May 9, 2011 / 3:08 PM / 8 years ago

CANADA STOCKS-TSX edges higher on materials, Forzani deal

   * TSX climbs 0.16 percent to 13,588.00
 * Seven of 10 main sectors rise
 * Canadian Tire to buy Forzani for C$771 mln; shares rise
 * Nexen sags more than 4 pct on suspended operations  (Adds details)
 By Ka Yan Ng
 TORONTO, May 9 (Reuters) - Toronto’s main stock index edged up slightly on Monday morning as commodity prices recovered from last week’s hefty losses, boosting shares of mining and energy companies.
 The materials group, up 0.73 percent, was supported by a rebound in prices for copper, gold and silver, and other metals. [O/R][MET/L] [GOL/]
 Barrick Gold (ABX.TO) rose 1 percent to C$45.89, while Goldcorp (G.TO) advanced 1.35 percent to C$48.
 The energy sector was little changed as Nexen NXY.TO slid more than 4 percent to C$22.67 after it said production and operations had been halted in Yemen as a result of a strike. [ID:nL3E7G92D9]
  Other energy issues were generally higher, with Husky Energy (HSE.TO) ahead 0.83 percent at C$27.83, and Encana (ECA.TO) up 0.35 percent at C$31.50.
 At 10:45 a.m. (1445 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 21.40 points, or 0.16 percent, at 13,588.00. Seven of the index’s 10 main groups were up, led by materials, although a 0.32 percent decline in financials weighed on overall gains.
 “It’s waffling here,” said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier. “We’re in a bit of a void here. I think we’re going to be more following the macroeconomic trends, and the trends have been showing, to me, a lower rate of growth in the overall economy.”
 Canadian Tire (CTC.TO) (CTCa.TO) and Forzani Group FGL.TO both rose on Monday on news of a friendly deal that will give Canadian Tire a commanding stake in the sporting goods market at a time when U.S. retailers are eyeing growth opportunities north of the border. [ID:nL3E7G91PE]
 Canadian Tire, which already holds about 4 percent of Forzani shares, offered to take full ownership of the country’s largest sporting goods retailer for C$771 million.
 Forzani jumped 49 percent to C$26.22, in line with the 50 percent premium over Friday’s closing share price that Canadian Tire has offered for each Forzani share.
 Canadian Tire was up 2.78 percent at C$60.22. The consumer discretionary group rose 0.7 percent.
 “Investors seemed to be looking at the commodity space to what’s going to be taken out next. It makes sense to me what Canadian Tire’s doing, but it certainly came as a surprise to me,” said Nakamoto. “I think they have proven themselves as pretty good operators and acquirers.”  (Reporting by Ka Yan Ng, editing by Rob Wilson)                                        

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