News from Reuters

CA-BUSINESS Summary

08/01/09

Flaherty sees "substantial" deficit

WHITBY, Ontario (Reuters) - Canada will run a "substantial" budget deficit in the fiscal year starting on April 1, its finance minister said on Thursday, citing planned stimulus measures to respond to the world economic downturn. "Canada has certain needs and Canadians have certain needs in this extraordinary time of global recession. To fulfill those needs, we are going to have to run a substantial deficit, which we will do," Jim Flaherty told constituents in his electoral district near Toronto.

Bank of Canada hints at more rate cuts to come

TORONTO (Reuters) - The Bank of Canada hinted on Thursday that it would continue to lower interest rates this year but gave no indication of how deep the cuts would be as the global recession hits the Canadian economy. Deputy Governor Pierre Duguay said the bank continued to monitor developments in world markets to decide its next moves, amid market expectations of a rate cut on January 20.

Palm's new phone and operating system ignite shares

LAS VEGAS (Reuters) - Palm Inc overhauled its mobile operating system and introduced a new touch-screen phone, sending its shares soaring 35 percent as investors hoped the moves can help win back customers from rivals such as Apple Inc . The new products, which impressed analysts at the Consumer Electronics Show in Las Vegas on Thursday, were developed under the watch of former Apple executive Jon Rubenstein, who helped create the iPod and who was brought to Palm by its private equity shareholder, Elevation Partners.

Manulife knocks down report of accounting probe

TORONTO (Reuters) - Canadian insurance giant Manulife Financial forcefully rejected on Thursday a recent news report that U.S. state regulators were investigating its accounting practices. The company said in a press release that it has not been advised by any regulators -- and has no reason to believe -- that any of its accounting practices are being investigated.

Lehman deal on private equity close: source

NEW YORK (Reuters) - Lehman Brothers Holdings Inc has reached an agreement in principle to sell its merchant banking business, made up of two private equity funds, to management of the funds, a source familiar with the situation said on Thursday. The business to be spun out would also take in new investment from South African billionaire Johann Rupert, the source said. Lehman's bankruptcy estate will retain a substantial interest in the funds, the source said.

TSX closes up 1.1 percent as golds shine

TORONTO (Reuters) - Toronto's main stock index finished higher in a late-session burst on Thursday with the materials group boosted by strength in gold-mining issues as bullion prices rose. Financial and energy stocks were also modestly higher, helping to keep the overall index in positive territory. They started the day lower, contributing to the benchmark's sharp early drop.

Ontario Teachers' pension fund warns on options repricing

TORONTO (Reuters) - One of Canada's largest pension funds warned on Thursday that it did not want to see companies using the global stock market selloff as an excuse to reprice options it uses to pay executives. The Ontario Teachers' Pension Plan urged company boards and committees not to alter stock options or other equity-based compensation plans because of sagging markets.

Jaguar appeals TSX approval of HudBay-Lundin deal

TORONTO (Reuters) - Jaguar Financial is appealing a decision by the Toronto Stock Exchange to not force HudBay Minerals to hold a shareholder vote ahead of its planned takeover of Lundin Mining . The TSX gave conditional approval for the takeover in December, but Jaguar, a HudBay shareholder and vocal opponent to the takeover, has argued HudBay should be required to hold a vote of its own shareholders, in addition to getting approval from Lundin shareholders.

Loonie strengthens as data hits greenback

TORONTO (Reuters) - The Canadian dollar strengthened versus the U.S. currency on Thursday as the greenback retreated on weak U.S. economic data and investors braced for key monthly employment figures due on Friday. Bonds were slightly lower at the short end, but mostly higher at the long end of the curve with markets trading cautiously ahead of the jobs data.

Madoff had $173 million in checks ready, U.S. says

NEW YORK (Reuters) - Accused swindler Bernard Madoff had signed checks totaling more than $173 million in his office desk ready to be sent out before his arrest, U.S. prosecutors said in court papers on Thursday asking a judge to jail him. Prosecutors have said the checks were found by investigators searching Madoff's New York City office and that they showed the 70-year-old investment adviser wanted to move money to relatives and friends before his alleged fraud became known to authorities.

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