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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: Kerm Yerman who wrote (7668)	12/2/1997 11:36:00 AM
From: Kerm Yerman	Read Replies (17) \| Respond to of 15196

MARKET ACTIVITY/TRADING NOTES FOR DAY ENDING MONDAY, DECEMBER 1, 1997 (3) The U.S. market for foreign crudes with January delivery dates remained unfreindly, with Nigerian cargo prices considered too high, the "arb""for North Sea barrels very tight and generally ample supply from short-haul Latin producers. Traders said Nigerian Qua Iboe and Forcados cargoes for arrival early January were on offer at $1.80 over dated Brent on a delivered basis. "That's cheap by fob standards, but expensive for the U.S.," one foreign trader said. The extremely narrow West Texas Intermediate/North Sea Brent arbitrage makes WTI-related foreign crudes more attractive than West African grades whose prices are tied to Brent. The WTI/Brent spread for January delivery settled at 49 cents on Monday, while the arb is considered to be open only well above $1.00. Offers for the last Cusiana cargo in the December program were at minus 45 cents, weaker than last week's 35 cents discount. In addition to Ecopetrol's three December Cusiana cargoes, an equity producer sold another cargo last week, traders said. The additional cargo traded at 56 cents under January/WTI, traders said, while Ecopetrol's cargoes sold at minus 55 cents, minus 50 cents and minus 45 cents, they said. On the sour side, the future of the "oil-for-food""deal under which Iraq sells its crude for humanitarian aid remained undecided, though it may be resolved by the end of the week when the current leg runs out. The Security Council is expected to renew the deal for another six months at $2 billion for the period, though leaving open its option to increase the deal during that period. Baghdad blew hot and cold in the last few days over whether it would accept such terms and it was unclear if there would be any delays in starting a third round. U.S. lifters of Iraqi Basrah Light crude said they had not begun discussions with the Iraqi state oil marketing organisation (SOMO) about sales under the next round of the oil-for-food deal with the United Nations. Traders said SOMO was waiting for a final agreement before it would discuss the details of new contracts. "They're playing it by the book. They won't talk about prices, dates or volumes yet," said one buyer of Iraqi crude. Traders said because of the uncertainty they had not yet chartered ships to load crude in the next round. "SOMO could get oil flowing again within a few days of a deal, but shipping is fairly abudant at the moment and we're not going to do anything until the picture is clear," said one. Venezuela's extra-heavy, sour crude BCF-17 was said to be trading at a discount of $4.50 under U.S. benchmark WTI, and traders said the Venezuelan grade was competitive to Mexican Maya at these levels, despite the fact that Pemex cut December prices for its heavy crude. MARKET ACTIVITY The Toronto Stock Exchange Index jumped up 1.7% or 111.09 to 6623.87. In comparison, the Toronto Oil & Gas Composite leaped in the opposite direction, down 1.8% or 117.77 to 6507.83. Of the sub-components, the Integrated Oils lost 2.7% or 232.08 to 8406.45. The Oil & Gas Producers fell 1.3% or 75.96 to 5817.55 and the Oil & Gas Services was down 2.7% or 86.94 to 3098.61. Orbit Oil & Gas, Gulf Canada Resources, Anderson Exploration, Poco Petroleums, Petro-Canada, Norcen Energy Resources, Elk Point Resources, Talisman Energy, Rio Alto Exploration, Canadian Natural Resources, Rigel Energy and Imperial Oil were among the top 50 most active issues on the TSE. Not one oil was listed among the top 50 net gainers. K2 Energy was up 10.4% to $1.49, Bellator Exploration 10.0% to $2.75, Search Energy 10.0% to $1.10 and Richland Petroleum 9.2% to $4.75. On the downside, Chieftain