U.S. markets, Jan. 13-17

The story south of the border was a bit of a mixed bag as investors bought on positive earnings reports and rising industrial production, but sold on a decline in housing starts.

The result was a rise in the Nasdaq by 30 points to 4,197.58 points and the Dow Jones Industrial Average by 24 points to 16,458.56, but a drop in the S&P 500 by 3 points to 1,845.89 points for the period.

For gold bugs the news moved in one direction — to the upside.

The yellow metal has climbed US$54 per oz. since the new year. It was selling for US$1,251.90 per oz. at the end of the period, which helped bolster the fortunes of gold miners and gold royalty companies. Randgold Resources, Franco-Nevada, Agnico Eagle Mines and Royal Gold were top of the class in terms of the biggest dollar gains amongst the miners listed on U.S. exchanges.

In the case of Randgold, its dollar gain of US$4.61 to US$65.32 came ahead of results from its Kibali gold mine in the Democratic Republic of the Congo. The mine recently finished its first quarter of operations, with the first gold pour at the site coming only after it resettled 4,000 families from 14 villages into a new town. Next the company will sink a shaft for the underground mine and build the first of four hydro-power stations. The company expects the mine to achieve 550,000 oz. gold production for the year.

Rio Alto Mining also delivered positive news on the production front, and the market bid the company’s stock up 29% to $2.20. The company said it was closing in on copper production at its La Arena project in northern Peru, with a recent environmental approval for an 18,000-tonne-per-day, open-pit sulphide operation. The approval allows the company to expand the mine, which produced between 190,000 and 210,000 oz. gold in 2013. The company says phase-two construction should start later this year, depending on its receipt of construction permits. 

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