Saturday, October 25th5.8°C
23888
23004

Traders look to heavy slate of earnings news from Canadian miners this week

TORONTO - The focus of the Toronto stock market will again be on earnings news this week after positive corporate data pushed the TSX above the 14,000-mark last week for the first time in almost three years.

Traders will take in a slate of earnings from the resource sector with base metal miners HudBay Minerals (TSX:HBM), Lundin Mining (TSX:LUN) and Sherritt International (TSX:S) delivering results. Gold miners Iamgold (TSX:IMG) and Yamana Gold (TSX:YRI) also post results.

The gold sector was the major advancer last week, up about 12 per cent and contributing largely to a gain of almost two per cent on the TSX even as Goldcorp (TSX:G) missed earnings estimates and Barrick Gold (TSX:ABX) delivered a huge quarterly loss.

Both companies also slashed their estimated reserves in a response to lower gold prices that have prompted a reassessment of the worth of their assets. That second look at asset value comes at a time when investors have different expectations for precious metal miners.

"The focus now is more on profitability than it is on production growth," said Gareth Watson, vice-president, investment management and research, at Richardson GMP Ltd.

"During boom times, all you’re caring about is how can I get more production so I can benefit from these higher prices. But when you get into these crunch times, who cares if you have a mine where you can produce gold at $1400 an ounce — you’re not going to make money off of that."

Bullion has been trading at between US$1,200 and US$1,300 an ounce this year.

The gold sector was the leading loser on the TSX in 2013, plunging almost 50 per cent as gold prices tumbled amid low global inflation and the U.S. Federal Reserve started to cut back on its bond purchases.

Other analysts point out that a recent spate of merger and acquisition activity has sparked renewed interest in the sector.

Goldcorp has made a $2.6-billion hostile takeover bid for Osisko Mining Corp. (TSX:OSK). And HudBay Minerals (TSX:HBM) is making a hostile, all-stock offer to acquire all the common shares of Augusta Resources Corp. (TSX:AZC) that it doesn't already own in a deal that would be worth about $540 million.

"A lot of the strategists are saying, you know what, materials are looking very attractive," said John Stephenson, portfolio manager at First Asset Funds.

"I think this quarter marks, broadly speaking, a transition from don’t even talk to me about mining to, you know what, mining is looking kind of interesting here."

Other major corporations releasing earnings this week include grocer Loblaw (TSX:L) and home improvement chain Rona (TSX:RON).

On the economic front, the December reading on Canadian retail sales comes out Friday. Economists expect a decline of at least 0.4 per cent as ice storms and power outages closed some outlets and made travel difficult.

The January consumer price index also comes out Friday. The consensus calls for a 0.1 per cent increase over December, which would be the first increase in the past four months, boosted by higher natural gas and heating oil prices.

It is a shortened week with both Toronto and New York markets closed for holidays on Monday.

The Canadian Press


Read more Business News

23658


Recent Trending




Today's Market
S&P TSX14543.82+56.99
S&P CDNX805.45-3.15
DJIA16805.41127.51
Nasdaq4483.715+30.923
S&P 5001964.58+13.76
CDN Dollar0.8901-0.0003
Gold1231.20+2.10
Oil81.02-0.73
Lumber336.40+6.80
Natural Gas3.631+0.009

 
Okanagan Companies
Pacific Safety0.105-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.15-0.02
Cantex0.07+0.015
Anavex Life Sciences0.194-0.004
Metalex Ventures0.045+0.005
Russel Metals33.39+0.23
Copper Mountain Mining2.03-0.05
Colorado Resources0.145+0.005
ReliaBrand Inc0.012-0.001
Sunrise Resources Ltd0.05-0.01
Mission Ready Services0.445+0.035

 





FEATURED Property
20539686076 Highway 97 S
4 bedrooms 3 baths
$838,888
more details
image2image2image2
Click here to feature your property
Please wait... loading


What I learned in China

Photo: ContributedI will never be an expert on China. It is just too big, too complex and too old with layers of history and meaning that would take several lifetimes to unravel. As I said to my hosts...


We can get on together

I was in LA this week. I witnessed such crazy and unusual circumstances as I strolled along Hollywood Blvd and Sunset Blvd. A far cry from sleepy Peachland in the Okanagan! The strange thing was, I f...


Weakening global growth worries

The Big Picture Growth worries persist Worries about weakening global growth and its potential impact on the US economic recovery roiled markets around the globe this week. Europe continues to be the ...

_








Member of BC Press Council


22786