International fell $1.50 to $31.25, Amber Energy $1.45 to $19.00, Suncor Energy $1.25 to $45.70, Imperial Oil $1.20 to $82.50, Talisman Energy $1.10 to $40.95, Petro-Canada $0.90 to $24.50, Canadian Natural Resources $0.80 to $30.75, Denbury Resources $0.80 to $29.45,Pinnacle Resources $0.80 to $19.05, Northrock Resources $0.75 to $21.75, Pacalta Resources $0.65 to $15.75, Baytex Energy $0.60 to $15.35, Remington Energy $0.55 to $22.75, Shell Canada A $0.55 to $24.75 and Seven Seas Petroleum $0.50 to $17.50. Percentage losers included Cavell Energy 14.6% to $1.11, Black Sea Energy 7.7% to $2.40, Amber Energy 7.1% to $19.00, Ram Petroleum 7.1% to $1.05, Purcell Energy 6.7% to $1.40 and Newquest Energy 6.0% to $7.00. There were no new 52-week highs. Baytex Energy, Bow Valley Energy, Canadian Conquest Exploration, Canadian Natural Resources, Merit Energy, Northstar Energy and Palliser Energy reached new 52-week lows. In the oil & gas services group, as well as those companies with close ties to the industry, none were listed among the most active traded issues. Artisan Corp. gained $1.50 to $14.00 and Shaw Industries $1.50 to $47.00. Artisan Corp rose 12.0% to $14.00. On the downside, Veritas Energy fell $5.00 to $55.00, Dreco Energy Services $1.25 to $44.00, Prudential Steel $1.25 to $13.30, Precision Drilling $1.05 to $35.80, Enerflex Systems $1.00 to $36.00 and Plains Energy Services $0.90 to $10.10. Percentage losers included Prudential Steel 8.6% to $13.30, Veritas Energy 8.3% to $55.00 and Plains Energy Services 8.2% to $10.10. ATCO I reached a new 52-week high. There were no new 52-week lows. Over on the Alberta Stock Exchange, ICE Drilling, Enerprise Developement, Trego Energy, Oxbow Exploration, Ascot Energy Services, Cirque Energy, Wild Horse Resources, Gopher Oil & Gas, Green Maple and Niko Resources were among the top 30 most active traded issues. Red Sea Oil gained $0.20 to $1.30, Jett Investment $0.19 to $1.25, AltaQuest Energy $0.17 to $2.25, Kensington .A $0.10 to $1.45, Prize Energy $0.10 to $0.55 and Scimitar Hydrocarbons $0.10 to $0.80. Percentage gainers included Moiibus Resources 22.6% to $0.38, Prize Energy 22.2% to $0.55, Red Sea Oil 18.2% to $1.30, Jett Investment 17.0% to $1.25, Para-Tech Energy 14.3% to $0.32, Scimitar Hydrocarbons 14.3% to $0.80, Gold Star Energy 10.0% to $0.55 and Oilexco 10.0% to $0.33. On the downsidde, Palmetto Resources fell $0.21 to $1.31, Belfast Petroleum $0.20 to $2.60, ICE Drilling $0.18 to $1.12, Derrick Energy $0.16 to $1.20, Farm Energy $0.14 to 0.46, Quest Energy $0.14 to $0.25, Blue Power Energy $0.12 to $0.43, CanBaikal Resources $0.12 to $1.80, NTI Resources $0.12 to $0.97, Suprex Energy $0.12 to $0.06, Alma Oil & Gas $0.10 to $0.65 and Telford Resources $0.10 to $1.10. Percentage losers included Quest Energy 35.9% to $0.25, Farm Energy 23.3% to $0.46, Blue Power Energy 21.8% to $0.43 and Crispin Energy 20.0% to $0.20 Granger Energy B and Trego Energy gained new 52-week highs. New 52-week lows included Burner Exploration, Canop Worldwide, Endeavour Resources, Epic Energy, Green Maple and Suprex Energy. Tuesday, December 2, 1997 Oil stocks take dip on OPEC decision The Financial Post Canada's battered oil and gas stocks took another beating yesterday as crude oil prices fell to their lowest level in five months following a decision by the Organization of Petroleum Exporting Countries to boost production by 10%. The Toronto Stock Exchange oil and gas index closed at 6507.83 on the day, its lowest close since May and down 117.77 from Friday's close. The subindex has been in a free fall since reaching 8031.57 Oct. 7, as the overheated industry struggles with higher costs, weakening commodity prices and expectations of softer demand from Asian countries. Crude for January delivery finished US49› a barrel lower, at US$18.66, on the New York Mercantile Exchange, the lowest close for nearest-term