Markets are backing off earlier gains, as the opening enthusiasm fades, and the latest news about the anthrax scare drifts in.

At midday the TSE 300 is still up 32 points to 6,937. Volume is stronger today at 75.7 million shares, with buyers holding a four to three edge on sellers. Winners outnumber losers nine to eight.

On a sector basis, transports are powering higher, financials are rebounding, as are industrials and miners. There’s spotty weakness in media stocks, pipelines, real estate and auto parts.

Techs are generally up today, with Celestica and Nortel Networks leading the way. JDS Uniphase, Telesystem International Wireless, Microcell, GT Group Telecom and Ballard Power are up notably. There’s accompanying weakness in BCE and Bell Canada International.

The banks are also back today after the central ban cut rates 75 basis points, surprising almost everyone. CIBC is leading the trade, but there’s also some strength in Bank of Nova Scotia and Royal Bank. Among the insureres, Clarica is also bouncing back.

Other gainers include PanCanadian Energy, CP Rail, CN Rail, Hemosol and Moores.

The downside is more targeted, with losses in Air Canada, Transat, QLT, Cryptologic, Quebecor and Placer Dome.

The earnings deluge continues with news that Co-Steel reported a net loss of $30.2 million, compared with earnings of $6.1 million in the third quarter of 2000.

Weyerhaeuser had third quarter net earnings of $91 million that include non-recurring after-tax items of $6 million. This compares with net earnings of $199 million for the same period last year.

Also, AEterna’s loss increases to $5,008,000 in third quarter. Cogeco earns $1.93 million in its fourth quarter. Wescast reports a net loss of $9,772,000 in its third quarter.

In other news, George Weston has completed the sale of 4.2 million shares of Loblaw Companies as previously announced. The sale was by means of a secondary offering at $48.50 per share though a syndicate of underwriters led by CIBC World Markets Inc.

Labopharm has filed a preliminary prospectus to issue 4 million common shares at $6.75 per share for gross proceeds of $27 million to a syndicate of underwriters led by Research Capital Corp. and including CIBC World Markets Inc., National Bank Financial Inc. and TD Securities Inc.

In New York, markets opened higher and held up throughout the morning, until the latest anthrax news hit. U.S. health officials are confirming that two postal workers have died of inhaled anthrax and there are numerous other exposures.

The added uncertainty seems to have spooked traders. At midday, the Dow Jones industrial average is down 16 points to 9,361. The Nasdaq composite index is still up 13 points to 1,721. The S&P 500 is down a point to 1,089.

The CDNX is holding up today, too, gaining four points to 2,929. Volume is on the light side at 11.5 million shares, led by oils. Fas International Ltd is the top trader, up 29% to 9¢ on 488,500 shares.