US indices inch higher during Mar. 20-24 trading week

The Dow Jones Industrial Average gained 604.76 points or 1.89% and the S&P 500 closed 72.15 points or 1.6% higher at 3,979.15 over the Mar. 20-24 trading week.

Mexico and Peru-focused Southern Copper led the miners in terms of value gainers, closing the week US$3.13 higher at US$71.24 per share. Despite a drop in 2022 production reported in its 2022 full-year results on Mar. 15, the company is anticipating low-cost production growth, backed by its top-tier copper reserves. Southern Copper has introduced cost-control measures that should help offset the impact of inflated fuel, labour, and operating costs. In 2022, the company registered a 6.6% year-over-year decline in copper production to 894,703 tons due to work stoppage at the Cuajone mine in Peru and lower ore grades. Molybdenum production was 13.3% down to 26,240 tons because of lower ore grades at the Toquepala mine in the same country. Zinc production was down 10.4% yearly to 60,010 tons due to lower production at the Charcas and Santa Barbara mines in Mexico. Mined silver production was 18.6 million oz., down 2.1% from last year.

The week’s top-traded issue was Vale, which saw 138.5 million shares change hands to close US84¢ lower at US$14.95. The company’s stock has decreased 25% over the past 12 months. The Brazil-based mining major recently split its base metals unit from its predominantly iron ore business. It belives that doing so will allow it to capitalize on the electric vehicle transport transition opportunity better. “To be clear, Vale is not planning to sell the business,” Ontario operations head Gord Gilpin told the Sudbury Star on Mar. 24. “Vale views base metals as their main source of growth for the future. This forces us to be much more focused as a standalone business.”

South Africa’s Gold Fields was the biggest percentage gainer during the week, adding 10.8% to close at US$12.80 per share. On Mar. 16, the company and AngloGold Ashanti announced a proposed joint venture combining the Tarkwa and Iduapriem mine in Ghana to create Africa’s largest gold mine and one of the world’s most extensive open-pit gold operations. Once combined, the neighbouring mines are projected to produce nearly 900,000 oz. gold annually during the first five years and, on average more than 600,000 oz. annually over an estimated 18-year-mine life. Gold Fields owns a 90% stake in Tarkwa, with the government of Ghana owning the remaining 10%, and AngloGold Ashanti owns 100% of the Iduapriem mine.