TSX May Open Higher Amid Rebounding Energy

Tomahawk, WI 10/5/2011 (PennyPayDay) – Bay Street stocks may open higher Wednesday as energy prices rebounded from yearly lows and European equities moved higher amid speculation European Union officials are examining how to recapitalize the region's banks. Meanwhile, the IMF said Europe requires about $266 billion to recapitalize banks and has asked the ECB to step up response efforts and cut interest rates if risks persist.

Moody's Investors Service cut Italy's credit rating, saying that chronically weak growth will make it difficult to reduce the nation's debt and noted that the region's debt crisis boosts financing costs. Moody's lowered Italy's rating three levels to A2 from Aa2, with a negative outlook.

On Tuesday, the S&P/TSX Composite Index extended losses for a third sessions, shedding 73.92 points or 0.66 percent to 11,177.91.

The price of crude oil was rebounding from its one-year low Wednesday morning as traders await cues from the official crude oil inventories data from the EIA, due out later during the session. Analysts expect crude oil inventories pile up by 2.50 million barrels and gasoline stocks to add 1.30 million barrels last week. Crude for November gained $1.85 to $7.52 a barrel.

The price of gold moved up, with gold for December adding $11.50 to $1,627.50 an ounce.

In corporate news from Canada, Scotiabank announced that it has been designated, as a Primary Dealer by the Federal Reserve Bank of New York, through its New York Agency.

Diversified upstream oil and gas company Talisman Energy Inc. announced resumption of production at its Rev facility in Norway, which was shut due to maintenance of the gas export line from the host platform. The company expects cumulative impact of these one-time, unplanned events to reduce its North Sea production by approximately 13,000 boe/d during the third quarter and 7,000 boe/d during the fourth quarter.

Gold miner Kirkland Lake Gold reported a much improved first quarter profit before tax at C$7.9 million or C$0.32 per share compared to C$3.0 million or C$0.04 per share a year ago.

Infrastructure focused investment company Capstone Infrastructure said it acquired a 70 percent interest in Bristol Water, which is a regulated water utility in UK, from SUEZ ENVIRONNEMENT through its unit, AGBAR, for around C$215 million.

From south of the border, the ADP said that private sector employment rose by 91,000 jobs in September following a downwardly revised increase of 89,000 jobs in August. Economists had expected employment to increase by 75,000 jobs compared to the addition of 91,000 jobs originally reported for the previous month.

In economic news from the euro zone, a report from Eurostat revealed retail sales in the euro zone declined in August on weak non-food product sales. Retail sales were down 0.3 percent month-on-month in August, reversing a 0.2 percent rise in July. The August figure came in line with economists' expectations.

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