By James Langton

(April 17 – 09:15 ET) – Economics are front and center today, although an earnings warning from Cisco Systems may ultimately be more important.

Nevertheless, the Bank of Canada cut interest rates 25 basis points as expected this morning. The move was priced into markets and shouldn’t rattle markets, although some economists had predicted a 50 bps move.

In the U.S., the March Consumer Price Index was reported up 0.1%, and the core rate was up 0.2%. The inflation numbers were more or less in line with expectations and shouldn’t do anything to deter further rate cuts in the United States.

But all of this may mean little in the face of the news that Cisco Systems, the world’s largest networker won’t make its numbers this quarter or next. That announcement has sparked skepticism regarding most other tech stocks. Cisco also said it will cut 8,500 jobs and take charges of up to US$3.7 billion this quarter. The company blamed slow capital spending for the shortfall.

And the job losses keep on rolling. Europe’s largest consumer-electronics maker, Royal Philips Electronics NV, said it will cut up to 7,000 jobs. Eastman Kodak Co. will fire up to 3,500 workers.

All this negative news has U.S. futures down and European stocks off. Philips and European telecoms such as Nokia Oyj and Ericsson AB are leading the slide. In London, the FTSE is down 96 points to 5,670. In Paris, the CAC 40 has dropped 131 points to 5,241. Germany’s DAX has dumped 148 points to 5,854.

Overnight in Asia, stocks were slugge, too. The Japanese Nikkei shed 188 points to close at 13,067. In Hong Kong, The Hang Seng surrendered 383 points to close at 12,606.

In earnings news, IPSCO Inc. announced today that its first quarter net income was US$8.5 million, down 33% from the fourth quarter of 2000, and down 51% from the same quarter a year ago.

Weyerhaeuser Co. reported first quarter net earnings of US$107 million, or 49¢ a share, including a nonrecurring after-tax charge of $26 million associated with the decision to outsource certain information technology services. Excluding the charge, first quarter 2001 earnings were 61¢ a share. This compares with $1.04 a share for the first quarter of 2000.