Canadian Shares Add to Yesterday's Gains

Canadian Shares Add to Yesterday's Gains

Tuesday, February 1, 2005, 10:15 AM EST: (Thomson Financial Corporate Group): Bay Street is witnessing a healthy rise in early trading, bolstered by technology, mining, material and healthcare stocks. In the headlines, Nortel Networks revealed its audited results for the first half of 2004. South of the border, the FOMC kicks off a two-day meeting today, with a decision on interest rates due tomorrow afternoon. Also, Dow member Walt Disney posted better-than-expected earnings on higher revenues, while American Express will spin off its Financial Advisors unit.

* The S&P/Toronto Stock Exchange Composite Index is lifting 16.05 points,
or 0.17%.

* Yesterday, the S&P/Toronto Stock Exchange Composite Index surged 62.27
points, or 0.68%.

* Nortel Networks released financial statements for the first half of
2004. For the first quarter, Nortel earned US$59 million on revenue of
US$2.44 billion. On a per share basis, net earnings were US$0.01,
compared to a deficit of US$0.03 last year. In the second quarter, the
firm posted a profit of US$16 million on US$2.59 billion in revenue. On
a per share basis, the firm broke even from a loss of US$0.02 in the
corresponding period a year ago. Nortel Networks is on the rise this
morning.

* In research, Canaccord downgraded Creo to "hold" from "speculative buy."
Yesterday, Eastman Kodak agreed to buy the firm for US$980 million.

* Oil prices are declining, as warmer weather is expected in the
northeastern U.S. OPEC's decision to keep production levels steady is
also contributing to lower prices.

* In deal reports, Talisman Energy is buying Petra A.S., a subsidiary of
Petroleum Geo-Services ASA of Norway, for US$155 million. The deal
doubles Talisman's business in Norway. Separately, Encana said that it
will remove approximately 363 million barrels of its Foster Creek
bitumen reserves from the proved category in order to comply with U.S.
Securities and Exchange Commission requirements. Turning to research,
Lehman Brothers upgraded Suncor Energy and Canadian Natural Resources to
"overweight" from "equal-weight." Also, Prudential raised its rating on
Inco to "overweight" from "underweight."

* Gerdau Ameristeel swung to a fourth-quarter profit of US$0.23 a share,
reversing a year-earlier loss of US$0.02 a share. Sales leapt to
US$849 million from US$493 million last year.

* Meanwhile, Northern Orion Resources entered into an agreement to sell
27.4 million stock-warrant units at C$3.65 each to a syndicate of
investors for gross proceeds of C$100 million. Proceeds will be used for
development of the Agua Rica Project and for general corporate purposes.

* Gold shares are moving higher this morning, despite greenback strength
against the euro. In research, Sprott upgraded Iamgold to
"speculative buy" from "market perform" and raised its price target to
C$11 from C$10.

* In U.S. economic reports, the ISM manufacturing business index slipped
to 56.4 in January from 57.3 in December. Also, construction spending
advanced 1.1% in the December reading.

-- 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/.


Source: Thomson Financial Corporate Group

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