GOLD STOCKS NEWS - Gold stocks rallied as the gold price rallied nearly 2% - its best day in a month. With this morning’s advance in the gold stocks, many of the world’s leading gold stocks recovered the majority of their declines from last week. Barrick Gold (ABX), the world’s largest gold producer, climbed 2.8% to $40.10. Goldcorp (GG), one of the most widely held gold stocks, gained 2.6% to $40.09 in tandem with a rising gold price and stronger global stock markets.
Strength in the gold stocks came amid another day of several news items in the gold sector. Alamos Gold (AGI.TSX) released its fourth quarter and full year 2009 financial and operating results. The Canadian-based gold producer reported quarterly gold production of 48,000 ounces and record quarterly earnings of $0.18 per share. For the year, the company produced 178,500 ounces of gold, an 18% increase over 2008 and the third consecutive year of gold production growth. Alamos Gold also released its 2010 gold production forecast, which consisted of 160,000 to 175,000 ounces from its Mulatos Mine in Mexico at a total cash cost of $338 per ounce. Shares of AGI.TSX - which have displayed considerable leverage to the gold price - surged C$0.69, or 5.0%, to C$14.45 in morning trading.
Minefinders (MFN) reported that Standard & Poor’s Canadian Index Operations has decided to add the Canadian-based precious metals miner to the S&P/TSX Global Gold Index effective at the market open on March 22. The S&P/TSX Global Gold Index is the most closely followed collection of gold stocks in Canada. Shares of MFN rallied alongside the gold price and gold stocks sector, gaining $0.21, or 2.1%, to $10.36.
Canadian-based Inmet Mining (IMN.TSX) reported that LS-Nikko - through Korea Panama Mining Corporation, its wholly owned subsidiary - has decided to retain its option to acquire an equity interest at the current 20% level in Minera Panama, S.A. The entity, Minera Panama, is the owner of the Cobre Panama project, a copper-gold development property in Panama. Inmet is a global mining company that produces copper, zinc and gold, with interests in five mining operations and a 100% interest in Cobre Panama. Shares of IMN.TSX were lower this morning by C$0.39, or 0.7%, to C$59.11.
In terms of research analyst coverage of gold stocks, Scotia Capital initiated shares of SEMAFO (SMF.TSX) with a “Sector Outperform” rating and a one-year target price of C$6.00 - a 17.0% premium to yesterday’s closing price of C$5.13 per share. The report stated that SEMAFO has “transformed into a meaningful player in the region of West Africa with the successful commissioning, ramp-up, and exploration program at its flagship asset, Mana, in Burkina Faso.” It went on to cite Mana as a “significant resource growth opportunity.” Shares of SMF.TSX were higher by C$0.08, or 1.6%, at C$5.21 in morning trading.
