most actively traded stock with 32.5 million shares changing hands, behind Osisko Mining, which saw 35 million shares traded to tiptoe up 22¢ to $4.46 on no news.

On the flip side, Atna Resources was the biggest percentage loser, plummeting 49% to 23¢ after placing its Pinson gold mine in Nevada under review due to falling gold prices and a tight cash balance. As part of the review, Pinson’s underground mining rates have been reduced to 100–150 tons a day and its workforce has been cut in half.

Agnico Eagle Mines was continuing strong during the period after announcing it bought a 9.94% stake in Probe Mines for $15 million a week earlier. Agnico, which has made a handful of investments in juniors this year, topped the week’s value chart, gaining $4.29 per share to $33.70.

TSX most active issues

TSX greatest percentage change

TSX greatest value change