Markets are weaker at midday, as traders try to make sense of a barrage of corporate announcements. Out of the U.S., comes word of a new Treasury secretary, along with the big bankruptcy of United Airlines. Here at home, some fairly strong housing start numbers, and a big takeover offer in the insurance business have traders occupied.

At midday the S&P/TSX index is down 19 points to 65,58. Volume is on the light side at 104 million shares, with selling more than doubling the buying action. Market breadth is also quite negative, with losers overwhelming winners by a margin of 26:19.

Tech stocks are weighing on the index, down almost 5.5% on profit worries. There is also notable weakness in the diversifieds, industrials and consumer discretionary sectors. Energy stocks are stronger, as are financials and consumer staples.

The big trade today is Canada Life, up almost 33% on huge volume of almost 7 million shares. The market has pushed the firm’s stock to $41.70 per share, clearly betting that this morning’s surprise, unsolicited bid from Manulife Financial is going to be trumped by someone else, or raised by the folks at Manulife. Manulife shares are down about 4%. Canada Life has called the $6.4 billion offer insufficient.

The possible takeover of Canada Life by Manulife has also upped the takeover premiums on Kingsway Financial and Industrial-Alliance Life. Shares in those firms are up about 7% and 5% respectively.

Elsewhere in the financial group, Scotia is higher in active trading, as is Royal Bank. Bank of Montreal is lower on the day.

There is lots of other M&A action playing out today, apart from the big deal. APF Energy Trust’s purchase of Hawk Oil has Hawk’s stock up more than 29%. there is also buying in Cequel Energy, Canadian Natural Resources and Ultra Petroleum.

Also, Fording has filed an information circular explaining the enhancements to Fording’s proposed conversion into an income trust. The conversion into an income trust will result in shareholders being able to elect $34 in cash, one unit, or a combination of cash and units for each common share held. The total cash available to shareholders increases from $150 million to $795 million, and it creates a larger trust by adding the Teck Cominco coal assets.

Masonite International has purchased newly issued shares of Sacopan Inc. for approximately US$9 million to hold a 50% interest in the company. Sacopan is located in Sacre-Coeur, Que. It will remain an autonomous and independent entity.

Alimentation Couche-Tard has acquired Tabatout, a network of 30 stores in the province of Quebec that operates primarily by franchise. This acquisition is part of the company’s strategy to develop a network of stores located in high-traffic areas such as office buildings, shopping centres, airports and subway stations.

Away from all the M&A action, the downside is coming in the techs though, as traders worry that recent valuations are overdone and getting ahead of profit potential. Nortel Networks is down better than 12% on 29.3 million shares. There is also weakness throughout the sector, with selling in ATI, Celestica, Cognos, Research in Motion, Shaw and Rogers. CGI Group is up.

WestJet is down more than 13%, following the news of United’s long-awaited bankruptcy. Air Canada insists that its service will not be hurt by the move.

Moore Corp. is down about 16% on news that its CEO is out. The firm reiterated earnings guidance however.

In other business news, the patent infringement litigation between a subsidiary of American Online Inc., and Zi Corp. has been settled to their mutual satisfaction. The terms of the settlement agreement are confidential.

Also, Ballard Power has released a five-year plan that provides for a significant reduction in cash consumption, an organizational restructuring, a reduction of 400 employees, development financing for its next-generation fuel cell engine and the further commitment of its automotive alliance partners. It has obtained DaimlerChrysler and Ford’s preliminary agreement to provide combined financing of US$97 million over the next five years.

As part of the reorganization, Ballard will combine three of its four divisions into a single, functional organization. The combined headcount reductions will decrease Ballard’s employee base worldwide by about 400 employees to 1,000 employees. These changes will result in a restructuring charge of approximately US$15 million. Approximately US$12 million of the charge will be recognized in the fourth quarter of 2002.