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CA-BUSINESS Summary

06/10/08

TSX cuts losses after 10 percent slide

TORONTO (Reuters) - The Toronto Stock Exchange's main index was down nearly 5 percent by late Monday morning, as it managed to regain some ground after posting its biggest intraday drop since October 1987 Shortly after 11:20 a.m. EDT, the S&P/TSX composite index <.GSPTSE> was down 613.19 points, or 4.68 percent, at 10,190.16, with all 10 main groups in the red. Earlier in the day the TSX had been down about 1,100 points, or more than 10 percent.

Economy to stall out by next summer: Scotiabank

TORONTO (Reuters) - There will be little, if any growth in the Canadian economy until the end of next summer and that will pave the way for lower interest rates, a leading Canadian economist said on Monday. Scotiabank Chief Economist Warren Jestin, speaking at an event along with other economists from Canadian banks, said financial problems will continue to radiate out of the United States and add stress to other economies.

Oil drops below $90 on demand concerns

NEW YORK (Reuters) - Oil dropped more than $4 to below $90 a barrel on Monday on expectations the growing financial crisis will further slow already faltering global fuel demand. U.S. crude traded down $4.40 to $89.48 a barrel at 12:09 p.m. EDT after earlier touching $88.89, the lowest level since early February. London Brent crude fell $4.50 at $85.75 a barrel.

Energy stocks slump on credit woes

CALGARY, Alberta (Reuters) - The Toronto Stock Exchange's energy index <.SPTTEN> dropped to its lowest level in more than three years on Monday, as falling crude prices and the credit crunch hammered Canadian oil stocks. The TSX energy index fell 27.46 points, or 9.9 percent to 248.33 by midday after earlier touching 230.25, its lowest point since May 2005.

Construction industry retreats in August

OTTAWA (Reuters) - The Canadian construction industry pulled in its horns by more than expected in August, as the value of building permits fell by 13.5 percent from July, according to Statistics Canada date released on Monday. The nonresidential sector fell 19.3 percent after double-digit increases in April and May, while the residential sector dropped by 9.3 percent, after a 4.0 percent rise in July.

Purchasing activity quickens in September

TORONTO (Reuters) - Purchasing activity in the Canadian economy expanded in September, and at a faster pace than the previous month, according to the Ivey Purchasing Managers Index released on Monday. The index, the joint project of the Purchasing Management Association of Canada and the Richard Ivey School of Business, rose to 61.0 in September from 51.5 in August.

Scotia buys C$2.3 billion CI stake from Sun Life

TORONTO (Reuters) - Bank of Nova Scotia said on Monday it will buy Sun Life Financial's stake in fund manager CI Financial for C$2.3 billion, giving the bank a coveted boost in the wealth management area and providing Sun Life with funds to go after acquisitions. The cash deal for 104.6 million CI units at C$22 per unit will make Scotiabank the biggest shareholder in the country's third-largest mutual fund company, with a 37.6 percent ownership stake. It will immediately increase Scotiabank's profit, executives said.

Dollar at weakest vs greenback in 1-1/2 years

TORONTO (Reuters) - The Canadian dollar fell to its weakest since May 2007 against a rallying U.S. dollar on Monday, as concerns about the global financial crisis put a bid to the greenback and undercut commodity prices. Bond prices rose as investors looked for a safe place to park their cash as equity markets tumbled.

Connacher shelves Montana refinery expansion

CALGARY, Alberta (Reuters) - Connacher Oil & Gas Ltd said on Monday it is shelving a planned expansion of its Montana refinery in order to concentrate on boosting output from its Canadian oil sands holdings. Connacher, one of the smallest oil sands producers, has abandoned a scheme to raise capacity at its Great Falls, Montana, refinery to 35,000 barrels per day from 9,500.

EU pledges crisis action as U.S. urges coordination

LONDON/WASHINGTON (Reuters) - The European Union pledged on Monday to protect people's savings and maintain financial stability while Washington urged a more coordinated approach to the worst banking crisis in nearly 80 years. Amid criticism of a fragmented EU response, French President Nicolas Sarkozy issued a statement from the 27 member states saying individual countries would do all they could to safeguard the financial system.

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