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Reuters Canada Business Summary

29/08/08

Canada skirts recession in second quarter

OTTAWA (Reuters) - Canada's economy grew by a weaker-than-expected 0.3 percent in the second quarter, narrowly avoiding the common definition of a recession, as global demand waned for Canadian exports such as autos, forestry products and machinery. Gross domestic product shrank 0.8 percent in the first quarter, revised from the original estimate of a decline of 0.3 percent, Statistics Canada said on Friday.

BCE and Telus to announce wireless pact: report

OTTAWA (Reuters) - BCE Inc , Canada's biggest telecom company, and Telus Corp , the country's No. 2 phone company, will share the cost of a next-generation wireless network upgrade, the Financial Post newspaper said on Friday. The paper said that BCE and Telus are expected to announce next week an upgrade to high speed packet access networks, estimated to cost as much as C$1 billion ($1.05 billion).

Wal-Mart cuts staple food prices in Ontario

NEW YORK (Reuters) - Wal-Mart Stores Inc said on Friday it would cut prices on bread, milk, butter and eggs in its Ontario stores as part of a wider campaign of reductions to help shoppers in a tough economy. Wal-Mart Canada cut hundreds of prices on goods in August and plans to reduce hundreds more in September.

TSX set for mixed open on oil and data

TORONTO (Reuters) - The Toronto Stock Exchange's main index was set for a mixed open on Friday, as a surge in energy stocks on rising oil could be offset by weak Canadian economic data, and on thin trading activity ahead of the Labour Day long weekend. Canada's economy grew by a weaker-than-expected 0.3 percent in the second quarter, Statistics Canada said on Friday, narrowly avoiding the common definition of a recession as demand for its exports waned.

Oil rises to $117 on storm threat to U.S. output

LONDON (Reuters) - Oil rose by more than $2 above $117 a barrel on Friday, as Tropical Storm Gustav was poised to enter the Gulf of Mexico, raising concerns about its impact on U.S. offshore oil and gas output. Energy companies braced for Gustav, shutting down production and evacuating personnel from offshore rigs. The U.S. Gulf of Mexico is home to a quarter of U.S. crude oil production and 15 percent of its natural gas output.

Google to go ahead with Yahoo deal: report

(Reuters) - Google Inc. , facing a U.S. Justice Department probe of its search-advertising partnership with Yahoo Inc. , will proceed with the agreement by early October, Bloomberg said. "We are going to move forward," Google Chief Executive Eric Schmidt said in an interview with Bloomberg Television on Thursday in Denver.

Microsoft to buy ciao.com price comparison firm

LONDON (Reuters) - Microsoft has agreed to buy Greenfield Online , owner of European price comparison website ciao.com, for about $486 million to boost its Internet search and e-commerce business in Europe. Microsoft, whose $47.5 billion bid to buy Yahoo earlier this year failed after a protracted battle, said on Friday the acquisition should benefit its Live Search platform.

Loonie trims losses after GDP data

NEW YORK (Reuters) - The Canadian dollar trimmed losses versus the U.S. dollar on Friday after a government report showed Canada's economy expanded 0.3 percent in the second quarter. In morning trading in New York, the U.S. dollar was 0.1 percent higher at C$1.0514, from C$1.0525 before the release.

Zoom Airlines grounds planes and files for bankruptcy

CALGARY, Alberta (Reuters) - Zoom Airlines, a Canadian discount transatlantic carrier stung by sky-high fuel costs, canceled all flights and began bankruptcy proceedings on Thursday, stranding passengers at several airports. Ottawa-based Zoom said it had tried until midday Thursday to secure a financial lifeline that would keep it aloft after rising jet fuel prices added $50 million in annual costs.

RBC has "aggressive but disciplined" M&A approach

TORONTO (Reuters) - Royal Bank of Canada is looking at potential acquisitions in U.S. personal and commercial banking "with a tremendous amount of caution," President and Chief Executive Gord Nixon said on Thursday. "As everybody is aware, certainly valuations in the U.S. have dropped very dramatically, although the U.S. marketplace is not without its challenges," Nixon said on a conference call, citing U.S. real estate in particular.

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