Silver mining shares such as Fortuna Silver Mines Inc (NYSE:FSM) were in for another battering Friday as precious metals prices headed south in the face of rising bond yields and a resurgent US dollar.
Fortuna closed at $5.92, down 14.2%, with 3.41 million shares traded.
Technically, Friday’s high volume fall has taken the stock well below the 200-day moving average, and into bearish territory.
On the weekly chart, the stock has formed a highly bearish ‘head-and-shoulders’ pattern, and broken down through its up-slanting neckline.
Fortuna operates the Caylloma silver Mine in southern Peru, the San Jose silver-gold Mine in Mexico and the Lindero gold Project in Argentina.
Fortuna Silver Mines Inc (NYSE:FSM) roiled as precious metals roll over
Gold and silver, expected to go through the roof if Trump won the Presidency, did quite the opposite. Trump’s declarations of tax cuts and fiscal spending aimed at boosting the economy, a massive hike in bond yields, and a rapidly strengthening dollar combined to pull the rug out from under the feet of precious metals.
On Friday, other silver companies that faced a sell-off were First Majestic Silver (-9.07%), Fortuna Silver Mines (-14.20%) and Silver Standard Resources (-13.79%).
The silver price crashed Friday by 7.2% to $17.36. The gold price fell 3.3% to $1223.50.
Fortuna Silver Mines Inc (NYSE:FSM) during Q3 2016
During the third quarter, Fortuna reported sales of $65.2 million, versus $39.0 million in the year ago quarter.
It earned net income of $11.8 million and earnings per share of $0.09, compared to $2.6 million and $0.02, respectively, in the same quarter in 2015.
Operating cash grew to $28.5 million over the same period. As at the end of the quarter, cash and cash equivalents were $103.2 million.
It produced silver and gold of 2,089,506 and 14,111 ounces, respectively during the quarter.
Jorge A. Ganoza, President and CEO, commented, “Our strong results for the reporting period reflect the positive impact of our first quarter at the expanded processing capacity of 3,000 tpd at the San Jose Mine, higher silver and gold prices, and excellent cost execution at both operations. Our business generated a robust cash flow from operations of $28.5 million.”