August 21, 2012 / 12:26 PM / 5 years ago

CANADA STOCKS-TSX may open higher on optimism over euro zone

Aug 21 (Reuters) - Canada’s main stock index looked set to open higher as markets remain optimistic that strategy being drawn up by the European Central Bank would help tackle the region’s debt crisis.

TOP STORIES

* China’s leading offshore oil producer CNOOC Ltd said its first-half net profit fell by almost a fifth - twice as much as the market had expected - and it cut its dividend by 40 percent to make room for its $15.1 billion acquisition of Canadian oil firm Nexen Inc.

* Glencore’s $30 billion bid for miner Xstrata is not a “must-do deal” its chief executive said, in the company’s strongest suggestion yet that it will not yield to key shareholder Qatar’s demands for an improved offer.

* Spain’s short-term borrowing costs dropped at auction as investors bet the European Central Bank will intervene on bond markets, but a lack of detail over when and how it will act meant yields remained punishingly high.

* Britain’s government finances veered further off track in July after a shortfall in corporation tax revenues and higher spending led to an unexpected deficit in a month that normally has strong tax receipts.

* Japan’s Elpida Memory, which failed earlier this year, said it had submitted a restructuring plan to the Tokyo District Court, as expected following its agreement to be bought by U.S. chipmaker Micron Technology Inc.

MARKET SNAPSHOT

* Canada stock futures traded up 0.2 percent

* U.S. stock futures , , were up around 0.2 to 0.3 percent

* European shares, were up

COMMODITY PRICE MOVES

* Thomson Reuters-Jefferies CRB Index : 306.25; rose 0.49 percent

* Gold futures : $1,624.9; rose 0.3 percent

* US crude : $96.68; rose 0.74 percent

* Brent crude : $114.49; rose 0.69 percent

* LME 3-month copper : $7,546.5; rose 1.21 percent

CANADIAN STOCKS TO WATCH

* Heritage Oil : The company will sell part of a gas block and borrow money from Genel Energy Plc to raise $450 million, easing concerns about how it will fund oilfield purchases in Nigeria.

ANALYST RECOMMENDATIONS

Following is a summary of research actions on Canadian companies reported by Reuters.

* Encana : SogGen cuts to sell from hold

* Enerplus : CIBC ups target to C$15 from C$14.50 after the company sold 8 percent stake in Laricina for C$141 million

* Franco-Nevada : RBC cuts to sector perform from outperform, says the agreement on Inmet’s Cobre Panama project is unlikely to give near-term cash flows

* Pershimco Resources : NBF starts with sectorperform and a price target C$1.00 to reflect the junior gold developer stage of the company which may take time to catch up with valuation

* Pure Energy Services : Canaccord Genuity cuts to hold from buy, says the company’s share price of C$10.93 after acquisition by FMC Technologies, results in limited upside to the C$11.00 target price

ON THE CALENDAR

* Major Canadian economic data includes wholesale trade

* Major U.S. events and data includes Redbook chain store sales

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