SILVER STOCKS NEWS – Silver stocks surged Monday, with the Global X Silver Miners ETF (SIL) advancing $0.92, or 4.3%, to $22.45 per share. The rally in silver stocks was fueled by a rebound in COMEX silver futures, which jumped $0.58, or 1.9%, to $31.77 per ounce in morning trading.
Silver stocks were lifted by broad-based gains in the equity and commodity markets following this past weekend’s meeting of European policymakers. Although German Chancellor Angela Merkel and French President Nicolas Sarkozy have yet to announce any concrete plans to more effectively combat the sovereign debt crisis, they reported on Sunday that “a broad agreement is taking shape.”
In spite of today’s strength in silver stocks, the sector as a whole has continued to lag the white metal in 2011. On a year-to-date basis, the SIL is now lower by 17.3% – versus a 2.6% gain for silver bullion.
The vast majority of large-cap silver stocks – which comprise a considerable portion of the SIL – have not provided investors with leverage to the silver price this year. Two prominent examples of this include Pan American Silver (PAAS) and Silver Wheaton (SLW). PAAS has tumbled 30.6% in 2011, while SLW has fallen 20.9%.
While many small- and mid-cap silver stocks have also fared rather poorly this year, one company that has bucked the trend of lower silver stocks is Fortuna Silver Mines (FVI.TSX). Shares of FVI.TSX have climbed 22.2% on a year-to-date basis as the Canadian-based silver producer has made substantial progress at its mines in Peru and Mexico.
This morning Fortuna reported third quarter production of 673,137 ounces, a 42% increase over the third quarter of 2010. The Company noted that with the commencement of commercial operations in September at its San Jose mine in Mexico, Fortuna is on schedule to generate sustained quarterly production growth to the planned annual rate of 4.9 million ounces of silver and 26,000 ounces of gold by Q4 2013.
In morning trading, FVI.TSX rallied as much as 6.2% to C$5.84 per share. Other notable silver stocks moving higher on Monday included SIL components Coeur d’Alene Mines (CDE), Hecla Mining (HL), and Silver Standard Resources (SSRI) – which advanced 6.0%, 3.1%, and 5.4%, respectively.
Fortuna Silver’s Production Climbs 42%
The Company is also conducting an optimization study at the Caylloma mine. This study is based on the 4 million tonnes of reserves, and the results – expected in Q1 2012 – could lead to production expansions beyond the current 1,270 tonnes per day (tpd)." Full Fortuna Silver Press Release
- Silver production of 673,137 ounces; 42% increase over Q3 2010.
- Gold production of 1,623 ounces; 157% increase over Q3 2010.
- Fortuna Silver Mines affirmed its full-year 2011 guidance of 2.4 million ounces of silver and 7,530 ounces of gold.
