Canadian Stocks Holding On To Early Gains, Still Up 80 Pts; Buoyed By Telecom and Info Tech, Stymied By Metals & Mining


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Canadian stocks notched up 80 points in gains inside the first 30 minutes of trade today and have largely held on to them since, led by strong gains for telecom stocks on positive sentiment after they posted encouraging results last week. Info Tech stocks are also performing well, led by Blackberry (BB.TO) after an investment firm raised the possibility of it being sold. The Metals & Mining sector is the sole loser with oil prices fluctuating and gold lower as investors and traders wait to see what impact tomorrow's FOMC minutes will have on the U.S. dollar.

In economic news, wholesale sales fell 0.9% in December to $49.0 billion following a 0.7% gain for Canadian economy in November. StatisticsCanada said the decrease was largely a result of lower sales in the computer and communications equipment and supplies industry. The same industry was behind November's increase.

Also, non-residents reduced their holdings of Canadian securities by $1.9 billion during December, led by large retirements of bonds and equities. Meanwhile, Canadian investors added $5.5 billion of foreign securities to their portfolios, the fourth straight month of investment.

Blackberry (BBRY) is up 3% but off day highs on the Toronto Stock Exchange although Canaccord Genuity cut its expectations for February quarter BB10 smartphone shipments from 1.75 million units to 300,000 units, various Internet sources and BNN TV in Canada reported Tuesday.

Wrapping up the reports, Canaccord reportedly said Blackberry may eventually be forced to sell some of its assets, or the whole company, or at least become a niche supplier. It reportedly said sum of parts analysis valued BlackBerry at near $4.71 Billon versus a market cap of near US$7.3 billion on the NASDAQ and C$7.7 Bln on the Toronto Stock Exchange. Canaccord reportedly reiterated its sell rating and $9 price target.

In company news, Westport Innovations (WPRT, WPT.TO) are up more than 1% but $1 off day highs for a second straight day of gains. Takeover speculation lifted the stock to a 7.9% advance during Friday's session. Cummins Inc. ( CMI ) was identified as the likely suitor, possibly paying as much as $42 per share, according to reports. The two companies already are participating in a joint venture combining CMI's expertise with fuels systems, controls and other components with WPRT's natural gas-powered drive-trains for large trucks.

But analysts at JPMorgan today reiterated their Neutral rating for WPRT shares, writing in a new research note that a potential deal was "highly unlikely," adding the suggested takeover price makes little sense.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

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