October 1, 2010 / 1:15 PM / 7 years ago

RPT-CANADA STOCKS-TSX set to open firmer after Chinese, US data

Oct 1 (Reuters) - Toronto’s resource-heavy main stock index looked set to open higher on Friday, with commodity prices firm after better-than-expected U.S. consumer spending data and a report showing strong demand in China’s manufacturing sector.

FACTORS TO WATCH

* Canadian equity futures <0#SXF:> pointed to a higher open.

* U.S. stock index futures briefly added gains on Friday after data showed consumer spending rose slightly more than expected, while a top Fed official said more action is needed to boost growth if the economy does not improve. [.N]

* European stocks erased early gains and turned negative around midday on Friday as retreating banking stocks overshadowed strong gains in the energy sector following Repsol’s (REP.MC) deal with Sinopec Group. [.EU]

COMMODITY PRICE MOVES

* The Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, rose 0.63 percent in early trade.

* Oil rose to $81, a seven-week high, boosted by stronger-than-expected U.S. and Chinese economic data which raised hopes of demand recovery in the world’s largest consumers. [O/R]

* Gold hit record highs for a sixth successive session as the dollar fell to a six-month low against the euro, with expectations for further U.S. monetary easing driving strong demand for the precious metal. [GOL/]

* Copper rallied to its highest in more than two years as strong manufacturing data from China, the world’s largest consumer of industrial metals, boosted demand expectations. [MET/L]

CANADIAN STOCKS TO WATCH

* Potash Corp. (POT.TO). BHP Billiton said on Friday it expected to lodge a motion within the next few days to challenge a lawsuit filed by Potash to fend off the miner’s $39 billion hostile takeover bid. BHP said its lawyers were finalizing details of the dismissal motion which could be filed as early as Friday. [ID:nSGE690008]

* Research In Motion RIM.TO: India’s telecommunications ministry has rejected a solution offered by the BlackBerry maker for its BlackBerry corporate email services, and it has not been able to access chats on the messenger service either, the Economic Times reported on Friday. [ID:nSGE690032]

* Alimentation Couche-Tard (ATDb.TO): The company abandoned its $2 billion hostile takeover bid for Casey’s General Stores on Thursday, nearly half a year after it made its initial offer for the U.S. convenience store chain. [ID:nN30225942]

* First Quantum Minerals (FM.TO): The miner launched another leg of its legal battle against the withdrawal of licences for copper mines in the Democratic Republic of Congo, filing an international arbitration case for its Frontier mine. [ID:nLDE69006L]

* Centerra Gold (CG.TO): Workers at the Kumtor gold mine in Kyrgyzstan, the flagship asset of the Canadian miner, went on strike on Friday in a move that could damage budget revenues in the impoverished Central Asian state. [ID:nLDE69005F]

* Exfo Inc. (EXF.TO): The company sold its life sciences and industrial division for $24.3 million in cash to private-equity firm, The Riverside Co, to focus on its core telecom business. [ID:nSGE6900FP]

ANALYST RECOMMENDATIONS

Following is a summary of research actions on Canadian companies reported by Reuters. [RCH/CA]

* CGA Mining CGA.TO price target raised to C$4 from C$3 and rating outperform at BMO

* Gasfrac Energy GFS.V coverage started with outperform rating and C$10 target price at BMO

* Shoppers Drug Mart SC.TO price target raised to C$45 from C$40; rating buy at UBS

$1=$1.03 Canadian Reporting by Bangalore Newsroom; Editing by Jeffrey Hodgson

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