December 2, 2010 / 1:54 PM / 7 years ago

CANADA STOCKS-TSX to open high, banks may temper gains

Dec 2 (Reuters) - Toronto’s stock index could open higher on Thursday, extending Monday’s rally on rising commodity prices and optimism about possible new measures to ease euro zone debt crisis. But lower earnings from Toronto-Dominion Bank and CIBC could temper the optimism.

FACTORS TO WATCH

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

* U.S. stock index futures rose slightly on expectations the European Central Bank may act to relieve market worries of a spreading euro zone debt crisis. [.N]

* European shares also edged up, with banking stocks among the risers. [.EU]

* Asian stocks rose. The Nikkei jumped almost 2 percent as the yen softened.

COMMODITY PRICE MOVES

* The Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, rose 0.54 percent in early trade.

* Oil prices were steady near three-week highs of $87.

* Gold firmed a touch, supported by some safe-haven buying and a softer dollar. [GOL/]

* Base metals rose, with copper hitting a three-week high, on supportive economic data, supply fears and a weaker dollar. [MET/L]

CANADIAN STOCKS TO WATCH

* Toronto-Dominion Bank (TD.TO): Canada’s second-biggest lender said fourth-quarter profit fell 1.6 percent, as stronger retail banking income was offset by weak wholesale banking results. [ID:nN02200788]

* Canadian Imperial Bank of Commerce (CM.TO): Canada’s No. 5 bank said quarterly profit fell 22 percent as it took charges on its structured credit run-off business and capital repatriation activities. [ID:nN02213989]

* Canadian Natural Resources Ltd. (CNQ.TO): The independent oil explorer forecast a largely higher capital budget for 2011 and said it would use about 45 percent of the spending for long-term growth. It set a 2011 capital budget range of C$5.57 to C$5.97 billion, compared with 2010 estimated spending of $5.6 billion. It also expects 2011 production of 645,000 to 694,000 bopd before royalties. [ID:nSGE6B108H]

* Bombardier Inc. (BBDb.TO): The civil aircraft maker reported a 15 percent drop in third-quarter profit on weak revenue at both its segments. It said the aerospace environment remained difficult. [ID:nSGE6B108X]

* Gildan Activewear Inc. (GIL.TO): The clothing maker reported a 34 percent rise in profit and forecast higher 2011 sales. [ID:nSGE6B10AC]

* Enbridge Inc. (ENB.TO): The pipeline carrier raised its quarterly dividend by 15 percent and forecast 2011 adjusted earnings of C$2.75 to C$2.95 a share, up from this year’s target of C$2.50 to C$2.70. [ID:nN01169344] It also boosted flow rates on its 670,000 barrel a day Line 6A oil pipeline after repair to an electrical substation in Illinois. [ID:nN01168267]

ANALYST RECOMMENDATIONS

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

* Lake Shore Gold LSG.TO price target raised to C$4.60 from C$4.30; keeps outperform rating Raymond James

* Mag Silver (MAG.TO) price target raised to C$13.50 from C$13; keeps outperform rating at Raymond James ($1= $1.01 Canadian) (Reporting by Kishan Nair and Bangalore Newsroom)

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