(Adds details, Nortel bankruptcy filing)
TORONTO, Jan 14 (Reuters) - Toronto’s key stock index could open higher on Wednesday as a rise in oil prices support the resource heavy index, but telecommunications equipment maker Nortel Networks may steal the spotlight after news that it filed for bankruptcy protection.
Toronto’s energy sector accounts for about 22 percent of the overall index, and its moves are often influenced by the price of oil, which is a key Canadian export.
As is often the case, the energy group has gone the way of oil prices in recent sessions, which means the rise in oil prices on Tuesday helped steer the broader index from its third straight selloff.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE is coming off a sharply higher close on Tuesday as investors raced back into equities after a string of selloffs had left the TSX at its lowest level in two weeks.
Here is some of the news that may affect the market:
Nortel Networks Corp NT.TONT.N, North America’s biggest maker of telephone equipment, filed for bankruptcy protection on Wednesday, a day before it was due to make an interest payment of about $107 million. [ID:N14442895]
Nortel shares plunged more than 76 percent to 7.5 cents in electronic pre-market trading.
Oil rose 3 percent towards $39 a barrel on Wednesday, as OPEC kept up talk of production cuts and a cold snap in the United States boosted heating oil demand. [ID:nLE636936]
Gold firmed in Europe on Wednesday, supported by a weaker dollar and rising oil prices, though it pared gains as the euro slipped from highs against the U.S. currency and equities and base metals turned negative. [ID:nLE364966]
Newspaper publisher and broadcaster Canwest Global Communications Corp CGS.TO warned on Wednesday it may fall short of certain financial covenants in its credit facilities, due to the weak economy. [ID:nN13397635]
Cogeco Cable Inc CCA.TO reported a stronger quarterly profit on Wednesday, helped by growth in its Canadian operations. [ID:nN14445013]
Canadian media and entertainment company Corus Entertainment Inc (CJRb.TO) lowered its fiscal 2009 outlook, despite reporting higher quarterly profit, as it anticipates a slowdown in advertising revenue. [ID:nN14254524]
Following is a summary of research on Canadian companies. For more, please see [RCH/CA]
* Raymond James curs ARC Energy Trust AET_u.TO price target by 4.8 percent to C$20 with “market perform” rating.
* Genuity cuts Bankers Petroleum BNK.TO price target 34.8 percent to C$1.50 with “Buy” rating.
There is no key domestic economic data due out ahead of the Bank of Canada’s next interest rate announcement scheduled for Jan. 20. The central bank cut its key rate in December to its lowest level in 50 years and is widely expected to cut it again next week.
$1=$1.22 Canadian Reporting by Frank Pingue, Editing by Jeffrey Hodgson