3 Min Read
*TSX expected to open higher on profit-taking
*Caution over U.S. economic outlook could weigh
*Loblaw reports 18 percent jump in profit
TORONTO, July 25 (Reuters) - The Toronto Stock Exchange's main index is expected to open higher on Friday, as investors scoop up shares after Thursday's big slide, but cautiousness over the outlook for the U.S. economy may weigh.
The benchmark slipped more than 2 percent on Thursday, triggered by losses in financials as investors seized on data highlighting concerns over a slumping U.S. economy.
Performance in the heavily-weighted sector withered from this past week's steady ascent after U.S. bank stocks fell on data that showed a drop in sales in existing U.S. homes.
The sector, which had been battered by the fallout from the credit crunch and U.S. housing slump, rose more than 16 percent in the past week on better than foreseen U.S. bank results.
Canadian banks report their quarterly results around the end of next month.
Typically, after a big drop the market would be expected to rally, but investor jitters may keep the benchmark at bay, said Michael Sprung, president at Sprung & Co. Investment Counsel.
"People are becoming more and more concerned about the fragility of the economic situation right now," he said.
U.S. stock futures were higher. U.S. durable goods rose unexpectedly in June and building permits were revised higher.
In company news, Loblaw Companies Ltd (L.TO), Canada's biggest supermarket chain, reported an 18 percent rise in second-quarter profit while Norbord Inc NBD.TO reported a bigger second-quarter loss, as U.S housing woes continued to drain demand for its wood panels.
Contract electronics maker Celestica Inc (CLS.TO)CLS.N could also draw attention after it swung to a second-quarter profit.
The key resource sectors could find some support in underlying commodity prices.
Oil rose to around $126 a barrel, after being battered this week on concerns over growth in demand and as buyers were drawn to the commodity ahead of the weekend.
Gold held steady at around $929 an ounce on firmer oil and as the U.S. dollar weakened.
The S&P/TSX composite index .GSPTSE begins the day at 13,206.14, down 306.52 points, or 2.27 percent. ($1=$1.02 Canadian) (Reporting by Jennifer Kwan; editing by Janet Guttsman)