crude in five months. January gasoline followed crude, ending at US56.25› a gallon, US0.86› lower. January heating oil ended US1.58› a gallon lower, at US52.71›. OPEC, which produces 40% of the world's oil supply, decided on the weekend to increase its output quota to 27.5 million barrels a day in January. But despite yesterday's drops, industry analysts say it's too soon to predict a downturn for the Canadian sector. "Fundamentally the supply of oil hasn't changed," said Martin Molyneaux, managing director of institutional research at First Energy Capital Corp. in Calgary. "It's just that OPEC is giving themselves a higher quota, but they are already producing at that kind of level. So, I think oil prices have overreacted." His average oil price forecast for 1998 is unchanged at US$19.50 for west Texas intermediate. A silver lining for the Canadian sector is the low Canadian dollar. Its oil production, and 70% of natural gas production, is sold in US$s. The outlook for the supply/demand balance is good, backing prices in the US$21 to US$21.50 range next year, predicted Bob Hinckley, an analyst in New York with Merrill Lynch & Co. Because of buoyant economies, particularly in North America, "demand has been outstripping our expectations," Hinckley said. "So, I think the long-term view is quite positive because there is dwindling surplus production capacity, particularly within OPEC." If the low prices continue, it could cause the Canadian industry to review its spending plans for next year. In the shorter term, winter drilling is going ahead because producers have locked into commitments amid an industry-wide shortage of all types of services. Oil and gas stocks could fall even further if oil prices stay soft, Molyneaux said. "Generally at these levels, I don't think equities are reflecting US$18.50 oil prices. They're reflecting mid-US$19 range," Molyneaux said. Drillers continue month-long slide on OPEC news In the U.S., oilfield-service stocks continued their collective, month long decline on Monday, with OPEC's increased production quota providing yet another reason for investors to dump these issues. But analysts said the OPEC announcement and the United Nations secretary general's mendation that Iraq be allowed to sell more oil were not the real reasons for the group's decline. ''That's the excuse du jour,'' said Morgan Keegan analyst William McAtee. ''It's just a continued sell-off that's been going for a month and a half.'' Halliburton Co (NYSE:HAL) was off 2-3/16 at 51-3/4, Schlumberger Ltd [NYSE:SLB] the S&P oil drillers index (.SPOILW) was off 4.16 percent. As of November 5, the index had been up 77 percent for the year. Through Friday, it was up 53 percent. ''The stocks have all gotten pretty much hammered,'' said Schroder & Co analyst James Stone. ''People are looking to lock in gains by the end of the year.'' ''Today's really not that much different from the last couple of weeks,'' he added. Oil prices declined on Monday after the Organization of Petroleum Exporting Countries decided to increase its output by 10 percent and United Nations Secretary-General Kofi Annan recommended that Iraq be allowed to sell more of its oil. Pride International Inc (NYSE:PDE) was off 1-1/2 at 26-1/8, Diamond Offshore Drilling Inc (NYSE:DO) was off 4-1/16 at 45-13/16 and Oceaneering International Inc (NYSE:OII) was off 2-5/8 at 18. ''And yet the fundamentals on the individual companies haven't changed a bit,'' McAtee said. Drillers in Canada also suffered setbacks in share prices. Dreco Energy Services (TSE/DEY) closed down $1.25 to $44.00, Precision Drilling (TSE/PD)down $1.05 to $35.80 Enerflrex Systems (TSE/EFX)$1.00 to $36.00 and Plains Energy Services (TSE/PLA) $0.90 to $10.10. In closing this column today, I want to apologize for the lack of reporting over the past few days. I was on R&R (rest & relaxation) program and needed the time off.

