August 31, 2010 / 1:05 PM / in 7 years

CANADA STOCKS-TSX set to open lower on soft growth, commodities

Aug 31 (Reuters) - Toronto’s main stock index looked set to open lower on Tuesday, hurt by soft commodity prices and weaker-than-expected Canadian growth data that increased fears about the strength of the economic recovery.

FACTORS TO WATCH

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

* Canada’s economic growth rate slowed more sharply than expected in the second quarter on weaker consumer spending and trade performance, fueling expectations the Bank of Canada’s rate hikes will be gradual. [ID:nN31202447]

* U.S. stock index futures were lower on Tuesday as investors awaited data on housing and consumer confidence to gauge the pace of the economy recovery. [.N]

* European stocks were down around midday on Tuesday, on track to record their sixth monthly loss this year, as investors fretted about lingering worries over the health of the U.S. economy ahead of key macroeconomic data.

* Asian stocks were lower with Nikkei tumbling 3.6 percent, as investors grew more concerned that officials were not going to halt the relentless rise in the yen, which has gained 11 percent since May.

COMMODITY PRICE MOVES

* The Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, fell 0.44 percent in early trade.

* U.S. crude oil fell below $74 a barrel on Tuesday and was heading for its first monthly decline since May, pressured by stockpiles and concern about the strength of economic growth and future demand. [O/R]

* Gold eased in Europe on Tuesday as a rally that took the precious metal to two-month highs last week ran out of steam, but ongoing concerns over the health of the financial markets supported prices near $1,235 an ounce. [GOL/]

* Copper fell on Tuesday as nervousness over the pace of recovery reigned ahead of a slew of key U.S. data due this week, but losses were limited as investors bet the Federal Reserve will stimulate growth. [MET/L]

CANADIAN STOCKS TO WATCH

* Bank of Nova Scotia BNS.TO: Canada’s third-largest bank said on Tuesday its third-quarter profit rose 13.9 percent as the bank sharply reduced its money set aside to cover bad loans. [ID:nN31226185]

* Research In Motion RIM.TO: RIM will give India access to secure BlackBerry data beginning Sept. 1, a government source said on Monday, leading New Delhi to put off a decision on whether to shut down the smartphone. [ID:nSGE67U02I]

* Magna International Inc MGa.TO: An Ontario appeals court ruled on Monday that the auto parts company’s proposed buyout of founder Frank Stronach’s controlling shares can go ahead, Canada’s Globe and Mail reported. [ID:nN30203272]

* Enbridge Inc ENB.TO: The company tested the integrity of a pipeline it repaired after a rupture spilled heavy crude into a Michigan river system, and regulators will use the results to determine if it is ready to resume deliveries, a spokeswoman said on Monday. [ID:nN30183571]

* Manulife Financial MFC.TO: Manulife filed a mixed shelf offering of up to C$10 billion ($9.4 billion) with Canadian and U.S. regulators on Monday, replacing an existing C$10 billion shelf that was filed last year in Canada only. [ID:nN30189884]

* MagIndustries Corp MAA.TO: The company said on Monday it was re-assessing other options for its Congo potash mine as China’s Complant 000151.SZ, which had agreed to buy a majority stake in the project, was yet to get approval for the deal. [ID:nSGE67T0LJ]

* Capstone Mining Corp CS.TO: The copper miner said on Monday it saw a 44 percent increase in estimates for contained copper at four undeveloped deposits at its Minto mine in Yukon. [ID:nSGE67T0L2]

* RioCan Real Estate Investment Trust REI_u.TO: The REIT said on Monday it would raise C$124.5 million in a public offering of trust units to mainly fund acquisitions. [ID:nSGE67T0L0]

* Olympus Pacific Minerals Inc OYM.TO: The Canadian gold producer said its only gold-producing plant, Bong Mieu, in central Vietnam was reopened on Thursday after a one-day shutdown due to an incident of vandalism and theft. [ID:nSGE67T0L5]

ANALYST RECOMMENDATIONS

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

* First Quantum Minerals FM.TO target price cut to C$155 from C$165; rating strong buy at Raymond James

* Methanex Corp MX.TO rating raised to strong buy from outperform at Raymond James

* RioCan REIT REI_u.TO rating cut to market perform from outperform at Raymond James

$1=$1.06 Canadian Reporting by Bangalore newsroom, editing by Bhaswati Mukhopadhyay and Jeffrey Hodgson

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