Toronto stocks are rebounding a bit on news that Canada’s manufacturing industry is holding up much better than expected. The S&P/TSX composite index is 25 points higher at 7,600.

July manufacturing shipments rose by 1.7%, more than double what most economists were expecting.

South of the border, U.S. consumer inflation came in lower than expected suggesting the U.S. rates will remain low for some time. No one is expecting a rate cut at today’s Federal Reserve meeting, but market watchers are anticipating some direction from the Fed’s policy statement.

Toronto volume is fairly subdued ahead of the Fed decision, with 125.5 million shares changing hands. The volume favours buyers over sellers by a margin of 14:9. Market breadth is dead even though.

Techs are very strong today, gaining 3%, as optimism rebounds. There are also modest gains in health care and financials. These gains are being held in check by weakness in golds, real estate ad utilities.

Nortel is leading the tech group higher once again, rallying 6.7% in heavy trading of 23.3 million shares. The stock is being swarmed by the bulls amid news of new deals in China, that the firm has begun advertising once again, and word that Nortel has signed agreements with Orange SA to supply equipment to new 3G mobile phone networks in Europe.

Apart from Nortel, there’s not a lot of joy in the sector, although Geac is making solid gains.

.Mosaid Technologies revealed that it has closed its fabless semiconductor operation, and created a design licensing group in its intellectual property division. The restructuring actions include: work force reductions of 26 employees from the semiconductor division, and eight from supporting roles; the transfer of nine employees from the semiconductor division to the intellectual property division; and the recording of a restructuring expense of $4.9 million.

Biotechs are another matter, with some widespread gains in those stocks. ConjuChem is leading the way with a 7.6% gain on news that it cut its net loss for the third quarter to $6.7 million, compared with $9.4 million for the same period last year. There are also gains in names such as Vasogen, Stressgen Biotech, and TLC.


There is weakness in Barrick, Bema Gold and Nevsun Resources. Westaim is down, as is Fortis, CDI, Northbridge Financial and income funds, ACS Media, Associated Brands and Great Lakes Carbon.

On the upside, Sun Life is bouncing up by 1% today. There are also gains in Vincor, Major Drilling, Cinram, and Fairfax Financial.

In earnings news, Intrawest reported that its 2003 earnings dropped to US$34.2 million. Income from continuing operations for the year was $34.8 million (after taking a writedown of $12.3 million against technology assets) compared with $58.6 million in 2002.

In New York, traders are on Fed Watch. In the meantime though, stocks are rallying due to the inflation data today. The Dow Jones industrial average has added 43 points to 9,492. The Nasdaq composite index is 18 points higher at 1,864. The S&P 500 is six points stronger at 1,021.

The junior S&P/TSX Venture index is down eight ticks to 1,371. Volume is fairly robust at 30.6 million shares. Spider Resources is the day’s top trader, up 2¢ to 12¢ on 2.5 million shares.