Canadian Shares Surge Amid Broad-Based Strength

Canadian Shares Surge Amid Broad-Based Strength

Friday, February 4, 2005, 4:15 PM EST: (Thomson Financial Corporate Group): Toronto stocks snapped their early malaise and surged, bolstered by energy, technology, telecom, healthcare and real estate issues. January employment data from both sides of the border were in focus. Disappointing employment figures in the U.S. sparked talk the Fed may be less aggressive in raising rates, which in turn sent markets higher. Meanwhile, financial results from Noranda, Creo and Dofasco were in focus.

* The S&P/Toronto Stock Exchange Composite Index leapt 54.57 points, or 0.59%.

* Topping economic headlines, Canada lost 5,700 jobs in January, following the addition of a downwardly revised 15,100 jobs in December. Economists expected 12,000 jobs would be created last month. Still, January's unemployment rate remained flat at 7.0%. Separately, the Ivey Purchasing Managers Index arrived at 50.0 in January, below expectations for a reading of 53.0, and down from 54.6 in December.

* South of the border, non-farm payrolls grew by 146,000 in January, well below the anticipated increase of 200,000. Also, December and November payrolls were downwardly revised. Still, the unemployment rate slid to 5.2% from 5.4%, versus expectations for a flat rate. Also, the University of Michigan's final consumer sentiment reading for January was 95.5, down from 97.1 in December.

* Noranda said that higher metal prices and increased sales volumes of copper, lead, aluminum and silver helped boost its fourth-quarter earnings per share to US$0.50 from US$0.18 a year earlier. Revenues leapt to US$1.92 billion from US$1.32 billion. For the year, net income advanced to US$1.75 a share from nil a share the year before. The firm also said a deal for the sale of the company could be announced "within the next few months."

* Steel firm Dofasco posted record earnings per share in 2004 of C$4.90 from C$1.55 a year ago. For the fourth-quarter, the firm's net income was C$1.25 a share, handily beating the mean Thomson First Call estimate of C$1.16 a share, and above last year's restated net profits of C$0.03 a share.

* Gold prices and the yellow metal tumbled, amid greenback strength on upbeat comments from Federal Reserve Chairman Alan Greenspan regarding the U.S. trade deficit. In corporate reports, Teck Cominco returned some of the gains acquired yesterday on its robust quarterly report. Today, National Bank, BMO, GMP and Canaccord raised their price targets on the firm. Separately, oil prices recovered somewhat from recent weakness.

* In technology reports, Creo said that its first-quarter earnings fell to US$0.10 a share from US$0.24 a share in the corresponding period a year earlier. Still, revenue climbed 12.4% to US$174.6 million from US$155.3

million. Analysts were looking for earnings of US$0.07 a share, in a range from US$0.03 to US$0.09 a share, as provided by Thomson First Call.

* Turning to the industrial group, Bombardier tumbled. A lawyer for Platinum Jet Management, the firm operating the Bombardier Canadair Challenger CL-600 that skidded into a New Jersey warehouse, said the pilot told him "something broke" right before he took off. U.S. Dow component Boeing advanced on word Japan Airlines agreed to buy 30 Boeing 737NG jetliners in a deal that could be valued at up to US$1.8 billion.

* Staple shares moved higher. Rothmans rallied, after it announced an increase to its quarterly dividend by 20% and a 2-for-1 stock split by way of a stock dividend. The firm's third-quarter net earnings fell to C$0.75 a share from C$0.77 a share last year. The most recent result beat the mean analyst forecast by a penny, as provided by Thomson First Call. Subsequently, BMO and Dundee upgraded the stock and lifted its price target.

-- 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 -- Feb. 4


Source: Thomson Financial Corporate Group

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


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