Firm commodities seen boosting Toronto stocks

Mon May 5, 2008 9:07am EDT
 
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TORONTO May 5 (Reuters) - Toronto's main stock market index was set to rise for a fourth straight session on Monday as firm commodity prices prop up the resource-heavy index.

But technology shares could see pressure after software giant Microsoft Corp (MSFT.O: Quote) dropped its bid for Yahoo Inc (YHOO.O: Quote), raising concern for the outcome of other mergers and acquisitions.

"It certainly looks like it's going to be strong for the commodity producers. All of the major commodities are up so it's a good psychology," said Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier.

"But we could get weighed down by what is going on with Microsoft and Yahoo."

Oil shares are expected to get a boost as the price for crude oil rose 0.5 percent to $116.83 a barrel on fear that Nigerian output cuts and geopolitical tensions between Iran and the West would trim supply.

Gold companies could rise as the price of the precious metal jumped to $864.35 an ounce on profit taking, following a drop to four-month lows last week.

Goldcorp Inc (G.TO: Quote) could see interest after Canada's No. 2 producer reported a huge jump in its first-quarter profit, helped by record gold prices and a strong performance from its Latin American operations.

Paramount Gold and Silver PZG.TO could attract attention after it formed an alliance with Mexoro Minerals MXOM.OB to combine their mining and exploration expertise.

But technology companies could fall in sympathy with their U.S. counterparts as Yahoo tumbled in pre-trading after Microsoft withdrew its $47.5 billion takeover for the Internet search company.   Continued...