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Reuters Canada Business Summary

18/07/07

Canada inflation stays above target in June

OTTAWA (Reuters) - Canadian consumer prices unexpectedly fell in June, but that is unlikely to deter the Bank of Canada from raising interest rates in September, analysts said on Wednesday, as the annual inflation rate stayed well above target. A 0.2 percent drop in the consumer price index in June may give the central bank a little breathing room in its anti-inflation battle and lessens the need for an aggressive round of rate hikes. The bank raised its key overnight target by 25 basis points to 4.50 percent last week, ending the longest pause in three decades.

Shoppers profit jumps 19 pct, same-store sales up

OTTAWA (Reuters) - Shoppers Drug Mart , Canada's biggest drug store chain, said on Wednesday its second-quarter profit jumped 19 percent on healthy sales growth. For the quarter ended June 16, Shoppers said it earned C$112 million ($107.7 million), or 52 Canadian cents a share. That is up from a profit of C$94 million, or 44 Canadian cents a share, in the same period last year.

CP Rail says Brookfield inquired, but no talks

VANCOUVER, British Columbia (Reuters) - Canadian Pacific Railway Ltd. said on Wednesday it rejected an "inquiry" from Brookfield Asset Management Inc. , and denied it was in discussions about a takeover of one of North America's largest railways. CP, whose corporate roots run deep in Canadian history and folklore, said the inquiry from Brookfield -- reported to be leading a private equity consortium -- was made earlier this year and was "highly conditional," seeking exclusive negotiations and due diligence.

Chrysler scraps plans for new Imperial luxury car

DETROIT (Reuters) - Chrysler Group has scrapped plans for a luxury sedan that would have represented a bigger, heavier and less-fuel-efficient version of its Chrysler 300C, citing high gasoline prices and tougher fuel economy standards. Chrysler said on Wednesday that it was dropping production plans for the Imperial, a high-riding luxury sedan that prompted comparisons with the Rolls-Royce Phantom.

Rail stocks up on Canadian Pacific bid report

CHICAGO (Reuters) - North American railroad stocks rose on Wednesday following a report that a private equity consortium plans to bid for Canadian Pacific Railway Ltd.

Alcan agrees to sell Utkal alumina venture stake

MONTREAL (Reuters) - Alcan Inc. said on Wednesday it agreed with Hindalco Industries Ltd to sell its 45 percent interest in the Utkal Alumina International Ltd. joint-venture. Alcan, the target of a friendly $38 billion takeover offer from Rio Tinto Plc , said in April that it planned to sell the stake in Utkal.

Toronto stocks up on CPR talk, strong commodities

TORONTO (Reuters) - The Toronto Stock Exchange's main index was higher on Wednesday morning, pulled up by a report of a possible private equity buyout of Canadian Pacific Railway Ltd. and supported by strong commodity prices. The S&P/TSX composite <.GSPTSE> was up 29.86 points, or 0.2 percent, at 14,411.87.

Oil rises after surprise fall in U.S. gasoline stocks

LONDON (Reuters) - Oil rose more than a dollar on Wednesday, after U.S. government data showed an unexpected fall in gasoline inventories and a bigger-than-forecast drop in crude oil stocks, reinforcing concerns over tightening supplies. London Brent crude, seen as a better gauge of global markets than U.S. oil, rose $1.24 to $76.77 a barrel by 1541 GMT, after falling 76 cents the previous day. It hit a $78.40 peak on Monday, near a record high last August.

High River says Burkina Faso mine pours first gold

OUAGADOUGOU (Reuters) - Canadian-listed High River Gold Mines Ltd has poured its first gold at its Taparko-Bouroum mine in Burkina Faso, the company said on Wednesday. The company said output from the mine was expected to total approximately 60,000 ounces in 2007, and 100,000 ounces over its first 12 months of production, rising to 140,000 ounces in its third year.

Canadian dollar falls on CPI, bonds mixed

TORONTO (Reuters) - The Canadian dollar was softer versus the greenback on Wednesday, as an unexpected fall in inflation dented expectations for the number of future interest rate hikes by the central bank. Domestic bonds prices were mostly higher after the data.

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