Canada Shares Climb amid Rate Cut Hopes
Canada's benchmark TSE 300 index closed up 51.70 points, or 0.7%, to 7741.40, on Wednesday as the Bank of Canada's monetary policy report update suggested that passive interest-rate cuts still are the most likley scenario on August 28 -- when the central bank annouces its policy decision. A 25-basis-point ease is currently priced along the Government of Canada yield curve. Royal Bank of Canada rose after agreeing to buy financial-services firm Tucker Anthony Sutro for C$956 million ($625 million) in cash. Tech stocks Celestica and Nortel rose after Merrill Lynch's upgrade of select chip stocks. But the TSE's inability to move higher highlighted some of the market's underlying weakness, and Standard & Poor's thinks this week's rally could very well be a bear trap.
European markets ended mixed. In London, the Financial Times 100 Index was up 17.80 points, or 0.32%, to 5,546.90. France's CAC 40 Index gained 26.97 points, or 0.53%, to 5,112.48. But Germany's DAX Index shed 18.27 points, or 0.31%, to end at 5,842.92.
Asian markets closed higher following a rally on Wall Street Tuesday. The Nikkei gained 98.56, or 0.83%, to close at 11959.33. In Hong Kong, the Hang Seng added 162.05, or 1.32%, to close at 12478.74.