Canadian Shares Build On Yesterday's Gains

Canadian Shares Build On Yesterday's Gains

Tuesday, December 14, 2004, 10:15 AM EST (Thomson Financial Corporate Group): The Canadian market is continuing its advance this morning, bolstered by energy, technology, financial and healthcare stocks. Boosting industrial stocks, Bombardier is recovering from yesterday's news its CEO is leaving. Also, Canadian Pacific Railway is rallying on its upbeat news. In economic reports, the trade surplus and manufacturing shipments data for October disappointed economists. Investors are looking forward to the U.S. Federal Reserve's announcement on interest rates, due out at about 2:15 PM EST.

* The S&P/Toronto Stock Exchange Composite Index is advancing 34.93
points, or 0.39%.

* Yesterday, the S&P/Toronto Stock Exchange Composite Index surged 67.50
points, or 0.75%.

* On the economic front, the trade surplus unexpectedly fell to C$4.35
billion in October, after receding to a downwardly revised C$5.04 billion
in September. Elsewhere, manufacturing shipments declined 1.3% to C$49.77
billion in October from a revised C$50.42 billion in the prior month.
Economists were looking for a 0.3% rise in the October reading.

* South of the border, the trade gap widened to a record US$55.46 billion
in October from a revised US$50.93 billion the prior month. Also,
industrial production rose 0.3% in November, from a 0.6% advance in
October. Capacity use, meanwhile, inched up to 77.6% in November from
77.5% in the prior reading. Economists expected November's industrial
production figure, while capacity use was lower than expected.

* Brokerage research on Bombardier is mixed a day after that firm
announced the departure of its chief executive officer. National Bank
downgraded the firm and that brokerage, along with UBS, GMP and TD,
slashed their price targets on the stock. Meanwhile, Scotia and Orion
upgraded Bombardier.

* Separately, Canadian Pacific Railway is jumping higher, after its
announced last night that it received a favourable ruling on its final
offer arbitration for coal shipping rates from a mine of the Elk Valley
Coal Corp. Also, Scotia lifted its rating to "sector outperform" from
"sector perform," and raised its price target to C$45 from C$40.

* In technology reports, Mitec Telecom is falling sharply, after it posted
weaker second-quarter results that were negatively impacted by
restructuring and inventory write-off charges. The firm posted a loss of
C$0.07 a share, compared with last year's deficit of C$0.06 a share. Sales
plunged by more than 20% to C$16.3 million. Mitec also said it is in
discussions with two firms "with the intent of forging strategic
relationships or pursuing M&A activity."

* U.S. merger mania continues today. The New York Times is reporting that
software provider Symantec is in discussions to buy Veritas Software for
US$13 billion. Meanwhile, The Wall Street Journal stated that Vodafone
Group and wireless partner Verizon Communications have agreed to make a
joint bid for Sprint, which itself is in negotiations to be acquired by
Nextel Communications.

* Gold shares are in the red this morning, while the U.S. dollar is
slightly lower against the euro ahead of the Fed's interest rate decision.
In corporate reports, Barrick Gold is considering buying up to 50% of
Russian gold mine Taseyevskoye mine, which is operated by Britain's
Highland Gold Mining. The news comes from a senior Highland official who
said Barrick will make its final decision by the end of the week. In
research, JP Morgan upgraded Teck Cominco to "overweight" from "neutral."

* Oil prices are on the rise this morning, aided by cooler weather in the
U.S. that is sparking heating oil buying.

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 -- Dec. 14


Source: Thomson Financial Corporate Group

Web site: http://www.thomsonfinancial.com/
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