Toronto stocks set to open higher for third day

Tue Jun 17, 2008 9:17am EDT
 
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*Stocks seen rising on rate hike outlook

*BCE court decision front and center for investors

TORONTO, June 17 (Reuters) - Toronto stocks looked set to open in positive territory for a third straight day on Tuesday, as expectations of higher interest rates worldwide were scaled back.

The S&P/TSX composite index .GSPTSE closed up 165.82 points, or 1.12 percent, at 14,944.28 on Monday, with all but two of its 10 main sectors rising.

"We've had some reasonably constructive comments out of the central banks worldwide today, which should provide us with a little lift," said Rick Hutcheon, president and chief operating officer at RKH Investments.

"They're kind of telling us that the fears that had been built into the market -- that the Fed and the ECB and the Bank of England and so forth, we're going to start ratcheting up interest rates in a big hurry -- may be a little bit unfounded,"

Rising interest rates would, especially in the United States, support a stronger U.S. dollar, which could negatively impact the price of gold and oil.

In the short term however, oil and gold stocks could be under pressure as prices of the commodities slid overnight.

The main focus for Canadian investors will be the Supreme Court of Canada's hearing on BCE Inc's (BCE.TO: Quote)(BCE.N: Quote) leveraged buyout.

South of the border, Goldman Sachs (GS.N: Quote) reported its stronger than expected quarterly results, which offered some reassurance about the outlook for financials, and was seen as supporting the banking sector. ($1=$1.02 Canadian) (Reporting by John McCrank; Editing by Bernadette Baum)