TORONTO, Nov 2 (Reuters) - Toronto’s main stock index may begin trading in November with a higher start on Monday after a steep drop the previous week, and as rising key commodity prices were expected to support the resource-laden index.
The S&P/TSX composite index .GSPTSE broke its seven-month rally on Friday, dropping 1.5 percent in the session, and closing October down 4.25 percent.
U.S. stock index futures also signaled a rebound on Monday [ID:nN02425600], and the sentiment may spill over to Toronto stocks.
Here is some of the news that may affect the market.
GOLD, OIL RISE
Gold rose above $1,050 an ounce, wiping out most of the previous week’s losses, as dollar weakness made bullion cheaper for holders of other currencies. [GOL/]
Oil rose above $77 a barrel, recovering from the previous session’s steep drop, after manufacturing data from China revived expectations economic recovery would generate extra fuel demand. [O/R]
DATA ON TAP ECON
No Canadian data is scheduled for Monday, but the market may react to U.S. manufacturing data from the Institute of Supply Management for October. September numbers on construction spending and pending home sales are also scheduled. All figures due at 10 a.m. (1500 GMT)
CIT Group Inc (CIT.N), a lender to a million small and mid-sized U.S. businesses, filed for bankruptcy on Sunday. The bankruptcy is one of the largest in U.S. corporate history and could push some small businesses that it finances to look for new credit in a tough funding environment. [ID:nN01476782]
RESEARCH ROUNDUP: DOMTAR
Raymond James upgraded Domtar Corp (UFS.TO) (UFS.N) to “outperform” from “market perform,” citing its robust free cash flow generation, and said it expects the forestry firm to benefit from U.S. and Canadian government tax programs. [ID:nBNG245503]
Other research actions [RCH/CA] on Canadian companies reported by Reuters on Monday include:
* National Bank Financial cuts Cogeco Cable (CCA.TO) to sector perform from outperform
* RBC raises Saputo Inc (SAP.TO) price target
* Genuity resumes Air Canada ACa.TO with buy, raises price target
DEALTALK: Canadian Royalties deal seen unlikely for Jilin
China’s No. 2 nickel producer Jilin Jien’s (600423.SS) ambition to expand its Canadian footprint, is facing its biggest hurdle as investors look set to reject its final bid for early-stage miner Canadian Royalties CZZ.TO [ID:nBNG318301]
CENTRAL BANKS IN SPOTLIGHT
Investors were bracing for a week of meetings at major central banks, including the U.S. Federal Reserve and European Central Bank, the release of minutes from the past meetings of others and a G20 finance ministers’ meeting. [M/DIARY] At issue in all cases is the future of the liquidity that has been behind much of this year’s financial market recovery.
BAY STREET-BANKS, PROPERTY TOP BETS IF C$ STAYS STRONG
Buyers of Canadian banks, utilities, property firms and some retailers look set to become long-term winners if the country’s currency — as many predict — resumes its recent rally to top the U.S. dollar in value. But manufacturers, including auto parts makers, forestry companies, and other export-reliant industries, are expected to feel further pain. [ID:nN30411061]
(Reporting by Ka Yan Ng; Editing by Theodore d’Afflisio)