December 11, 2008 / 1:55 PM / 9 years ago

CANADA STOCKS-TSX to open down as BCE, US auto bailout in focus

TORONTO, Dec 11 (Reuters) - Toronto’s main stock index could open lower on Thursday as the market focuses on the collapse of the BCE Inc BCE.TO buyout and amid uncertainty over the possible bailout of the U.S. auto industry.

However, the index could see strength from firmer oil and gold prices.

On Wednesday, the S&P/TSX composite index .GSPTSE rallied 236.44 points, or 2.82 percent, to 8,634.00, as signs of reduced oil supplies sparked a rally in energy shares, but financials capped the gains as they tumbled on economic worries and concerns about the fate of a bailout for U.S. automakers.

Here is some of the news that may affect the market:

BCE BCE.TO

The C$34.8 billion buyout of Canada’s biggest telecoms company BCE Inc collapsed on Thursday after the buyers said a key condition to the deal was not met. [ID:nN11358392]

ENCANA ECA.TO

EnCana Corp slashed its 2009 capital budget by 18 percent to about $6.1 billion as it looks to weather falling commodity prices and economic uncertainty. [ID:nBNG190957]

PETRO-CANADA PCA.TO

Petro-Canada says it expects to cut spending next year by 36 percent as it weathers tumbling oil prices and economic turmoil. [ID:nN10346784]

RETAIL EARNINGS

Gildan Activewear GIL.TO fourth-quarter profit nearly halved, missing Wall Street estimates [ID:nBNG119073], while yoga wear retailer Lululemon Athletica LLL.TO reported a higher quarterly profit but cut its full-year outlook as it braced for tough times. [ID:nN11281189]

US AUTO BAILOUT?

The House of Representatives approved bailout legislation late on Wednesday, sending the measure to the Senate where prospects for passage appeared grim. [ID:nN09294627]

ACE AVIATION ACEa.TO

ACE Aviation Holdings Inc, owner of a 75 percent stake in Air Canada ACa.TO, will wind up its operations, saying it plans to distribute its Air Canada shares and other assets to shareholders. [ID:N10340147]

DHX MEDIA DHX.TO

British audio and visual media group Entertainment One ETO.L says it dropped its proposal for a reverse takeover deal with Canada’s DHX Media Ltd. [ID:nBNG378531]

OIL RISES

Oil rose above $45 a barrel after the International Energy Agency predicted global growth in oil demand would resume in 2009 and the Saudi oil minister said OPEC’s top exporter pumped less oil than expected last month. [ID:nSIN361115]

GOLD, BASE METALS

Gold extends gains as the U.S. dollar weakens [ID:nLB505167], while base metals were lower ahead of U.S. jobs data. [ID:nLB437295]

HARRY WINSTON

Harry Winston Diamond Corp HW.TO swung to a third-quarter profit, thanks in part to a big foreign exchange gain as the Canadian dollar weakened against its U.S. counterpart, but it said the weak economy is hurting its business. [ID:N10350401]

CANADA POLITICS

Newly minted Canadian Liberal leader Michael Ignatieff warned Prime Minister Stephen Harper he is prepared to topple the minority Conservative government but he also opened the door to compromise. [ID:N10281251]

GLOBAL STOCKS

U.S. stock index futures extended losses on Thursday after a government report showed further deterioration in the labour market, while uncertainty over the bailout proposal for U.S. automakers weighed on sentiment. [ID:nN11378221] World stocks were mixed. [MKTS/GLOB]

CANADIAN RESEARCH

Goldman Sachs raises Domtar Corp UFS.TO to neutral from sell. [ID:nWNAB1668] For more research see: [CA-RCH] ($1=$1.23 Canadian) (Reporting by Jennifer Kwan, Editing by Chizu Nomiyama)

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