Stocks are pointing to a higher open Thursday, with a flurry of reports ahead, including a key reading on U.S. economic growth, and merger activity in the banking sector.

The U.S. economy shot forward at an upwardly revised 5.3% annual rate in the first quarter, the fastest growth in 2-1/2 years, as companies built up inventories and exports strengthened, the U.S. Commerce Department said today.

First-quarter growth in gross domestic product was more than triple the 1.7% annual rate recorded in last year’s fourth quarter, though still slightly below Wall Street economists’ forecasts for a 5.7% pace.

Also due out are releases on U.S. initial jobless claims and personal consumption, and U.S. existing home sales.

The Canadian dollar opened at US89.74 cents, up 0.43 of a cent. On Wednesday, the loonie had risen 0.14 of a cent after the Bank of Canada boosted interest rates by a quarter-point but signalled a pause in its tightening cycle.

In earnings news, TD Bank reported its second-quarter profit rose to $738 million from a year-earlier $599 million.

In U.S. banking news, Regions Financial last night struck a US$10 billion deal to combine with its hometown rival AmSouth Bancorp, as the two Alabama banks gird for competition with national giants that are themselves growing larger. The combined Regions and AmSouth would become the 10th-largest bank in the United States as measured by market capitalization.

In M&A news, Canada Southern Petroleum Ltd. is urging shareholders to reject Petro-Canada’s $113 million takeover bid for the company.

Petro-Canada launched its unsolicited bid for Canada Southern on May 11, offering $7.50 a share.

German media conglomerate Bertelsmann has agreed to pay 4.5 billion euros (US$5.75 billion) to buy back a 25.1% stake in the company that Belgian investment group Groupe Bruxelles Lambert currently owns.

In other market news, Wal-Mart Stores was upgraded to “buy” from “neutral” at Banc of America Securities, with the brokerage raising 2006 and 2007 earnings estimates.

EBay was upgraded to “overweight” from “neutral weight” by Prudential Equity Group.


Crude-oil prices rose 14¢ to US$70 a barrel in early trading Thursday amid concerns about the approach of the summer driving and Atlantic hurricane seasons.

European stock markets edged higher after a flat start, while markets in Tokyo and Hong Kong were weaker.

Tokyo’s benchmark Nikkei 225 index lost 213.45 points, or 1.34%, to finish at 15,693.75 points.

In Hong Kong, the Hang Seng Index fell 125.75 points, or 0.79%, to 15,696.89.

Toronto stocks sank Wednesday on declining commodity prices, and despite indications from the Bank of Canada that the current cycle of rate hikes might end with today’s quarter-point increase

The S&P/TSX composite index fell 116.02, or 1.01%, to 11,423.91, after falling as far as 11,345.08 in intraday trading.

As the first of the so-called big six banks to report, Bank of Montreal announced a quarterly profit rose 7.1% to $644 million, and a boost to its quarterly dividend of 17%. BMO shares were off one cent at $61.50.

The S&P/TSX Venture composite index fell 90.55 points, or 3.21%, to 2,734.47.

In New York, markets ended somewhat higher on heavy and volatile trading, as investors absorbed negative economic news, but factored in lower commodity prices.

The Dow Jones Industrial average closed up 18.97 points at 11,117.32, above its intraday low of 11,030.47. The Nasdaq composite Index rose 10.41 points to 2,169.17, while the S&P 500 Index ticked up 1.99 point to 1,258.56.