Stock markets look to open higher

By Staff | February 11, 2010 | Last updated on February 11, 2010
3 min read

The Toronto stock market could be headed for a higher open on Thursday as commodity prices advanced ahead of the open and the president of the European Union announced a deal to help Greece with its huge debt.

However, investors were cautious about the deal announced by EU president Herman Van Rompuy since it gave no sign of solid financial backing.

“Those expecting an announcement of money being thrown at Greece today may well be disappointed,” Credit Agricole analysts said in a note.

The Canadian dollar rose 0.56 of a cent to 94.63 cents US.

U.S. futures indicated a higher open with the Dow Jones industrial average ahead 30 points to 10,015, the Nasdaq futures climbed 6.25 points to 1,751 and the S&P 500 futures were ahead 4.7 points to 1,068.

Van Rompuy said only that countries that use the euro are ready to take “co-ordinated measures” if necessary to help Greece stave off default.

Stock markets have headed lower in recent days on worries that Greece’s debt levels have become unsustainable.

Greece’s fiscal problems have shaken the euro, a currency used by 16 European countries, and underscored the interconnectedness of the global economy.

Investors were also concerned that other European countries such as Spain and Portugal also face serious debt issues.

The TSX could find support from higher oil prices as the March crude contract on the New York Mercantile Exchange gained 74 cents to US$75.26 a barrel.

The April bullion contract on the Nymex rose $3.10 to US$1,079.40 an ounce while March copper was ahead five cents to US$3.04 a pound.

Oveseas, China’s Shanghai index was up 0.1% while Hong Kong’s Hang Seng index jumped 1.9%. Japanese financial markets were closed for a national holiday and will reopen Friday.

Analysts, however, warned against reading too much into the day’s gains.

Linus Yip, a strategist at First Shanghai Securities in Hong Kong, said trading volume was extremely low, with many investors holding back ahead of the Lunar New Year holidays next week.

London’s FTSE 100 index rose 0.65%, Frankfurt’s DAX gained 0.11% and the Paris CAC 40 added 0.02%.

Investors also took in earnings from Canada’s big life insurance companies.

Sun Life Financial said on Thursday that quarterly profit more than doubled to $296 million or 52 cents a share in the last quarter of 2009. However, that’s less than the 65 cents a share that analysts expected.

Earnings from Manulife Financial and Great-West Lifeco Inc. will also be released during the day.

On the retail front, Canadian Tire Corporation Ltd. reported that its net income for the fourth quater came in at $96.2 million, down from $101.5 million a year earlier. Operating revenue in the 13 weeks ended Jan. 2 was $2.44 billion, down from $2.59 billion in a 14-week quarter ended year earlier.

Yellow Pages Income Fund said its net income in the fourth quarter rose 24% to $124.6 million or five cents a share. However the Montreal-based publisher of advertising directories added its fourth-quarter revenue fell 4.7% compared with a year earlier to $405.7 million.

Sierra Wireless, Inc. reported a loss of US$2.7 million in its latest quarter, weighed down by restructuring costs and the costs of integrating its Wavecom acquisition. The results and the company’s earnings guidance missed analyst expectations.

U.S. data that was to be released Thursday were postponed because of two major snowstorms that have shut down the federal government in recent days. The Commerce Department will delay, at least for one day, reports on monthly retail sales and business inventories.

For this morning’s market data tables, click here.

(02/11/10) staff


The staff of have been covering news for financial advisors since 1998.