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CA-BUSINESS Summary

10/10/08

Panic strangles Asia stocks; yen firm

HONG KONG (Reuters) - Asian stocks plunged on Friday, with Japan's Nikkei down more than 10 percent, while the yen and U.S. Treasury debt prices rose, as panic set in after global efforts so far failed to unlock credit markets. A synchronized cut in borrowing costs by central banks around the world this week was seen as too little, too late, and investors doubted a meeting of the Group of Seven rich nations later on Friday could achieve much, with fears growing that the global economy is headed toward recession.

Pressure on G7 to act on crisis as Asia stocks plunge

HONG KONG (Reuters) - The world's economic powers came under pressure to act boldly to halt financial distress as panic selling clenched Asian markets on Friday and anxiety spread over an expected global economic recession. With financial policy makers from the Group of Seven (G7) major industrial nations due to meet in Washington later in the day, bank bailouts, liquidity injections and interest rate cuts across the world have failed to quell investor fears.

Toronto stocks dive amid confidence crisis

TORONTO (Reuters) - The main index of the Toronto Stock Exchange plunged almost 5 percent on Thursday as mounting gloom over the state of the economy and the U.S. financial sector sent investors fleeing the market in a broad rout. The financial sector was the biggest drag on the benchmark, sliding 7.74 percent. The energy and materials groups -- the other two pillars that buttress the Toronto market -- failed to lend support, shedding 5.03 percent and 2.47 percent, respectively.

Oil tumbles $4 to one-year low, crisis unrelenting

SINGAPORE (Reuters) - Oil tumbled more than $4 to a one-year low on Friday as growing fears that financial market turmoil will squash demand for fuel outweighed the possibility of an OPEC production cut at an emergency meeting in November. Commodities have been punished along with stock markets as investors fear that government invention and a first round of rate cuts will fail to stave off a global recession as the financial crisis marches resolutely into a second month.

U.S. weighs backing bank debt, deposits: reports

SYDNEY (Reuters) - The U.S. government is weighing guaranteeing billions of dollars in bank debt and temporarily insuring al U.S. bank deposits, in a bid to unfreeze bank lending and staunch massive losses in equity markets, The Wall Street Journal reported on Friday. The New York Times reported that U.S. and British officials were converging on a similar blueprint to stem financial chaos involving injections of government money into banks in return for ownership stakes and guarantees of repayment for various types of loans.

CEO says listeria in Toronto meat plant no surprise

WINNIPEG, Manitoba (Reuters) - Maple Leaf Foods Inc Chief Executive Michael McCain said on Thursday it was not surprising to find listeria bacteria lingering in a Maple Leaf meat plant in Toronto whose products have been linked to at least 20 deaths in a food-poisoning outbreak. "Listeria exists in 100 percent of all (meat) plants, and it is impossible to eliminate it," McCain told reporters, noting the company sanitizes its plants for six to eight hours a day to reduce the risk of the bacteria contaminating food at levels high enough to cause illness or death.

Job creation seen slowing in September

TORONTO (Reuters) - The pace of job creation in Canada is expected to have slowed in September, and that trend will likely worsen in coming months as the credit crunch bites, analysts polled by Reuters say. The September employment figures will be released on Friday morning and the average forecast of the 24 analysts surveyed by Reuters is for a gain of 9,000 jobs, down from August's 15,200 increase. The unemployment rate is expected to tick up to 6.2 percent from 6.1 percent in August.

Global crisis hits Japan financial sector

TOKYO (Reuters) - The global economic crisis claimed its first Japanese financial institution on Friday and the government looked to prop up smaller banks, as Tokyo shares flirted with their biggest one-day fall since the 1987 market crash. Escalating bankruptcies in the property sector and among small businesses, along with fears of a global recession, have dragged Japan's export-dependent economy into the crisis, sending blue chip shares sliding by a quarter so far this week.

Biovail faces suit that it misled investors

TORONTO (Reuters) - Biovail Corp said on Thursday that a new class action lawsuit that claims that it misled investors concerning an anti-depressant formula were "without merit" and that it plans to "defend itself vigorously." The class action suit, which was filed recently in a New York area court, claims that Biovail misled investors about the regulatory approval status of its BVF-033 treatment, a salt formulation version of the generic antidepressant Wellbutrin XL.

LS Power withdraws TransAlta takeover proposal

CALGARY, Alberta (Reuters) - LS Power Equity Partners said on Thursday it scrapped plans for a C$7.8 billion ($7 billion) takeover of TransAlta Corp as shares in the Canadian power producer languished well below the bid price. LS Power and Global Infrastructure Partners, which own 9 percent of TransAlta, offered to buy the company in July for C$39 a share, saying it could achieve its expansion goals more easily as a private company.

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