Mining Shares Rise With Gold, Silver; Excellon Continues Outperformance
Friday April 08, 2016 12:01
(Kitco News) - Most mining shares that trade in North America rose during the first four days of the week, helped by higher gold and silver prices, with smaller to intermediate-sized companies being the biggest gainers.
Copper producers tended to get knocked down as the price of the red metal fell.
As of late Thursday, Comex June gold futures were at $1,242 an ounce, a gain of $18.40, or 1.5%, for the week so far. Comex May silver was up 18 cents, or 1.2%, for the first four days of the week at $15.23.
During that same time span, the NYSE Arca Gold Bugs index (HUI) was up 6.4004 points, or 3.6%, to 186.3126. The Market Vectors Gold Miners exchange-traded fund (GDX), which consists of stocks of gold-mining companies, rose 66 cents, or 3.3%, to $20.78 per share.
Shares of Excellon Resources (TSX: EXN) continued its surge from recent weeks, this time climbing 17 cents, or 28%. Excellon operates the high-grade La Platosa silver mine in Mexico. The company has embarked upon a new optimization plan to manage water issues at the mine, which officials say should hike output while slashing costs. This week, Excellon announced the closing of a non-brokered equity private-placement by well-known precious-metals investor Eric Sprott, resulting in proceeds of C$3 million.
Excellon Resources Inc.
Arizona Mining (TSX: AZ), a mineral exploration and development company looking to develop its Hermosa project in Arizona, saw its shares climb another 16 cents, or 20%. The company got some favorable analyst comments.
OceanaGold Corp. (TSX: OGC) climbed 44 cents, or 12%. The company last week received a five-year extension for the exploration period under its financial or technical assistance agreement in the Philippines. The company also reported that gold reserves increased 80% year-on-year mainly as a result of the additional reserves from the Waihi and Haile gold mines that were acquired. This week, OceanaGold reported a C$6.67 investment in shares of NuLegacy Gold Corp.
Silvercorp Metals Inc. (TSX: SVM), a Canadian company with multiple mines in China, was up 23 cents, or 12%.
Centamin (TSX: CEE) added 19 cents, or 11%. The company reported preliminary first-quarter gold production from its Sukari gold mine in Egypt of 125,268 ounces, which was a 6.5% increase from the previous quarter and a 15.7% increase year-on-year. "These production results reflect a solid start to the year for Sukari and support our forecast 2016 production of 470,000 ounces of gold,” said Andrew Pardey, chief executive officer.
Guyana Goldfields Inc. (TSX: GUY) rose 51 cents, or 11%. The company said first-quarter output was 41,281 ounces at its Aurora mine in Guyana. The amount of ore mined for the year so far exceeds plan by 38%, the firm said. The mine achieved first production mid-2015. “Overall, the result represents an encouraging first step towards achieving 2016 production guidance of 130,000-150,000 ounces,” said BMO Capital Markets, describing the news as “positive.”
Kinross Gold Corp. (NYSE: KGC) rose for the second week in a row after saying it will go ahead with the phase-one expansion of the Tasiast mine in Mauritania, which got favorable analyst reviews. Shares gained 31 cents, or 9%.
Most of the week’s biggest decliners are in the copper business, as copper fell during the first four days of the week. As of late Thursday, Comex May copper was down during this period by 9 cents, or 4.1 %, to $2.0790 a pound.
First Quantum Minerals (TSX: FM), which is known as one of the world’s larger copper producers, fell $1.27, or 19%. Citi Research maintained a “neutral” rating of the stock, commenting that “the commodity price environment remains weak” and First Quantum shares have already rallied sharply since the January lows.
Pacific Booker Minerals (TSXV: BKM) lost 16 cents, or 13%. The company is in the advanced stage of developing a copper/gold/molybdenum deposit on the Morrison property in British Columbia. The company this week announced intentions to voluntarily withdraw shares from NYSE MKT as part of an ongoing emphasis on costs control.
Freeport-McMoRan Inc. (NYSE: FCX), the world’s largest publicly-traded copper company that is also in the gold, molybdenum and energy businesses, fell $1.04, or 11%. The company this week announced a new organizational structure for its energy division, including the departure of the top executive at Freeport-McMoRan Oil & Gas.