U.S. equities rise in Dec. 21-30 trading period

While the European debt crisis continued to weigh heavily on international investors, better than expected economic data in the U.S. drove a pre-holiday rally in U.S. equities. The number of Americans filing new claims for unemployment benefits hit a three and a half year low in the week before Christmas, while consumer sentiment climbed to a six-month high in December. The Dow Jones Industrial Average advanced 113.98 points or 0.94% to close the Dec. 21-30 trading period at 12,217.56, while the S&P 500 index rose 16.3 points or 1.31% to 1,257.60. The price of gold fell from US$1,615.20 per oz. on Dec. 20 to about US$1,566.40 on Dec. 30, taking the Philadelphia Gold and Silver index down 4.76 points or 2.57% to 180.64.

Freeport McMoRan Copper & Gold was the second most actively traded stock, falling US$0.79 to US$36.79 per share. Reuters reported on Dec. 30 that workers at the company’s Indonesia unit would return to work at the Grasberg mine on Jan. 2 after a three-month strike officially ended on Dec. 14. The delay in resuming work was due to a dispute with a contractor, which has since been resolved.

China’s Yanzhou Coal advanced US$1.18 per share to close at US$21.20 after it announced on Dec. 22 that it plans to merge its Australian unit with Sydney-based Gloucester Coal in a deal worth A$700 million. Yanzhou will own 77% of the new company with shareholders of Gloucester owning the remainder. The planned merger will create one of Australia’s largest listed coal companies.

Banro Corp. rose 14.5% to US$3.70 per share after the Canadian gold explorer announced that measured and indicated resources at its Namoya project in the Democratic Republic of Congo have grown by 39% over a previous estimate from January 2011. Namoya’s measured and indicated resources now total 24.77 million tonnes grading 1.99 grams gold per tonne for 1.58 million ounces of contained gold at a cut-off grade of 0.4 gram gold per tonne. The previous estimate had put measured and indicated resources at 14.58 million tonnes grading 2.43 grams gold per tonne for contained gold of 1.13 million ounces.

On the negative side of the ledger, Newmont Mining fell US$2.60 to US$60.01 on no news. Over the last month the company has been hit by intermittent work stoppages at its Conga and Yanococha operations in Peru. Newmont suspended construction activities at the Conga project on Nov. 30. The project’s environmental impact assessment was approved in October 2010.