Canadian Mining Eye index sees sharp decline: EY

Sources available to offer insight on most recent mining and metals results

TORONTO, Dec. 14, 2015 /CNW/ - The Canadian Mining Eye index declined 17% during Q3 2015, which is a stark contrast to Q2 which saw a 4% gain. This latest drop was even more substantial than Q1 which saw just a 1% decline.

"Canadian mining equities continue to face downward pressure due to a fall in metal prices, weak macro-economic backdrop and weak Chinese demand," says Bruce Sprague, EY's Canadian Mining & Metals Leader. "But, with the US dollar strengthening against the Canadian dollar, Canadian miners are expected to benefit as commodities are traded in US dollars whereas production costs are incurred in Canadian dollars."

The Canadian Mining Eye: Q3 2015 highlights the significant concerns companies are dealing with that have contributed to a further plunge in Q3 2015 prices, including:

  • Gold was hit by lower imports by India, dropping 52% in September after a surge to meet festival demand in August.
  • With economic pressures in Europe, the US and China, the pressure on gold was strong.
  • In response to an economic slowdown in China, metals prices tumbled; copper was down 10%, nickel 13%, and zinc 16%.

The Canadian Mining Eye tracks Canadian mining sector performance of 100 TSX and TSXV mid-tier and junior companies with market capitalizations at the end, broadly falling between CDN$2.1b and CDN$160m.

About EY
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

SOURCE EY (Ernst & Young)

For further information: EY's Canadian Mining & Metals team is available to offer insight into the report's findings. To reach a spokesperson, or for more info, please contact: Leigh Kjekstad, leigh.kjekstad@ca.ey.com, 604 648 3807; Sasha Anopina, sasha.anopina@ca.ey.com, 416 943 2637; Julie Fournier, julie.fournier@ca.ey.com, 514 874 4308

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