The Canadian Press

The Toronto stock market could be under pressure from the energy sector at the open as oil prices continue to decline amid Chinese moves to curb bank lending and a report showing an unexpected jump in U.S. inventories.

The Canadian dollar moved up 0.54 of a cent to US96.67¢.

U.S. futures pointed to a slightly higher open following a negative session Tuesday amid an earnings report from aluminum giant Alcoa Inc. that missed expectations.

The Dow Jones futures rose 10 points to 10,598, the Nasdaq futures climbed 3.75 points to 1,869.25 while the S&P 500 futures were ahead 2.8 points to 1,136.7.

The crude contract for February delivery declined 74¢ to US$80.05 a barrel after data released late Tuesday by the American Petroleum Institute showed distillate inventories increased 3.6 million barrels last week, while analysts had expected a drop of 1.7 million barrels.

Crude fell almost US$2 a barrel Tuesday in the wake of China’s decision to raise the proportion of deposits that banks must hold in reserve by half a percentage point, starting from next Monday. The People’s Bank of China also raised the yield it is offering on its one-year bills, its second increase in interbank markets in a week.

“In the week that data showed it had eclipsed Germany as the world’s largest exporter, the desire of policymakers to reel in liquidity by pushing one year yields higher and (raising) banks’ reserve requirements has sparked worry that the stimulus led component of the Chinese recovery is set to be choked off,” said Stuart Bennett, an analyst at Calyon Credit Agricole in London.

China has helped support the global economy during the recession and investors are worried it may not be such a big motor of growth in the months ahead, especially if interest rates start to rise, too.

Metal prices revived following slides on Tuesday as the February bullion contract on the New York Mercantile Exchange rose $5.90 to US$1,135.30 an ounce. March copper added 2¢ to US$3.37 a pound.

Overseas, Hong Kong’s Hang Seng slid 2.6%, and in mainland China, the Shanghai benchmark tumbled 3.1%.

Japan’s Nikkei 225 stock average fell 1.3% with Japan Airlines down another 81% — on top of Tuesday’s 45% collapse — as investors worried about an imminent bankruptcy filing.

London’s FTSE 100 index inched up 0.15%, Frankfurt’s DAX rose 0.34% while the Paris CAC 40 was ahead 0.18%.

On the corporate front, auto parts maker Magna International Inc. (TSX:MG.A) says it expects its 2010 sales to be in a range of US$19.5 billion to US$20.5 billion, in line with 12 analyst estimates compiled by Thomson Reuters.

Corus Entertainment Inc. (TSX: CJR.B) reported a $73.9-million profit in its fiscal first quarter, an 82% improvement that came as advertising revenues began to rebound in November. The Toronto-based television and radio company’s net earnings amounted to 91¢ per share, on a diluted basis, up from 50¢ per share or $40.6 million a year earlier.

Corus says its revenues also rose to $222.3 million from $216.8 million a year ago.

Cogeco Cable Inc. (TSX:CCA) says it’s raising most of its financial targets for 2010 as a result of steady performance at its Canadian operations and signs that its European subsidiary is stabilizing after a period of intense competition.

The Montreal-based company says quarterly revenue was $317.4 million, up 6% from a year earlier. Net income was $56.7 million, about half of it from a favourable income tax adjustment. Excluding that special item, Cogeco’s net income would have been $26.9 million, up $3.9 million or 17.2% from $22.9 million in a year earlier.

Investors also examined Google Inc.’s threat to withdraw from China. The company said it will no longer censor its search results in the country after finding that computer hackers had led human-rights activists to reveal their e-mail accounts to outsiders. Google’s public complaints were a rare show of protest in the country and an about-face for the company after long saying it would abide by Chinese laws that block some political and socially sensitive content.