Monday, June 26, 2006, 4:15 PM EST (Thomson Financial Corporate
Services): The mining sector led the TSX to post triple-digit gains, as the
markets opened to the news of U.S. copper giant Phelps Dodge's acquisition
of Canadian miners Inco and Falconbridge, a deal worth about US $40
billion. Meanwhile, U.S. shares also reacted positively to M&A news and an
upbeat housing data report.
* The S&P/TSX Stock Exchange Composite Index jumped 123.18 points, or
1.10%.
* US copper giant Phelps Dodge announced an agreement worth about US
$40 billion for two Canadian mining companies, Inco and Falconbridge. If
the deal is completed, it would create the largest mining firm based in
North America. Phelps tumbled on the day, as some investors believe it paid
too high a premium for both firms. Inco and Falconbridge rallied. The newly
consolidated Phelps Dodge Inco would be based in Phoenix, AZ.
* Suncor Energy (U.S.A.), a unit of Suncor Energy, completed a US $445
million upgrade to its refinery in Commerce City, CO, that will enable it
to produce low-sulphur diesel in accordance with new regulations.
* Remarks by the energy minister of Iran and news of the closing of a
key Louisiana waterway made the crude oil markets jittery, leading oil
prices to increase US $0.93 and a finish at US $71.80 per barrel, the
highest since June 9th.
* Also, Talisman Energy is temporarily halting oil production in
Algeria as it waits for several high-pressure and compressor motors to come
back from France, where they were shipped for repairs in May after being
damaged by a power surge. Operations should be restored for the third
quarter.
* Gold dropped slightly by US $0.30 to close at US $587.70 per ounce.
Analysts of the yellow metal believe that the market will be fairly flat
this week, as the futures market waits for the results of the Federal Open
Market Committee meeting on Thursday.
* In major healthcare sector news, medical technology developer Vasogen
dropped, after it announced its Phase III clinical trial for the Celacade
anti-inflammatory cardiac device yielded mixed results. The study didn't
reach the primary endpoint of significantly reducing the risk of death and
cardiovascular hospitalization in the total population. The company is
still analyzing the data and will present final results at a conference in
early September.
* Financial firms bounded higher. Insurance company Great-West Lifeco
acquired US $7.5 billion's worth of a package of midsize American pension
plans from Metropol Insurance, doubling its business in the 401K segment of
the market.
* Turning to U.S. economic reports, new-home sales exceeded
expectations, increasing 4.6% to a seasonally adjusted annual rate of 1.234
million last month. While still down 5.9% from May of 2005, the sales
topped analysts' predictions of a 4.0% decline from April.
-- Carolyn.Crapo@contractor.Thomson.com; Thomson Financial Corporate
Services
This is Thomson Financial Corporate Services Canadian Commentary, which
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SOURCE Thomson Financial Corporate Group
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