To: Kerm Yerman who wrote (7668)	12/3/1997 9:18:00 AM
From: Kerm Yerman	Read Replies (1) \| Respond to of 15196

MARKET ACTIVITY/TRADING NOTES FOR DAY ENDING TUESDAY, DECEMBER 2, 1997 (1) Wednesday, December 3, 1997 Stock Markets Bay Street plays catch-up Bay Street climbed for a third straight day led by a strong showing in the oilpatch and financial services stocks. Wall Street edged higher but investors were jittery after a batch of earnings warnings By THE FINANCIAL POST The Toronto Stock Exchange 300 composite index jumped 43.59 points, or 0.7%, to 6667.46. Volume on the TSE was 130.1 million shares, compared with Monday's volume of 100.3 million shares. "Canada had to catch up with New York's rise over the past couple of days," said Jim Doak, a fund manager at Enterprise Capital Management. Earlier in the day the index gained more than 1%, but strength waned after domestic investors slackened their buying of heavily weighted banks. All but two of Toronto's 14 sub-sectors gained, led by media, consumer products, banks and oils. Transportation and base metals were the softer groups. Toronto's financial services subindex staged a recovery after being beaten up last week, said John Ing, president of Maison Placements Canada Inc. The TSE's banking group gained 1.3% as Royal Bank of Canada (RY/TSE) rose $1.50 to $80.35, ahead of its fourth-quarter earnings report due to be released today. Toronto Dominion Bank (TD/TSE) rose 65› to $53.40 while Canadian Imperial Bank of Commerce (CM/TSE) added 5› to $44.70 in brisk dealings. The oil and gas subindex also helped the TSE 300's advance, gaining 1.5% after being the laggard in Monday's session. The sector recovered after falling in response to an OPEC decision to increase its production ceiling by 10%. In the group, Suncor Energy Inc. (SU/TSE) climbed $1.55 to $47.25. Individual issues also captured investor interest, including miner Noranda Inc. (NOR/TSE), which rose 50› to $25. The company is selling its energy and forestry businesses. The other major Canadian markets closed mixed. The Montreal Exchange market portfolio rose 12.29 points, or 0.4%, to 3386.52. The Vancouver Stock Exchange composite index fell 5.64 points, or 0.9%, to 631.35. In New York, the Dow Jones industrial average rose 5.72 points to 8018.83 following Monday's 190-point gain. Volume on the New York Stock Exchange was 580.8 million shares, compared with Monday's volume of 596.2 million shares. The Nasdaq composite index, laced with tech stocks, fell 24.35 points, or 1.5%, to 1606.37. The Standard & Poor's 500 composite index dropped 3.09 points, or 0.3%, to 971.69. "The market is generally pretty nervous as we approach our old highs, especially after [Monday's] strong gains," said Gary Anderson, a money manager at Anderson & Loe. "People are buying into defensive and consumer issues. Technology is a very aggressive area and it can be quite volatile." Financial markets were on pins and needles ahead of a speech on global finance by U.S. Federal Reserve chairman Alan Greenspan. Greenspan was scheduled to speak to the Economic Club of New York last night. Almost one year ago, on Dec. 5, 1996, the Fed chief rattled global stock markets with his warnings of "irrational exuberance." Technology stocks were led lower after disk drive maker Western Digital Corp. and networking equipment maker Cabletron Systems Inc. warned that earnings in the upcoming quarter will come in lower than expected. Cabletron (CS/NYSE) lost US$7 1/2 to US$15 11/16 after it said its earnings would fall short of expectations for the third straight quarter. Western Digital's (WDC/NYSE) warning of a second quarterly earnings shortfall projection in less than a month knocked the stock off 8%, down US$1 3/4 to US$19 3/8, and also dragged other data storage stocks lower. The major overseas markets closed mixed. London: British shares closed higher. The FT-SE 100 index rose 55.8 points, or 1.1%, to 4977.6. Frankfurt: