Wednesday, August 9, 2006, 4:15 PM EST (Thomson Financial Corporate
Services): After absorbing the news from the Fed, the TSX climbed up above
12,000 and remained there until close, as gold prices lifted the metals
sector. While construction's Aecon posted a loss, housing starts edged up.
Finally, Falconbridge may at last have found its buyer, while Sears Canada
has to wait a while longer.
* The S&P/TSX Stock Exchange Composite Index edged up 9.97 points, or
0.08%.
* In earnings news, construction company Aecon posted a loss in the
second quarter of C$1 million, or C$0.03 per share, compared to a profit of
C$1.7 million, or C$0.05 per share last year; however, as the company
noted, last year it had a C$3.4 million tax gain.
* As its acquisition story began to draw to a long-awaited close, the
Board of Directors of Falconbridge recommended the Xstrata deal to its
shareholders. The C$63.25 per share offer expires Aug. 14th. The Board was
reassured when the European mining giant declared it would keep Xstrata
Nickel offices in Toronto.
* Apotex started to release its generic version of Plavix on Tuesday,
surprising the pharmaceutical world, as Bristol-Myers-Squibb stock slid. A
New York court refused to stop the sales yesterday, and Apotex proclaimed
that its belief that an upcoming patent infringement trial would validate
its right to sell the generic blood thinner.
* Husky Energy signed three petroleum contracts with China National
Offshore Oil to explore three new blocks in the South China Sea for oil and
natural gas. No figures were given, but Husky will finance the entire
production cost and China National will share in any profits.
* Another surprise was unveiled for the oil industry, already reeling
from the Prudhoe Bay pipeline problem-the U.S. Department of Energy
reported that weekly inventories of oil, gas, and distillates was much
lower than expected. Analysts had predicted 800,000 barrel drop in oil, and
instead saw a 1.1 million barrel drop; gasoline slid by 3.2 million barrels
instead of 1.1 million, and distillates by 200,000 instead of posting a
gain of 700,000.
* After hitting near-record highs when the markets opened, crude oil
settled down after BP spokesman Ned Chapman reported that the North Slope
fields in Prudhoe Bay may not need to be shut down entirely after Monday's
pipeline leak. Also, Saudi Arabia and Mexico stepped in and promised to
help make up the shortfall. After nearly hitting US$78, oil closed at
US$76.35, up only four cents.
* Gold closed at US$662, up US$4.70, as the U.S. dollar weakened and
gold began to recover its safe-haven status.
* Sears Holding Corp. received disappointing news from the Ontario
Securities Commission, which favored dissident hedge funds, as its C$18 per
share offer to finish buying up its Canadian spinoff, Sears Canada, was
postponed. The OSC maintains that Sears Holdings did not fully comply with
disclosure agreements, and that therefore many of the shares it had already
signed up are now out of the counting for shares needed to complete the
transaction.
* Topping U.S. earnings headlines, tech bellwether Cisco surged as it
posted better-than-expected fourth-quarter results and issued an
optimistic. Entertainment mogul Disney also reported strong earnings over
all its divisions.
* On the economic front, oe hundred houses made the difference, as the
CMHC reported that housing starts rose to 236,500 in July from 236,400
units in June. The slim margin was, however, well above analysts' forecasts
of 225,000 units. Also, building permits dipped by 1.4% in June, after a
7.7% leap in May, with a total value of C$5.35 billion.
* Meanwhile, a minor U.S. statistic was also released: wholesale
inventories rose a larger-than-expected 0.8% in June, mostly due to higher
sales of lumber, machinery, and metals.
-- Carolyn.Crapo@contractor.Thomson.com; Thomson Financial Corporate
Services
This is Thomson Financial Corporate Services Canadian Commentary, which
is updated twice daily. The information herein is believed to be true and
accurate, we take no responsibility for inaccurate information and reserve
the right to update our reports. For more financial information at your
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SOURCE Thomson Financial Corporate Group
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