Gold Stocks Drag TSX Modestly Lower - Canadian Commentary

(RTTNews) - Gold stocks dragged Toronto’s main index lower on Friday as the precious metal backed off of record highs. The drop was the first in five sessions for the market.

The S&P/TSX Composite Index declined 47.59 points or 0.41% to move at 11,436.92.

Gold stocks lost 1.6% as the precious metal dropped $7.60 on the Comex. New Gold (NGD.TO) dropped 4.1%, Seagold (SEA.TO) fell 2.75% and Royal Gold (RGL.TO) slipped 2.4%.

Paramount Gold and Silver Corp. (PZG.TO) fell 5.6% after the company announced the pricing of its previously announced public offering of 16 million shares of its common stock at US$1.25 apiece.

Materials slipped 1%. Potash (POT.TO) dropped 3.6% after the stock was initiated at Sell by Dahlman Rose.

In corporate news, DragonWave (DWI.TO) soared more than 20% after the company reported second quarter net income of C$6.3 million or C$0.21 per share, compared to a loss of C$1.7 million or C$0.06 per share in the year-ago quarter.

MDS (MDS.TO) said it agreed to sell its Central Labs operation to Czura Thornton for around $8 million. The stock slipped 0.7%.

Newalta (NAL.TO) added 2.15%. The company announced that it has amended the terms of the credit facility by extending the maturity to October 12, 2011, and the principal amount has been reduced from $375 million to $350 million.

Dollarama (DOL.TO) jumped 5.6% on its first day of trading following its initial public offering of common stock. The company announced that it will offer 17.14 million common shares at C$17.50 per share.

On the economic front, Statistics Canada said employment was up 31,000 last month, driven by large full-time gains. The unemployment rate fell by 0.3 percentage points to 8.4%, the first monthly decline since the beginning of the labor market downturn in the fall of 2008.

There is no major economic news on Monday’s calendar. On Tuesday, traders will watch for the release of Canada’s new home price index at 8:30 a.m. ET.

For comments and feedback: contact editorial@rttnews.com

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