Mining Journal > Finance > Stockpile: Few losers as metals advance

Strong gains in metals prices this week meant there were only a handful of fallers on London Stock Exchange's main board this week.

The gold price breached US$1,600/oz for the first time in history as continued fears over Europe’s debt crisis and political negotiations dominated headlines earlier this week. In the US a impasse continues between political parties over raising the US debt ceiling.

By Friday afternoon, the latest aid package for Greece was said to have helped boost base-metals prices, along with supply concerns owing to strikes from some of the world’s larger copper mines.
Talvivaara plc was a notable gainer, adding nearly 7% in the week after Numis Securities upgraded the Finnish nickel producer from “hold” to “add”.

Russian gold producer Petropavlovsk plc gained by 3% and on Thursday closed at its highest level in two months, after announcing a 43% gain in gold production in the three-months to June, compared to a year earlier.

Anglo American plc was the best performer of the big four diversified miners, adding just over 2% in the week. Subsidiary Kumba Iron Ore Ltd, reported positive results for the six months to end-June on Thursday, thanks to higher iron-ore prices. The South African iron-ore producer’s profits would contribute US$824 million to Anglo’s own underlying profits. Only two years ago, Kumba contributed just US$230 million to the same period’s earnings.

On AIM, Horizonte Minerals surged more than 21% after reporting a high grade intercept at its Araguaia nickel project in Brazil.

The explorer said the best intersection was 2.25% Ni over 17.3m from infill drilling at the Pequizeiro target. Other notable intersections included 15.6m at 1.97% Ni, 13.8m at 1.96% Ni and 19.6m at 1.84% Ni.

Turkey-focused gold Ariana Resources plc gained more than 18% after announcing it has completed the acquisition of four exploration licenses from Kefi Minerals plc.

Mwana Africa plc moved 8% higher and received promising coverage from Ambrian Capital during the week regarding its gold, nickel and other base metal operations.

Ambrian rated the company’s stock as a ‘buy’, adding that it represents value through the opportunity it has to restart the Bindura nickel mine in Zimbabwe.

Minera IRL added 10.5% after delivering encouraging news regarding its Ollachea gold project in Peru.

The Latin American company announced the completion of its prefeasibility study at the project, which said it could produce 117,000oz/y of gold from 2014.

Minera then reported that Ollachea had been endorsed by the local community at a general assembly meeting.

Other companies to make significant gains included Metals Exploration plc and Kryso Resources plc, which advanced by 14% and 11% respectively.

Regency Mines plc dropped back 13.5% for the week, after gaining about 20% on July 15, to be the week’s biggest faller. The explorer has lost close to 60% of its value this year.

Solomon Gold plc was about 13% lower despite releasing encouraging gold and silver results from drilling at its Kauffmans-Homestead property in Queensland.

The company said the results included 20m at 8.44g/t Au and 12.1g/t Ag from 88m.

Weatherly International dropped 12% after delaying the 'bankable' feasibility study (BFS) at its Tschudi copper project in Namibia. The company explained that the study has been expanded to ensure it meets the rigorous technical and financial requirements of a BFS.

Other companies to make notable losses included Anglo Asian Mining plc and Condor Resources plc, which fell 9.5% and 8.5% respectively.