By James Langton

(June 13 – 13:00 ET) – Stock traders received evidence of a slowing economy this morning in the form of lower than expected retail sales in the U.S. but the markets have mostly failed to rally. Remarks from U.S. Federal Reserve Board chair Alan Greenspan later this afternoon continue to weigh heavily on the market, as does tomorrow’s consumer inflation report.

Nevertheless stocks are mildly positive. The TSE 300 is up 21 points to 9841. Volume remains light at 74.1 million shares, split almost dead even between buyers and sellers. Decliners are edging advancers 10:9.

On a sector basis only five of the TSE’s 14 sub-indices are up, but the all-important industrials are leading the way outpacing a broader decline. Joining techs on the upside are golds, cable stocks and energy producers. On the downside are telecoms, biotechs, financials, mines and forest products.

Despite all the selling Nortel Networks is up 2.5% on more than five million shares, driving the index higher. Nortel is fighting the good fight virtually alone, however. Other influential techs such as JDS Uniphase are slumping.

BCE is down 2%, joined by Teleglobe and BCE Emergis, Descartes Systems and Cryptologic. Biotech stocks are suffering some profit taking too, led by QLT Phototherapeutics and Angiotech. Lorus is the one biotech that’s on the upside after it received U.S. patents on an anti-cancer drug.

Merger news is moving some stocks too today. VERSUS is up another 14% in heavy trading on rumours that it may be taken over, with E*Trade Group in the U.S. tipped as the most likely suitor.

Golds are also rolling on the news that Franco-Nevada is set to take over Gold Fields for $2.7 billion. Franco is sliding 2% on the news, but it is boosting other names such as Placer Dome and TVX Gold.

In New York traders also took surprisingly little comfort in this morning’s retail sales report. A choppy morning trade is currently on the downside. The Dow is off nine points to 10555. The NASDAQ has slipped 28 points to 3740. The S&P 500 has gained seven points to 1453.

Small caps are sliding modestly, too. The CDNX is off seven points to 3465 on light volume of 14.4 million shares. Energy stocks are up while miners and techs continue to slide. Consolidated A.M.R. Corp. is the leading trader, up 12% to 9¢ on 762,998 shares traded.