Canadian Issues Move Higher Amid Surging Oil Prices

Canadian Issues Move Higher Amid Surging Oil Prices Tuesday, January 18, 2005, 10:15 AM EST (Thomson Financial Corporate Group): Toronto issues are securely in the black this morning, as higher oil prices bolster the energy sector. A U.S. cold snap and supply concerns are contributing to crude strength. Telecom and real estate stocks are also bounding higher. Domestic trading activity should pick up, as U.S. investors return from a long holiday weekend. Investors are looking forward to International Business Machine, Motorola and Yahoo's financial reports, due out after the close. * The S&P/Toronto Stock Exchange Composite Index is jumping 23.97 points, or 0.26%. * Yesterday, the S&P/Toronto Stock Exchange Composite Index advanced 6.68 points, or 0.07%. * Oil prices are surging this morning, above US$49 a barrel, as Northeast U.S. temperatures drop. Also, the International Energy Agency upwardly revised oil demand estimates for 2005 by 100,000 barrels a day. Turning to research, Smith Barney started coverage of Petro-Canada at "hold." Separately, gold shares are trending higher, despite strength in the greenback versus the euro. * In corporate resource reports, Alcan warned late this past Friday that its fourth-quarter operating earnings will land about 30% below its third-quarter result of US$0.74 a share. A weaker greenback was part of the reason for the warning, as Alcan reports in U.S. dollars, but pays certain expenses in Canadian dollars and other currencies. The company is bouncing back this morning, following a steep decline yesterday. * Nexen is preparing to spin off its chemical division as an income trust that could be valued up to C$800 million, according to Globe and Mail sources. Nexen will use the proceeds to finance its international expansion. * Telecom issues are rallying this morning. Telesystem International Wireless announced yesterday that its operating subsidiaries MobiFon S.A. and Oskar Mobil exceeded 6.7 million subscribers as of the end of December 2004. This morning, Orion raised Telesystem's price target to US$19 from US$16. * Technology stocks are near the unchanged mark. JDS Uniphase warned that its second-quarter loss will widen to US$0.02 a share from US$0.01 a share, due to a decline in revenue from a key customer. Revenue is now forecast to be about US$180 million, which is at the lower end of its prior guidance of flat to down 8% from first-quarter revenue of US$194.5 million. Separately, TD upgraded Sierra Wireless to "speculative buy" from "hold." * Last night, Nortel Networks' board declared a dividend on preferred shares. In personnel news, ATI Technologies appointed Patrick Crowley as chief financial officer and senior vice president for finance. Mr. Crowley replaces Terry Nickerson, who is retiring. * Within the industrial group, Bombardier Transportation received a US$45 million order to supply 16 low-floor trams to MVV OEG AG and MVV Verkehr AG, two German transportation firms. * In U.S. financial reports, Bank of America's fourth-quarter results rose to US$0.94 a share, matching the mean Street estimate. * Turning to economic releases, the leading indicator edged up 0.2% to 200.9 in December from 200.4 in November. Economists expected the index to rise 0.1% in the December reading. South of the border, the Empire State Manufacturing Index eased to 20.1 in January from 27.1 the prior month, well below the expected reading of 25.5. -- Linda.Shea@thomson.com; Thomson Financial Corporate Group -- 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/. If you have any questions please e-mail James Sang at james.sang@tfn.com or call 646.822.6233. For more information about Thomson Financial visit us on-line at http://www.thomsonfinancial.com/. PRNewswire -- Jan. 18 Source: Thomson Financial Corporate Group Web site: http://www.thomsonfinancial.com/ http://www.irchannel.com/ ------- Profile: International Entertainment