December 10, 2009 / 1:08 PM / in 11 years

CANADA FX DEBT-C$ gains on firm oil, steady stocks

   * C$ up at C$1.0505 to the U.S. dollar
 * Bonds prices drift lower on supply concerns
 By Jennifer Kwan
 TORONTO, Dec 10 (Reuters) - The Canadian dollar rose
against the U.S. currency on Thursday, boosted by firm oil
prices and signs that U.S. stocks will rise at the open as
investors thirst for risk returns.
 Oil, a key Canadian export, rose 0,5 percent to about $71 a
barrel after falling more than 2 percent in the previous
session, supported by a limp dollar and rising equities [O/R]
[MKTS/GLOB]. U.S. stock index futures gained ahead of the
release of weekly initial jobless claims. [.N]
 "It's a risk-on day," said Steve Butler, director of
foreign exchange trading at Scotia Capital. "We probably have
been a little oversold."
 At 7:41 a.m. (1241 GMT), the Canadian dollar CAD= was at
C$1.0505 to the U.S. dollar, or 95.19 U.S. cents, up from
Wednesday's finish at C$1.0545 to the U.S. dollar, or 94.83
U.S. cents.
 Butler said the currency could also follow the lead of
other commodity-linked currencies such as the Australian and
New Zealand dollars, which rose sharply on growing expectations
of higher interest rates.
 Strong Australian jobs data fueled anticipation that rates
will rise further in Australia and the Reserve Bank of New
Zealand signaled its rates may rise sooner than thought.
 Canadian bond prices followed U.S. Treasuries lower on
supply concerns after a weak 10-year debt auction in the
previous session and as investors braced for more longer-dated
supply on Thursday.
  (Reporting by Jennifer Kwan; editing by Jeffrey Benkoe)

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