German shares, which had started the day well, finished slightly ahead after the previous day's rally. The Dax index climbed 4.91 points to 4072.96. Tokyo: Japanese stocks ended the session down slightly, as upward momentum petered out after four consecutive sessions of gains. The 225-share Nikkei average fell 97.3 points, or 0.6%, to 16,910.29. Hong Kong: Stocks finished sharply higher, propelled by the strong overnight gain on Wall Street and steady local interest rates. The Hang Seng index rose 465.47 points, or 4.3%, to 11,216.35. Sydney: Australian shares ended marginally higher, despite Monday's sharp Wall Street rally. The all ordinaries index gained 11.4 points, or 0.5%, to 2524.8. Asian, European Markets Down A Bit Wednesday Morning In Hong Kong the Hang Seng Index, the stock market's key indicator of blue chips, fell 8.77 points, or 0.1 per cent to 11,207.58 on Wednesday. In Tokyo the 225-share Nikkei Stock Average at the Tokyo Stock Exchange fell 324.78 points, or 1.92 per cent, closing at 16,585.51. In London at midday on the London Stock Exchange, the Financial Times 100-share index was down 5.1 points to 4,972.5. The U.S. dollar fell against other major currencies in early European trading Wednesday. Gold prices also were down. In Toronto, the Canadian dollar closed at 70.46 cents US on Tuesday, up 0.20 cent. The U.S. dollar stood at $1.4193 Cdn, down 0.40 cent. Also in London, the dollar is trading at $70.49 cents US - up 0.03 cent from Tuesday's close. London dealers fixed a recommended gold price of $291.10 US per ounce at midmorning, down from the closing price of $294.30 bid Tuesday. In Zurich, the bid price was $291.80 US, down from $294.50 late Tuesday. Earlier in Hong Kong, gold fell $1.90 US to close at $291.15. Silver traded in London at $5.24 US a troy ounce, down from $5.33 late Tuesday. HOT STOCKS Shot In The Arm For Fertilizer Stocks. Potash Corp. of Saskatchewan Inc. (POT/TSE), up $3.75 to $118.25, on volume of 108,550 shares and (POT/NYSE), up US$3 1/4 to US$83 3/8, on volume of 307,600 shares. Agrium Inc. (AGU/TSE), up 40› to $15, on volume of 421,508 shares. IMC Global Inc. (IGL/NYSE), up US$2 to US$3215 1/816, on volume of 1.1 million shares. A big export order and a lower tax rate are helping the fertilizer stocks, Dow Jones reported. Canpotex, a Saskatchewan potash export agency, signed a deal to export 700,¬000 tonnes of potash to China by the end of February. According to a report by Salomon Smith Barney analyst Robert Koort, Potash supplies about 58% of Canpotex sales, IMC about 35% and Agrium about 8%. More importantly, the new orders will be shipped at higher prices. Higher orders and a better tax position will help Potash boost fourth-quarter earnings by about US$10 million, Merrill Lynch & Co. analyst Doug Groh said in a report. That lower than expected tax rate is the real excitement, said Don Carson, an analyst with J.P. Morgan Securities Inc. "The better tax rate will increase fourth-quarter earnings by about US20› a share," Carson said. "By comparison, the US5› to US10› increase [from the Canpotex contract] is not as significant." Vector Intermediaries Inc. (VTE/ASE), down $1.20 to $1.80, on volume of 113,650 shares. Late Friday, the insurance brokerage operator reported a bigger loss, several resignations, a new president and a pause for breath. After buying 15 property and casualty brokerages this year, Vector said it has stopped its acquisition program to concentrate on integrating the businesses and cutting costs. For the three months ended Sept. 30, the company reported a loss of $2.3 million (34› a share) on revenue of $3.9 million, compared with profit of almost $30,000 (1›) on revenue of $942,000 a year earlier. Company president Philip Bookalam resigned and moved to the newly created job of non-executive vice-chairman. Judith Bookalam resigned as an officer and director. Gordon Campbell is now president. The stock closed at $4.75 Friday