August 20, 2010 / 1:03 PM / 7 years ago

CANADA STOCKS-TSX set to open lower as fears for recovery grow

5 Min Read

Aug 20 (Reuters) - Toronto's main stock index could open lower on Friday, tracking global equity markets, as weaker-than-expected U.S. economic data this week reinforced fears of a faltering recovery.

Factors to Watch

* Canadian equity futures <0#SXF:> pointed to a lower open.

* A spike in energy costs and a new consumption tax in some provinces pushed up Canada's annual inflation rate to 1.8 percent in July from 1.0 percent in June, but still put little pressure on the central bank to raise interest rates. [ID:nN20500487]

* The Canadian dollar fell to a one-month low versus the U.S. dollar on Friday as Canadian inflation data came in below market expectations and as high-yielding currencies came under broad selling pressure. [CAD/]

* U.S. stock index futures fell on Friday, tracking global equity markets lower. [.N]

* European stocks fell with financial and mining shares among the top losers.

* Asian stocks were also down and the yen threatened to hit 15-year highs as investors sold higher-yielding currencies on risk aversion

Commodity Price Moves

* The Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, fell 0.54 percent in early trade.

* U.S. crude oil prices hovered below $75 a barrel, near six-week lows, after weak U.S. economic data this week raised doubts about the top oil-consuming nation's ability to work through the most ample petroleum inventories in two decades. [O/R]

* Gold held near $1,230 an ounce on Friday as concern over the outlook for the global economy fuelled interest in the metal as a haven from risk, but gains in the dollar kept the metal in a narrow range. [GOL/]

* Copper fell on Friday, on renewed risk-aversion as investors sought perceived safe-haven assets after data on Thursday from the United States, the world's largest economy, revived worries about the demand outlook. [MET/L]

Canadian Stocks to Watch

* Potash Corp (POT.TO) (POT.N): The world's largest fertilizer producer has begun soliciting alternate bids in light of BHP Billiton's (BHP.AX)(BLT.L) $38.6 billion hostile offer to buy the company, a source close to the matter said on Thursday. [ID:nN1996412]

* Suncor Energy Inc (SU.TO): Canada's largest integrated oil production and refining company on Friday reported an outage at one of its hydrogen reformer units at its Alberta oil sands base plant. [ID:nSGE67J0GU]

* Agrium Inc (AGU.TO): The fertilizer maker has completed due diligence on Australia's AWB Ltd AWB.AX after putting in a bid to buy the wheat exporter for A$1.2 billion ($1.07 billion), AWB said, an offer which trumps a lower all-scrip bid by local rival GrainCorp (GNC.AX). [ID:nSGE67J01B]

* Enbridge Inc (ENB.TO): An Enbridge Inc executive said on Thursday that preparations for pressure testing the company's downed oil pipeline in Michigan are expected to continue through the weekend, pushing any restart of the line into next week at the earliest. [ID:nN19274468]

* ComWest Enterprise Corp CWP.V: ComWest announced a deal on Thursday to buy 90 percent of Winnipeg-based Peerless Garments for C$22.28 million in cash. [ID:nN19273440]

* Alimentation Couche-Tard (ATDb.TO): The Canadian convenience store chain battling to take over Casey's General Stores CASY.O in the United States, urged Casey's shareholders on Thursday to back its nominees to Casey's board of directors. [ID:nN19251941]

Analyst Recommendations

Following is a summary of research actions on Canadian companies reported by Reuters. [RCH/CA]

* BMO (BMO.TO) rating started with market perform; target price of C$64 at KBW

* Fronteer Gold FRG.TO target price raised to C$8.40 from C$6.50; rating speculative buy at Canaccord Genuity

* RBC (RY.TO) rating started with outperform; target price of C$60 at KBW

* Southern Pacific Resource STP.TO target price raised to C$2.50 from C$2.25; rating strong buy at Raymond James

* TD Bank (TD.TO) rating started with market perform; target price of C$80 at KBW

$1=$1.05 Canadian Reporting by Bangalore newsroom, editing by Bhaswati Mukhopadhyay and Jeffrey Hodgson

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