Toronto stock index to open higher

Wed Jul 9, 2008 9:11am EDT
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*TSX expected to open higher

*Rebound in oil price to support index

TORONTO, July 9 (Reuters) - The Toronto Stock Exchange's main index looked set to open higher on Wednesday, benefiting from a rise in oil prices and firmness in financials.

Oil prices, which had slipped from record highs this week, rebounded to around $138 a barrel as political tension rose amid reports Iran had test-fired missiles.

"The U.S. dollar is trading lower and that's helping to push oil higher for the first time in about a week," said Steve Ibel, institutional equities trader at Beacon Securities, in Halifax, Nova Scotia. "I think Toronto markets will benefit from that."

Financials could also provide support after the Bank of Canada moved to suspend operations to get short-term lending on track, which could signal a step toward stability in the credit environment, said Ibel.

However, any strength in the index could be tempered by softer materials issues amid weakness in some metals prices.

In company news, Canadian radio and specialty-TV group Corus Entertainment Inc CJRb.TO could draw attention after it reported a 27 percent jump in its third-quarter profit on Wednesday, helped by strength in its broadcasting businesses and income-tax recoveries.

MDS Inc MDS.TO said on Wednesday it has filed a C$1.6 billion court claim against Atomic Energy of Canada Ltd and the government of Canada for breach of contract related to a nuclear reactor project.

The S&P/TSX composite index .GSPTSE begins the day at 13,809.77, after a late-day surge on Tuesday yanked the index higher as gains in the wider market offset a drop by energy shares.

The rally pulled the benchmark away from official correction territory, but it remained down 8.9 percent from the record high it reached in early June. (Reporting by Jennifer Kwan; Editing by Scott Anderson)