August 21, 2008 / 1:15 PM / 10 years ago

Mixed open for Toronto stocks as oil, banks offset

*Investors to eye oil and gold price

*Concern about U.S. mortgage crisis to hit financial stocks

*Maple Leaf Foods in focus after recall

TORONTO, Aug 21 (Reuters) - The Toronto Stock Exchange’s main index is expected to open mixed on Thursday, supported by renewed interest in commodities, but any gains made by resource stocks may be trimmed by jitters over growing concerns over the U.S. mortgage crisis.

“When the commodities do well our oil and gas and gold stocks all do well,” said Douglas Davis, president at Davis-Rea.

The main index will probably open higher, building on Wednesday’s gains. But persistent concerns about mortgage giants Fannie Mae FNM.N and Freddie Mac FRE.N could sour the renewed interest in commodities, said Davis.

“Financials will continue to be under pressure until they devise some scheme to bailout the two big mortgage companies in the States,” said Davis.

Wall Street research analysts projected another bumpy quarter for U.S. investment banks due to more write-downs. For details, see [ID:nBNG271027]

On Bay Street, Canadian banks may see erratic activity ahead of quarterly results reports. The country’s six banks are expected to report lower quarterly earnings next week, reflecting weak capital markets activity, higher loan loss provisions and more write-downs.

In company news, Corel Corp CRE.TO could see action after sources said the digital media software maker has received multiple preliminary offers from private equity firms and strategic buyers. [ID:nN20461108]

Nortel Networks Corp NT.TO may draw attention after it said it has acquired DiamondWare to boost its virtual web and voice communications.

Maple Leaf Foods Inc (MFI.TO) announced a country-wide recall of packaged deli meats after some were found contaminated with listeria bacteria. [ID:nN20472780]

The S&P/TSX composite index .GSPTSE begins the day at 13,350.14, up 286.29 points, or 2.19 percent. The energy sector was the main springboard for the benchmark index on Wednesday, which surged 2 percent to its biggest advance in three weeks.

In New York, stock futures pointed briefly pared losses on jobs data, but were lower on concerns over more fallout from the credit crisis and as oil edged higher.

In economic news, higher gasoline prices pushed Canada’s annual inflation rate in July to a five-year high of 3.4 percent from 3.1 percent in June, Statistics Canada said on Thursday. Core inflation, which excludes gasoline and other items, stayed unchanged at 1.5 percent.

Oil muscled above $118 a barrel, up for a third straight session, on geopolitical tensions and a weaker U.S. dollar, while gold and some base metals were stronger. (Reporting by Jennifer Kwan; editing by Janet Guttsman)

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