Thursday, September 7, 2006, 4:15 PMEST(Thomson Financial Corporate
Services): Resource stocks continued to drag down the TSX as oil hit a
five- month low, and the loonie edged downwards. Meanwhile, the Bloc
Quebecois rode to the rescue of the Tories in support of the softwood
lumber deal. In corporate news, BlackBerry aficionados have a new toy --
although Canadians will have to wait a bit longer for it.
The S&P/TSX Stock Exchange Composite Index dropped 104.70 points, or
0.87%.
Research in Motion unveiled its new BlackBerry Pearl to the press,
pending its American release on September 12. It will be available on the
Canadian market in October. The new handset combines a digital camera,
music player, and expandable memory slot as well as the classic BlackBerry
functions, in a smaller, lighter package with only fourteen buttons.
MDSreported a net profit of C$21 million, or C$0.14 per share, in the
third quarter, up from C$19 million, or C$0.14 per share, last year. Still,
the most recent result fell below the average analyst expectation. The
biopharmaceutical giant saw revenue up 2% to C$377 million. It also
announced a deal to sell its diagnostics division to the Ontario Municipal
Employees Retirement Board for nearly C$900 million, in the final step of a
restructuring that has seen it sell off various divisions.
The Bloc Quebecois came out in favour of the softwood lumber deal, so
the Tory government should not fall in a vote of confidence this autumn.
The Liberals and NDP, which have vowed to block the deal, have 131 seats in
Parliament, but the BQ has 50, which will combine with the Conservatives'
125 to let the agreement through.
Turning to the industrial sector, Bombardier has sold ten turboprop
planes to Denver's Frontier Airlines, netting US$256.8 million.
Furthermore, Frontier has the option to double the order in the future for
more of Bombardier's Q400 aircraft.
Elsewhere, Transat A.T. posted a third-quarter profit of C$0.12 a
share, up sharply from C$0.02 a share a year ago. Revenues rose to C$611.1
million from last year's C$552.9 million.
Business-solutions provider Cognos is to cut 210 jobs, attributing the
move to the strength of the loonie. It now expects second-quarter earnings
to beat its earlier forecasts.
The U.S. Energy Department announced that oil inventories dropped by
2.2 million barrels, but a marked rise in distillates and gasoline,
combined with hurricane-free skies and no news from negotiations with Iran,
pressured crude. Oil prices closed down US$0.18 to end at US$67.32.
Gold also continued to cool from its perhaps-artificial heights of
August, losing US$16 to close at US$625.80.
U.S. economic statistics for today: Growth in the service sector
accelerated in August, according to the Institute for Supply Management;
the index of activity came in at 57.0, compared to 54.8 last month, handily
beating forecasts of 55.0. This is the 41st continuous month of expansion
in the sector. Also, job claims, according to the Labor Dept., dropped by
9,000 to 310,000 last week, the lowest level since late July.
-- Carolyn.Crapo@contractor.Thomson.com; Thomson Financial Corporate
Services
This is Thomson Financial Corporate Group's 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
fingertips, please visit http://www.irchannel.com.
SOURCE Thomson Financial Corporate Group
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