February 28, 2011 / 2:08 PM / 7 years ago

CANADA STOCKS-TSX set to open higher after firm GDP, Lundin bid

Feb 28 (Reuters) - Toronto’s main stock index looked set to open higher on Monday after stronger-than-expected Canadian growth data and the launch of a C$4.8 billion ($4.9 billion) bid for Lundin Mining LUN.TO.

FACTORS TO WATCH

* Canadian equity futures <0#SXF:> pointed to a higher open.

* Canada’s economy revved back to life in late 2010 after a bout of lackluster growth, supporting expectations the central bank will resume interest rate hikes in the first half of this year. [ID:nN28244249]

* U.S. stock index futures were higher after bullish comments from a Federal Reserve official about the economy, easing concerns that high oil prices could hurt economic activity. [.N]

* European shares edged up , with agrochemical stocks lifted by positive comments on the sector from Bayer, more than offsetting falls in heavyweight HSBC following forecast-lagging results. [.EU]

* Asian shares rose as financial shares clawed back some of last week’s losses but gains were capped by fears of further outflows from emerging equities to developed markets.

COMMODITY PRICE MOVES

* The Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, rose 0.19 percent in early trade.

* Oil prices turned lower as reassurances from Saudi Arabia that extra supply needs had been met soothed market fears over the spread of protests to oil-producer Oman. [O/R]

* Gold rose above $1,410 an ounce in Europe as turmoil in the Middle East region lifted safe-haven buying and fuelled a fresh spike in oil prices, stoking concerns over U.S. growth and knocking the dollar.[GOL/]

* Copper rose, extending a rally on Friday, after an earthquake struck top producer Chile and the dollar fell, but gains were capped by concerns about the effects rising oil prices will have on economic growth. [MET/L]

CANADIAN STOCKS TO WATCH

* Equinox Minerals EQN.TO: The copper miner launched a C$4.8 billion unsolicited bid for Canada’s Lundin Mining LUN.TO, a move that may scuttle a proposed C$9 billion tie-up between Lundin and Inmet Mining and kick off a bidding war for the base metal miner. [ID:nN27203451]

* Vermilion Energy Inc. VET.TO: The oil and gas company’s fourth-quarter profit fell 87 percent hurt in part by higher expenses. [ID:nL3E7DS18E]

* Quadra FNX Mining Ltd. QUX.TO: The miner reported a 25 percent rise in fourth-quarter profit, helped by record high copper prices and an increase in production from the combined Quadra and FNX asset base. [ID:nL3E7DS14L]

* Western Copper WRN.TO: The company said on Friday the Yukon Supreme Court has ruled that the territory’s water board does have the authority to refuse a water use license, even if a mining project has been screened by the Yukon Environmental and Socio-Economic Assessment Board. [ID:nN25185071]

* Pure Technologies Ltd. PUR.V: The company, which provides technology that monitors the soundness of major structures such as bridges and pipelines, said recent events in Libya are likely to affect its business in the short term. [ID:nL3E7DS11F].

ANALYST RECOMMENDATIONS

Following is a summary of research actions on Canadian companies reported by Reuters. [RCH/CA]

* Algonquin Power & Utilities AQN.TO price target raised to C$6 from C$5.50; rating buy at TD Newcrest

* Distinction GD.TO target price raised to C$3.75 from C$3.50; rating buy at LB Securities

* Enerplus Corp. ERF.TO price target cut to C$34 from C$35; rating hold at TD Newcrest

* Groupe Aeroplan AER.TO price target cut to C$17.50 from C$18; rating action list buy at TD Newcrest

* Toromont Industries TIH.TO target price raised to C$38 from C$36; rating outperform at Raymond James

* Wajax Corp. WJX.TO price target raised to C$44 from C$40; rating buy at TD Newcrest

$1= $0.98 Canadian Reporting by Shrutee Sarkar, editing by Jeffrey Hodgson

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