By James Langton
(February 22 – 09:00 ET) – The Americans are back. Markets are open again in the U.S. this morning. U.S. Federal Reserve Board chair Alan Greenspan is back before the Senate banking comittee, although he’ll likely just reiterate last week’s hawkish testimony. Nevertheless traders will be watching.
Statistics Canada is reporting an 0.8 percent gain in month-over-month wholesale numbers, in line with analyst expectations. For 1999 wholesale trade grew twice as fast as in 1998, thanks to gains computers and other electronics, cars and lumber. Total wholesalers trade amounted to $361.2 billion, up 7.8% from 1998. For January the composite index was up 0.5%. This is down from December’s 0.8% growth. Business demand drove growth.
In Europe this morning stocks are bouncing back after a couple of down days. Telecoms are leading the gains, as is Unilever. The firm announced a cut of 25,000 jobs over five years, sending its stock higher. The German DAX is leading the way up, it has gained 92 points so far to 7,683. London’s FTSE is up 36.5 points to 6,118. France’s CAC 40 has added 37 points to 6,004.
A couple of big deals in important sector in Europe. Europe’s biggest paper firm, Stora Enso Oyj, is buying U.S. rival Consolidated Papers Inc. for US$4.9 billion in stock, cash and debt. Meanwhile phone giant SBC Communications is dropping US$3.9 billion in cash for Sterling Commerce Inc. The deal gives SBC electronic commerce software and service capacity.
In Asia stocks fell as political tensions rise. S&P has decided to leave Japan’s credit rating alone however, defusing that tension. But Chinese sabre-rattling toward Taiwan has traders nervous. There was apparently a rumour in Hong Kong that China could announce a timetable for reunification with Taiwan this year. The Nikkei closed down 153 points to 19,390. The Hang Seng dropped 67 points to 16,255.
In other business news yesterday’s whipping boy on the TSE, CINAR Corp., is announcing a llittle takeover. The firm which is in hot water over possible tax credit fraud is announcing the acquisition of Twin Sisters Productions, Inc., a U.S. children’s educational record label and publisher, for US$9 million in cash. Yesterday the firm lost about 26% after a late Friday evening press release about possible fraud related losses hit the market. Today U.S. traders will have a chance to weigh in.
Loewen Group Inc. has cut its losses, its quarterly net loss came in at just $5 a share, down from $8.22 per share last year. Saputo Group is reporting third quarter earnings of 50¢ per share, up from 41¢ last year.
Hot CDNX firm, Nexttrip.com Travel Inc., is announcing the appointment of
James Richard Warren as its new president and CEO.