Canadian Headlines

The Canadian dollar fell together with oil prices as tomorrow?s EIA report was projected to show an increase in oil inventories. Oil, together with other commodities, account for about 50 percent of Canadian exports, linking the Canadian currency to price movements in commodity futures. Additional damage was inflicted on the Loonie as the US Federal Open Market Committee is scheduled to meet today to set interest rates.

Flight simulator company CAE contracted 60 million worth of US, German, British, and Canadian aircraft related work. CAE president Marc Parent remarked, "Our continued success with the U.S. navy is a perfect example as the navy has seen first-hand our helicopter simulation expertise and experience for both flight and rear crews."
http://www.cbc.ca/money/story/2007/08/07/cae-contracts.html
[I]Source: CBC[/I]
Molson Coors Brewing Co., brewer of Molson Canadian and Coors light, posted higher than expected second quarter profits as a result of higher North American sales. Net income rose to US$185 million, or US$2.04 per share, compared with last year?s US$156.2 million, or US$1.81 per share.
http://www.canada.com/nationalpost/financialpost/story.html?id=8fe79a9b-206c-42c1-8689-de6c0ea81d7c&k=39040
[I]Source: Financial Post[/I]
Connors Bros. Income Fund delayed a monthly payment to investors because of costs from recalling canned food that may be contaminated with bacteria. The company’s stock was down as much as 21 percent.
http://www.bloomberg.com/apps/news?pid=20601082&sid=aMa4oZOI4nHE&refer=canada
[I]Source: Bloomberg[/I]
[B]Currency Markets: USDCAD[/B]
The Canadian dollar fell together with oil prices as tomorrow?s EIA report was projected to show an increase in oil inventories. Oil, together with other commodities, account for about 50 percent of Canadian exports, linking the Canadian currency to price movements in commodity futures. Additional damage was inflicted on the Loonie as the US Federal Open Market Committee is scheduled to meet today to set interest rates. If post decision rhetoric provides any further indications of an economic slowdown for Canada?s biggest trade partner, the country?s exports may be affected. The Canadian dollar was last quoted against the US dollar at 1.0550.


[B]Equity Markets: S&P/TSX Index[/B]
Coming off a long weekend, the S&P/TSX stumbled on declining energy shares. After oil dropped yesterday for the most in several months, investors speculated an economic slowdown in the US will continue to decrease demand for oil. Energy producers Petro-Canada and Talisman Energy Inc. dropped C$1.92 and 62 cents respectively. In the communications sector, Telus shares dropped C$1.82 to C$55.68 after Friday?s report showed second quarter earnings missed analysts? expectations. The S&P/TSX was most recently quoted down 53.70 points at 13,511.54.


[B]Fixed Income Markets: Canadian Government 10-Year Bond[/B]
As Canadian equity markets begin another week with losses, investors flocked to risk free government securities. With Canadian exporters being largely dependent on oil prices, yesterday?s more than US$3/bbl decline in oil shook up the Canadian equity markets, arousing investor concerns of an economic slowdown. Government bonds have become a safe haven from recent volatility seen in the equity and credit markets. The 10-year government bond was most recently quoted at 96.286, yielding 4.47 percent.