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Reuters Canada Business Summary

24/07/08

TSX sink 2 percent as financials drag

TORONTO (Reuters) - The Toronto Stock Exchange's main index sank more than 2 percent on Thursday in a broad decline sparked by losses in financial-services shares as sour data highlighted concerns over the U.S. economic outlook. Agnico-Eagle Mines was among the biggest decliners by weight, losing 7.8 percent, after it reported a weaker than expected quarterly profit, a lower production outlook for the year, and warned of a jump in project costs over the next two years.

Air Canada and Continental ink code-sharing pact

TORONTO (Reuters) - Air Canada aims to expand its reach to new destinations through a partnership with Continental Airlines that will put the carriers' passengers on each other's planes while maintaining their frequent flier benefits, it said on Thursday. The proposed code-sharing deal would offer Air Canada passengers more options for connecting flights while keeping its own operating and marketing costs down against a backdrop of soaring fuel prices, the country's biggest airline said.

Oil prices seen masking Canada "export recession"

OTTAWA (Reuters) - Oil prices will continue falling and dip below $100 a barrel by the end of this year, unmasking an "export recession" in Canada that will result in anemic growth, a government export agency said on Thursday. Export Development Canada forecast export growth this year of 4.2 percent in terms of value. But that is an artificially pretty picture based entirely on the dramatic surge in oil prices, EDC said in its quarterly Global Export Forecast.

Canadian bank profits vulnerable, analyst says

VANCOUVER, British Columbia (Reuters) - While it may be tempting to argue that the worst is over for Canadian bank stocks, several factors could still put pressure on earnings growth at the banks, an analyst said on Thursday. "We maintain our cautious view on Canadian bank stocks," RBC Capital Markets analyst Andre-Philippe Hardy said in a research note.

Suncor profit rises with oil prices, targets cut

CALGARY, Alberta (Reuters) - Suncor Energy Inc , Canada's No. 2 oil sands producer, said on Thursday that record crude prices boosted second-quarter profit by 12 percent, even as production fell and it lowered its output targets. Suncor said net income rose to C$829 million ($820.7 million), or 89 Canadian cents a share, from C$738 million, or 80 Canadian cents, a year earlier.

Ford posts $8.7 billion second-quarter loss on truck slump

DETROIT (Reuters) - Ford Motor Co posted a record $8.7 billion quarterly loss on Thursday as it wrote down the value of slumping truck and SUV operations and revamped plans in a bid to break its reliance on the gas-guzzlers that have been its franchise vehicles for a decade. The second-quarter loss was deeper than analysts had forecast and Ford shares fell by 15 percent. Its bonds also traded lower.

Teck turns to windmills, C$ hedges to fight costs

TORONTO (Reuters) - Teck Cominco has entered currency hedges and is considering wind power in order to gain short-term control of costs that have shot higher for mining companies, the diversified miner said on Thursday. In the longer term, the company believes its holdings in Canada's oil sands will help offset future energy price gains.

Canada's Globalive to buy Telehop Communications

TORONTO (Reuters) - Globalive Communications, a privately held Canadian telecom firm that secured wireless spectrum across the country in a recent auction, said on Thursday it will buy cut-rate long distance company Telehop Communications for about C$10.7 million ($10.6 million). Buying Toronto-based Telehop will complement Globalive's own Yak brand, which provides cheap long-distance service to about one million users.

Canada building to spend C$6.2 billion in Ontario

TORONTO (Reuters) - Canada's federal government gave the struggling economy of Ontario a shot in the arm on Thursday, agreeing to invest about C$3.09 billion ($3 billion) in infrastructure projects, a sum that the province will match. Spending by Ontario, Canada's manufacturing heartland, will bring the total investment to $6.2 billion for improving roads, bridges, transit and other infrastructure. The funding arrangement will run until 2014.

Hedging loss masks operating gains at EnCana

CALGARY, Alberta (Reuters) - EnCana Corp said on Thursday its second-quarter profit fell 16 percent on an unrealized loss on forward natural gas sales contracts, but surging gas prices and production pushed operating results at Canada's biggest energy company above expectations. EnCana, which is preparing to split into two separate oil and gas producers by early next year, also increased its forecast for 2008 cash flow by about 7 percent to as much as $11 billion as its gas business exceeds its projections.

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