Wednesday, August 30, 2006, 4:15 PM ET (Thomson Financial Corporate
Services): Bay Street demonstrated the importance it puts on crude prices
again today, as revised GDP figures that lifted markets south of the
border, good news from AnorMed and Bombardier, and a rise in gold failed to
ignite the TSX. Markets on both sides of the border were flat ahead of the
U.S. holiday weekend. Sears Holding is continuing its quest to acquire
Sears Canada and BCE is hoping investors will want to acquire shares in
Telesat.
* The S&P/TSX Stock Exchange Composite Index edged up 7.88 points, or
0.07%.
* Topping earnings headlines, Bombardier released its second-quarter
profit, which fell to C$0.03 per share from C$0.06 per share last year,
meeting expectations. The transportation mammoth says the market for its
regional jets and rail services is "difficult," especially in Europe, but
also noted that last year's results included a large one-time boost and
that business jet construction is now picking up. Bombardier rallied on the
day.
* Sears Holding is extending its C$18 per share offer for Sears Canada
until Sept. 29th. The deal has been complicated by an Ontario Securities
Commission ruling which insisted the American retailer had to change key
parts of the offer, calling it "coercive and abusive of the minority
shareholders." Sears Holding is appealing.
* BCE is proceeding with an IPO of Telesat Canada, after several sales
deals fell through this spring. Telesat is the world's fifth-largest
commercial satellite operator, and the IPO will be valued at C$1 billion.
* AnorMed shares roared into a high double-digit increase after the
biopharmaceutical company rejected a US$8.55 per share takeover offer from
Genzyme. Investors were delighted when the company said it would entertain
other offers.
* Gold recovered and, for the first time in three sessions, leapt US$7
to close at US$626.10.
* Oil inventories rose last week as imports surged to their second
highest level on record; instead of the 1.5 million barrel decrease
analysts had been expecting, commercial crude inventories rose by 2.4
million barrels, to 332.8 million total. Distillates and gasoline also
rose. The price of crude on the markets accordingly fell, at one point
reaching a five-month low near US$69, before settling at US$70.03, up
US$0.32. Tomorrow's deadline for Iran's reply to the UN, however, reminded
the markets that geopolitical factors beyond its control also loom large.
* Turning to the economy, Canada's account surplus shrank by C$4.0
billion in the second quarter, according to Statistics Canada, resulting in
a final figure of C$4.2 billion. Exports continued to decline while imports
rebounded; it was the second consecutive decrease in the surplus.
* The U.S. GDP was revised by the Commerce Dept. for the second quarter
from 2.5% to 2.9%, missing predictions of 3%. Still, U.S. markets rose on
the news, which suggested slowing growth and lessened inflation fears.
-- 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
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SOURCE Thomson Financial Corporate Group
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