UPDATE 1-Toronto stocks inch up as Fording mulls options
(Adds details, analyst comments)
TORONTO Dec 6 (Reuters) - The Toronto Stock Exchange's main index inched higher on Thursday, lifted by takeover speculation in the materials sector after Fording Canadian Coal Trust FDG_u.TO said it was exploring strategic alternatives, including a sale.
However bank stocks dragged on the market after Canadian Imperial Bank of Commerce (CM.TO: Quote) said it expects more writedowns related to the troubled U.S. subprime mortgage market.
The TSX's cautious rise came after the Bank of England cut interest rates in an effort to boost liquidity in markets hobbled by the global credit crunch sparked by the U.S. subprime meltdown.
The move by the British central bank comes on the heels of a surprise rate cut by the Bank of Canada, and analysts said the relatively flat Toronto market indicated investors have buckled up ahead the U.S. Federal Reserve's rate decision next week.
Central banks "certainly are giving us the rhetoric that they're going to be there," said Rick Hutcheon, president and chief operating officer at RKH Investments.
"We're consolidating yesterday's gains -- take tarts when tarts are passed, right, and that's where we're at now."
The S&P/TSX composite index .GSPTSE was up 21.57 points, or 0.2 percent, at 13,739.55. It jumped more than 150 points the day before.
The market initially cheered fourth-quarter results from CIBC, whose stock was the biggest weighted gainer minutes after trading began. But CIBC reversed sharply and was soon the biggest weighted loser, down C$4.65 at C$82.44 just before midday. For details, see: [nN06206196] Continued...