Canadian markets performed over the past week

The impact of the magnitude 9.0 quake hitting Japan, followed by tsunami waves and a string problems at the Fukushima Daiichi nuclear facility had investors running for the exits early in the trading week. By Thursday however, cooler heads had prevailed and the buyers came back into the markets with a vengeance. Once all the trading was done the TSX Ventures Exchange, home to more junior exploration companies than anywhere else in the world, had dropped 1.01 per cent, while the TSX Gold Index had fallen by 0.79 of a per cent.

Not a good time for uranium companies, one assumes?

No. With Japan struggling to avert nuclear meltdowns at several reactors, confidence in the future of nuclear power plummeted, and so did the uranium sector. The radioactive bloodbath in uranium equities was across the board and so bad that Uranium One announced that its ability to complete the acquisition of Tanzania-focussed Mantra Resources is now in jeopardy. Uranium One is pursuing Mantra in an all-cash A$1.2 billion deal. Uranium One fell C$2.03 to close at C$3.93.

The wider context being that the Japanese crisis has prompted China to state that it will slow its nuclear plant build-out program, and that the spot price of U308 fell by around 10 per cent on the week.

Yep and that resulted in shares in Cameco falling C$7.36 to C$28.96, and shares in Denison Mines falling C$0.62 to close at C$2.57.

Uranium exploration companies appear to have been the hardest hit.

That’s true, because they have the highest level of intrinsic risk even without taking into account the falling price of U308. A good example was advanced Canadian explorer Hathor Exploration, which lost C$0.76 to close at C$2.08.

Enough of the misery in the uranium sector. What’s happening elsewhere in the market?

Another bombshell came out of Colombia, as reports circulated that Greystar Resources had withdrawn its permit applications for the Angostura deposit in northeastern Colombia. Greystar then clarified the story by stating that it does not intend to withdraw completely from Angostura but is studying alternative development options, including a possible move to mine the project solely as an underground operation. Greystar hit a low of C$2.26 before ending the week down C$0.03 to close at C$2.75.

Next door however, Galway Resources continues to make good progress with drill results, and on the back of positive sentiment in the context of the recent US$1.6 billion acquisition of neighbour Ventana by one of the world’s richest men. Galway finished the week just about flat at C$1.02.

Meanwhile, Timmins Gold has increased its offer for Capital Gold in a last minute bid to thwart a rival offer by Gammon Gold. Under the increased offer, Capital Gold shareholders will receive 2.27 Timmins Gold shares and US$0.25 in cash for each share of Capital Gold held. Not to be outdone, Gammon came back with an offer of C$1.09 per share in cash plus 0.5209 Gammon share for each share of Capital Gold held. Let the games continue! The shareholder vote is now set for April 1st. Timmins Gold ended the week up C$0.15 at C$2.48, Gammon closed C$0.14 lower at C$8.50, while Capital Gold added C$0.14 to close at C$5.37.

And it was a wild ride for shareholders of Teck Resources. First off, the diversified major gave out disappointing coal sales guidance for the first quarter. Citing bad weather conditions, the company said sales have been affected because of slow coal transportation. Teck now expects coal sales in the first quarter to be between 4.6 million and 4.9 million tonnes, down from prior guidance of between five million and 5.5 million tonnes. Offsetting this bad news, however, was word that the company has reached a new five-year agreement with striking employees at its Elkview coking coal mine in British Colombia. Teck ended the week up C$2.44 at C$53.37.

Elsewhere, White Tiger Gold went shopping and elected to buy Century Mining in an all-stock deal valued at C$743 million. White Tiger, which has assets around Russia, is interested in Century’s flagship Lamaque gold project in Quebec, as well as its San Juan project in Peru. The combined company is expected to produce about 115,000 ounces of gold a year. White Tiger ended the week down C$0.85 at C$3.70, while Century dropped C$0.04 to close at C$0.54.

In copper, Taseko Mines tabled an operating profit of C$125.5 million and earnings of C$148.6 million, or C$0.80 per share, in the fourth quarter of 2010. Taseko ended the week up C$0.28 at C$5.88.

Any drilling news?

VMS Ventures tagged 50.08 metres grading 6.85% copper at its Reed Lake property in Manitoba. VMS ended the week up C$0.08 at C$0.79.

And shares of Gold Canyon surged C$1.00 to close at C$3.36 thanks to more positive drill results from its Springpole project in Ontario. The latest batch included 100.5 metres running 7.23 grams gold per tonne.

Richfield Ventures also continued to attract investor interest by returning 145 metres grading 2.7 grams gold per tonne at its Blackwater project in British Columbia. Richfield closed at C$6.64 for a C$0.64 gain.

Also attracting interest was Ivanhoe Mines, which announced a new shallow copper, molybdenum and gold zone some 10 kilometers from its famous Oyu Tolgoi copper-gold project in Mongolia. Ivanhoe ended the week up C$1.20 at C$25.84.

Finally, Prodigy Gold cut 261 metres grading 1.13 grams gold per tonne at its Magino Mine property in Ontario. Prodigy closed at C$0.36 for a C$0.05 gain.

All eyes will be on Japan and the country’s attempts to stem the radiation coming out of its nuclear reactors. Any fallout from the Greystar news in Colombia will also be watched eagerly by traders. We will see what next week brings us.

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