* Rising gold and oil prices could buoy resource issues
* Borealis offer for Teranet may stir investors
TORONTO, Sept 4 (Reuters) - Toronto’s main stock market index was seen opening on a positive note on Thursday, buoyed by firm commodity prices, as it recoils from two days of steep losses.
Merger and acquisition activity could also help jump start the market after Borealis Infrastructure said on Thursday it planned to offer more than C$2 billion ($1.9 billion) in cash for Teranet Income Fund TF_u.TO.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE begins the day 13,137.72 following a loss of more than 160 points in the previous session when it was yanked lower by mounting concerns over falling demand for commodities.
Wednesday’s loss followed on the heels of a massive 471 point loss on Tuesday.
But the resource-heavy index is expected to bounce back on Thursday as the prices for the key commodities, including U.S. crude oil and gold recover.
“It should be a bounce today. The market is very much oversold,” said John Ing, president at Maison Placements Canada. “Toronto has been under heavy, heavy selling.”
Canada’s energy companies, which account for about 30 percent of the market’s overall weighting, are expected to benefit from a rebound in the U.S. crude price.
The key commodity was up 0.5 percent at $109.90 a barrel as a number of U.S. refineries remained shut because of hurricane disruption in the U.S. Gulf and ahead of government data that is expected to show a fall in inventory.
The gold group, home to some of the biggest producers in the world, could benefit from rising prices as the precious metal jumped more than $10 an ounce to settle above $800 on a weak U.S. dollar and rising demand.
Industrial issues could see a boost from Bombardier Inc (BBDb.TO) after the plane and train maker returned to profitability in the second quarter, compared with the same period last year when it recorded a big write-off on the value of its investment in Metronet Rail.
Financial shares, which were the only ones to post gains in the previous session, could rise on the back of more positive results. Canadian Western Bank (CWB.TO) said on Thursday its quarterly profit rose 9.6 percent due partly to higher loan growth.
But the lightly weighted healthcare group could suffer after MDS Inc MDS.TO reported weaker fiscal quarterly results and slashed its 2008 outlook as it copes with slower-than-expected revenue at its contract research division. ($1=$1.05 Canadian) (Reporting by Scott Anderson; Editing by Frank McGurty)