Bay Street Witnesses Slight Early-Morning Retreat

Bay Street Witnesses Slight Early-Morning Retreat

Friday, January 28, 2005, 10:15 AM EST: (Thomson Financial Corporate Group): Toronto stocks are posting modest declines, as lower oil prices pressure the energy sector. Healthcare, telecom and cyclical issues are also moderately lower. Also, Molson shareholders approved that firm's proposed deal with Adolph Coors. Financial reports from Celestica, and a host of U.S. tech firms, including Microsoft, are in focus this morning. Also dominating headlines is news Procter & Gamble will buy Gillette in a deal worth US$57 billion.

* The S&P/Toronto Stock Exchange Composite Index is sliding 8.94 points,
or 0.10%.

* Yesterday, the S&P/Toronto Stock Exchange Composite Index gained 12.05
points, or 0.13%.

* The Industrial Product Price Index rose 0.3% to 108.5 in December from
a revised 108.2 in November. December's result matched analyst
expectations. Prices were up 3.8% from a year ago. Also, the Raw
Materials Price Index fell 4.3% in December to 126.3 from a revised 132.0
in November. Economists expected the Index to remain unchanged. South of
the border, gross domestic product rose at a 3.1% annual rate in the
fourth quarter, down from the third-quarter's growth of 4.0% and the
second-quarter's 3.3% gain. Economists had forecast fourth-quarter growth
of 3.6%.

* Technology stocks are bouncing back this morning, as Sierra Wireless
and Zarlink Semiconductor rebound, after posting disappointing reports
yesterday. Still, Celestica is slumping, after it reported a
substantially wider fourth-quarter loss of US$3.59 a share, including a
number of charges, from US$0.80 a share last year. On an adjusted basis,
the contract electronics manufacturer earned US$0.19 a share, reversing
last year's loss of US$0.04 a share, and landing ahead of the mean
Thomson First Call estimate of US$0.15 a share. The firm also said it
will cut about 5,500 workers, and as a result, pay an additional
restructuring charge between US$225 million to US$275 million in 2005.

* In the U.S., Dow member Microsoft reported a sharply higher
second-quarter profit from a year ago on revenue that climbed to US$10.8
billion from US$10.2 billion. The firm also raised its fiscal 2005
earnings forecasts.

* Among chipmakers, Novellus Systems and Broadcom reported higher
fourth-quarter earnings that beat Wall Street forecasts. Meanwhile,
PMC-Sierra recorded higher fourth-quarter earnings despite a drop in
revenue. On a non-GAAP basis, earnings met Street forecasts. Elsewhere,
Sanmina Holdings' earnings, on a non-GAAP basis, missed the average
analyst forecast by a penny.

* Within the staples group, Molson shareholders voted in favour of
merging with Adolph Coors. Coors shareholders are scheduled to vote on
the deal on February 1. The merger would create the world's fifth largest
brewer.

* Cott Corp. is sliding this morning. The firm's fourth-quarter earnings
per diluted share fell to US$0.16 from US$0.23 a year ago, partly due to
lower manufacturing efficiencies in the U.S. Sales, however, advanced to
US$369.3 million from US$344.6 million.

* Gold shares and the yellow metal are on the rise this morning, as the
greenback declines modestly against the euro. In research, Iamgold is
leaping, after Paradigm raised its rating to "buy" from "hold."

* Oil prices are slipping, as traders await the results of this weekend's
OPEC meeting on production levels. The highly anticipated general
elections in Iraq are also providing a focus.

* Sherritt International is planning an issuer bid for 10 million shares
and will redeem C$200 million of its 6% debentures. Turning to research
reports, RBC cut its price target on LionOre Mining International to
C$8.50 from C$9.50.

-- 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 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. 28


Source: Thomson Financial Corporate Group

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


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