before the news was released. On Monday it slipped $1.75 on volume of 17,100 shares. Boardwalk Equities Inc. (BEI/TSE), down 75› to $16.75, on volume of 220,580 shares. On Nov. 21 the real estate company said it had signed a $60.8-million deal to buy 1,324 residential units in buildings in four Western Canadian cities. The stock was at $18.75 when the news was released. Talisman Energy Inc. (TLM/TSE), up 75› to $41.70, on volume of 538,328 shares. The energy company has arranged an asset exchange of North Sea locations to increase net 1998 production by 5,000 barrels a day. The deal with Arco British Ltd., effective Nov. 1, gives Talisman Arco's interests in the producing Blenheim field, increasing its stake to 68.2% from 36.1%. Talisman also acquires some similar, low-risk exploration prospects, and a 25% interest in an area adjacent to its gas discovery in the Outer Moray Firth. Arco receives Talisman's interests encompassing the Arco-operated Waveney field, and cash. Mosaic Group Inc. (MGX/TSE), unchanged at $2.60, on volume of 1.5 million shares. Volume was heavy as stockbroker Marleau Lemire Securities Inc. crossed blocks of 1.2 million and 300,000 shares at $2.52 each. The blocks represent about 8% of the float. Ben Kaak, chief financial officer, said insiders sold to what he believes is an institution. If that is so, it will make the stock more liquid. Alberta Oil & Gas Petroleum Corp. (AOC/ASE), $1.50, on volume of 5,500 shares. The junior consolidated its stock one for 10 and changed its name from Alberta Oil & Gas Ltd. Vid‚otron shares (VDO/ME) closed up 35› yesterday at $11.50. Moffat (MOF/TSE) closed up 25› at $15.70. Moffat Communications Ltd. will more than double its size and expand significantly into Alberta following a $295-million deal concluded early yesterday with Groupe Vid‚otron lt‚e. The Winnipeg-based broadcaster and cable company, controlled by the Moffat family, beat out several other bidders, including Shaw Communications Inc., which owns cable systems adjoining those of Moffat in Winnipeg and Edmonton, Vid‚otron said. "This [deal] grows our company by 65% - it's quite significant," Bill Davis, Moffat's vice-president of finance, said after working out the final details with lawyers. For Vid‚otron, which hired Toronto Dominion Securities Inc. to seek bidders a few months ago, the deal with Moffat provides cash that "will be part of our Quebec war chest," said spokeswoman Sylvia Morin. She said Vid‚otron "is looking at $200 million to $210 million as an accounting gain." The Quebec-based giant will still have about 1.5 million subscribers after it sells the Alberta systems. TLC shares (LZR/TSE) closed at $11.25, down 20›. BeaconEye (BEY/TSE) closed at 70›, down 25›. Struggling BeaconEye Inc. has rejected an offer from competitor TLC The Laser Centre Inc. to buy all its laser vision correction centres. TLC recently made an offer to buy 11 BeaconEye centres across North America, including two in Toronto. Corel Corp shares (COS/TSE) closed down 6› at $3.20 yesterday. The stock, which recently hit a 52-week low of $3.13, is now trading at less than half the company's annual sales. Analysts forecast shares will be hammered by end-of-year selling and rumors of a dismal fourth quarter, analysts predict. The software company's final quarter, which ended Nov. 30, is expected to be at least as bad as Corel warned when it reported terrible third-quarter results in September. Corel will release fourth-quarter results on Jan. 14. "Everyone I've spoken to says they're going to be just awful," said one analyst, speaking on condition of anonymity. "No oneis hearing that there is a pleasant surprise coming." Add to that tax-loss selling normally seen during the month of December, and this promises to be a bleak time for the troubled Corel. Most analysts have downgraded their opinions of the stock since Corel reported in August its distribution channels were clogged with unsold software.