Trading promises to be rather light today, with U.S. markets closed for Thanksgiving.

Although European markets are giving strong positive guidance this morning, weak economic data locally may hamper a follow-on rally in Canada.

Canadian retail sales surprised to the downside this morning, dropping 1.7% in September. This is the largest monthly decline in more than three years. While the decline is partly related to the events of September 11, sales were also weaker before that. In constant dollars, retail sales looked even worse, down 2.3%.

In other news from Statistics Canada, foreign holdings of Canadian securities declined $7.2 billion in September largely due to the retirement of federal government bonds. Canadian investors sharply increased their holdings of foreign securities by $4.2 billion.

Crude oil prices are up almost 7% this morning, on hopes that Russia and Norway are going to go along with production cuts by OPEC.

In Europe, stocks are up led by telecoms such as Ericsson AB, Nokia Oyj and Alcatel SA. There is weakness in financials, after Fortis posted weak results. The FTSE is up 36 points to 5,349. The CAC 40 has gained 43 points to 4,600. The DAX is up 43 ticks to 5,129.

Overnight in Asia, stocks were positive, too. News that the Bank of Japan is considering buying foreign bonds to weaken its currency and help revive economic growth is improving the mood. The Nikkei gained 36 points to 10,697. The Hang Seng added 79 points to 11,253.

In M&A news, Merrill Lynch & Co. has a deal with CIBC to sell its Canadian retail brokerage and fund-management unit for between $475 million and $650 million.

Merger talks between Rhodia SA and Clariant AG have fallen through.

In earnings news, Compton Petroleum reports that cash flow for the third quarter was $20.8 million and quarterly net earnings amounted to $5.9 million.

Assante Corp. says its net loss for the quarter was $3.4 million, compared to $1 million for the third quarter of 2000. The loss is attributable to restructuring charges, increased amortization of capital assets and an increase in goodwill amortization.