The commodity-linked Canadian currency made a big push higher this morning on a rise in global commodity prices. Leading the charge were crude oil, which shot up to a nine-month high, gold and base metals. With a GDP report on deck, the markets may be looking at considerable volatility going into the weekend.
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Headlines[/U][/B]:
- [B]Strong Loonie Puts Halt To Increases In Factory Price Index[/B]
The 0.5 percent month-on-month decline in the Canadian Industrial Product Price Index for May put a halt to a six-month period of rising prices. The Canadian dollar?s steady advance has eroded weighed on the price of factory goods, in particular motor vehicles, by the largest amount since September 2006. Reduction in the prices of crude oil and ferrous metals led to a 0.2 percent decline in the price index of raw materials dropped in May. http://www.reportonbusiness.com/servlet/story/RTGAM.20070628.wstatscanprices0628/BNStory/robNews/home - [B]Gold Meridian Inc Stock Rallies After Takeover Offer
[/B]Canadian equity markets advanced Thursday as news of mergers and acquisitions activity in the gold mining sector led to record gains for Meridian Gold Inc. The gold mining company received a $3.06 billion bid, a 23 percent premium over yesterday?s closing price, for a joint venture with gold producer Yamana Gold Inc.
Bloomberg - Are you a robot? - [B]Pension Funds Turn to Private Equity for Greater Returns
[/B]The three-largest pension fund managers in Canada intend to inject more capital into private-equity investments since returns from stocks and bonds are inadequate to fulfill the requirements of retirees.
Bloomberg - Are you a robot?
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[U]Canadian Market Action[/U][/B]:
[B]Currency Market - USD/CAD:[/B]
The commodity-linked Canadian currency made a big push higher this morning on a rise in global commodity prices. Leading the charge were crude oil, which shot up to a nine-month high, gold and base metals. The Canadian dollar rose to an almost two-week high as it cleared 1.0600 against the US dollar by the end of the North American session. Growing speculation of a possible BoC rate hike based on the seemingly unflappable strength of the economy has led the currency to an annual gain of 9.8 percent against the U.S. dollar. The loonie saw an equally impressive rally against the Japanese yen after a rebound in global equity markets lured investors towards the carry trade trend.
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Equity Market - S&P/TSX Composite Index[/B]:
Since its recovery yesterday from a three-session period of triple-digit decline, Toronto?s S&P/TSX composite index has possibly reinitiated its bear trend with a moderate 0.19 percent loss on a 26.25 point dip to 13,715.67. Though the index ended the day lower, it spent much of the day in the green with the help of speculation over mergers and acquisitions activity, as Meridian Gold Inc. shares rose 17 percent after the gold mining company received a bid that represented a 23 percent takeover premium.
[B]Fixed-Income Market - 10-year Government Bond Yields:[/B]
Canada?s benchmark 10-year bond yield increased to 4.632 percent, up more than 1 basis point. The modest global rally in yields on government debt comes after a period of declines set in motion after turbulence in the US subprime mortgage arena affected the risk appetite of investors worldwide.
