TORONTO, Jan 9 (Reuters) - Toronto’s main index could open higher on Friday as investors resume their appetite for riskier assets after key jobs from the United States showed employers cut payrolls in December by less than expected.
The U.S. report arrived 90 minutes after data showed the Canadian economy cut more jobs than expected in December for the second straight month in a sign that the economy has likely slipped into a recession.
It also cements the view that the Bank of Canada will lower its key overnight rate again on Jan. 20 following its December decision to cut rates by 75 basis points to a 50-year low of 1.50 percent.
Toronto’s index could also get caught in a tug-of-war between the weighty materials and energy sectors as oil prices turned lower while gold prices were given a boost after the U.S. jobs data.
The S&P/TSX composite index .GSPTSE is coming off a higher close after a late-session burst on Thursday that was powered by the materials group.
Here is some of the news that may affect the market:
CANADA ECONOMY SHEDS MORE JOBS IN DECEMBER
Canadian employers cut more jobs than expected in December for the second straight month and the unemployment rate jumped to its highest since January 2006 in a sign that the economy has likely slipped into a recession. [ID:nN09253705]
US DEC PAYROLLS FALL 524,000, JOBLESS RATE 7.2 PCT
U.S. employers slashed payrolls by 524,000 in December, driving the unemployment rate to its highest level in almost 16 years, a government report showed on Friday, suggesting that the year-long recession was deepening. [ID:nN08546114]
U.S. GOLD RISES FURTHER AS U.S. DOLLAR FALLS ON JOBS DATA
New York gold futures rose further early Friday as the dollar fell against the euro and the yen after a government report showed the U.S. unemployment rate surged to its highest level in 16 years. [ID:nN09307897]
NATURAL GAS EDGES LOWER WITH WEEKEND CASH, CRUDE
U.S. natural gas futures were trading about 3 cents lower in early electronic trade Friday., pressured by weaker Henry Hub cash gas on expected lighter weekend industrial loads ands with sliding crude futures. [ID:nN09282194]
CANADA‘S FLAHERTY SEES ‘SUBSTANTIAL’ DEFICIT
Canada will run a “substantial” budget deficit in the next fiscal year as it enacts stimulus measures to help shelter the economy from the effects of the global economic downturn, Finance Minister Jim Flaherty said on Thursday. [ID:nN08221554]
RESEARCH ROUNDUP: GOLDCORP, KINROSS
Following is a summary of research actions on Canadian companies. For more, please see [RCH/CA]
* Genuity raises Alamos Gold AGI.TO price target by 14 percent to C$8.00
* Genuity upgrades Goldcorp (G.TO) to a “buy” rating and increases price target by 5 percent to C$38.00.
* Genuity downgrades Kinross (K.TO) to a “hold” rating from “buy”. (Reporting by Frank Pingue)