By James Langton

(May 4 – 13:00 ET) – Markets opened down about 75 points, after the U.S. jobs report came in much worse than expected. Once traders realized that meant likely future rate cuts, stocks rallied back. At midday, the TSE 300 is up about 15 points to 7,971.

Volume is average at 68.4 million shares. The up volume holds a nine to seven edge over the down volume, and winners outnumber losers by about nine to eight.

The TSE’s 14 sub-indices are evenly split between winners and losers. The strongest groups today are the energy stocks, up on price hikes, and the financials and real estate which are gaining on the promise of future rate cuts. Losers include paper stocks, merchandisers and utilities.

Among individual stocks, Nortel Networks is down 1.4% on volume of 4.7 million shares. Nortel is joined on the downside by a mixed bag, including Biomira, Aastra Technologies, Zi Corp., Enghouse, Creo Products and Canadian Southern Petroleum. Slocan Forest and Abitibi are leading the paper group lower. Co-Steel has dropped 16% on news of much weaker results in the last quarter.

Magin Energy is off a little in heavy trading after it was announced that royalty trust NCE Petrofund has made a friendly $266 million takeover offer for the firm. NCE will pay $5.86 in cash, or 0.896 of an NCE unit, for each outstanding shares of Magin.

On the upside, 360networks is bouncing back in heavy trading. Other gainers include Suncor Energy, Corus, Westport Innovations, Cogeco Cable, GSI Lumonics, Astral Media and AGF. All the big banks and insurers are up, although most of the fund companies are down.

In business news, Cognicase Inc says it has entered into an agreement with a syndicate of underwriters to issue and sell 2.5 million common shares at $8.25 per share, delivering gross proceeds of $20.63-million. The syndicate is being led by Yorkton Securities Inc. and the deal is scheduled to close on May 23.

In New York, the same trends have been observed. A deeply negative opening on the heels of the jobs report was reversed as traders started to imagine the rate cuts it might bring. At midday, stocks have recovered all the way, with the Dow Jones industrial average up 61 points to 10,858. The Nasdaq composite index is up 20 ticks to 2,166. The S&P 500 has gained eight points to 1,257.

The CDNX is the only loser today, down nine points to 3,091. Volume is heavy at 23.6 million shares. Mines are the weakest group, joined by minor slides in techs and oils. Entertainment Royalties is the top trader, flat at 15¢ on 3.2 million shares in its debut. New Blue Ribbon Resources is the second hottest stock, up 10% to 31¢ on volume of 2.2 million shares.