MARKET ACTIVITY/TRADING NOTES FOR DAY ENDING MONDAY, MARCH 9, 1998 (1)
Tuesday, March 10, 1998
Bay Street surpassed its Oct. 7 record on expectations that interest rates will hold steady. Wall Street slipped slightly as investors sold computer company shares
Canadian stocks rallied to a record as the market's benchmark index finally eclipsed the highs set five months ago. Wall Street weakened as investors sold technology issues and bought consumer-oriented stocks.
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The Toronto Stock Exchange 300 composite index rose 42.45 points, or 0.6%, to 7228.06, surpassing the previous record close of 7209.93 on Oct. 7. Earlier, the index set a record intraday high of 7228.60 before easing.
"Net foreign buying of Canadian investments has lifted the C$, as well as the stock and bond markets, on expectations that interest rates will remain stable as the economy grows at a non-inflationary rate," said Philip Strathy of Strathy Investment Management Ltd. About 110.6 million shares traded, up from 101.7 million shares Friday.
BCE Inc. (bce/tse), which has the heaviest weighting in the benchmark index, rose 80› to $53.20 on expectations that a rising C$ may convince the Bank of Canada to leave rates unchanged.
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Canadian Imperial Bank of Commerce (cm/tse) rose $1.30 to $45.45, Bank of Montreal (bmo/tse) gained 85› to $77.25 and Toronto Dominion Bank (td/tse) advanced 65› to $60.55 to send the financial services subgroup higher on expectations of stable rates.
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Avenor Inc. led forest products issues higher after Bowater Inc. agreed to acquire the forest-products company, topping a hostile Abitibi-Consolidated Inc. Avenor (AVR/TSE) rose $2.45 to $33.40 and was the most active issue, with 9.8 million shares changing hands.
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The TSE forest products sub-group accounted for 10.7 points of the TSE 300's advance.
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Alcan Aluminium Ltd. (al/tse), which accounts for 1.7% of the benchmark index, rose $1.80 to $47.05 after Aluminum Co. of America said it will buy Alumax Inc., combining the largest and third-largest aluminum producers.
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Alcoa's decision raised expectations Alcan, the second largest producer, may also make an acquisition to remain competitive.
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Petro-Canada (pca/tse) fell 30› to $25.95 and Imperial Oil Ltd. (imo/tse) fell $2.20 to $81.55 to lead energy issues lower after crude oil fell 3% to a four-year low.
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In other Canadian markets, the Montreal Exchange portfolio rose 21.92 points, or 0.6%, to a record close of 3690.72.
The Vancouver Stock Exchange composite index lost 1.9 points, or 0.3%, to close at 628.63.
For a scorecard of trading activity on all Canadian Stock Exchanges, go to:
quote.yahoo.com .
REFERENCE: Canadian Market Summary
canoe2.canoe.ca
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On Wall Street, stocks retreated as investors sold computer companies that warned of disappointing earnings and bought Sears, Roebuck & Co. and consumer products makers regarded as more consistently profitable.
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The Dow Jones industrial average fell 2.25 points to 8567.14. About 630 million shares traded on the Big Board, down from 669.8 million shares on Friday. The Standard & Poor's 500 composite index dropped 3.38 points, or 0.3%, to 1052.3.
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The tech-heavy Nasdaq composite index fell 28.33 points, or 1.6%, to 1725.16 after Compaq Computer Corp. joined Intel Corp. and Motorola Inc. in warning that it would fall short of earnings forecasts.
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"For the past several years, the tech stocks have really led this rally," said Bradley Turner, senior managing director at Gradison-McDonald Asset Management in Cincinnati. "The seriousness of the situation probably set in a little more today."
Beverage, drug, retail, household product and cosmetics companies gained. Investors are buying shares expected to benefit as U.S. unemployment hovers at a 24-year low and low interest rates let people buy goods on cheaper credit, refinance their homes and spend the extra money at the shopping mall. Sears (s/nyse) jumped US$31 1/84 to US$58.
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"It's been a very volatile market, and you want to be a little defensive," said Thomas Keresey, chairman and chief investment officer of Palm Beach Investment Advisers Inc.
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Major overseas markets were mostly higher.
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London: The FT-SE 100 rose 36 points, or 0.6%, to 5818.9.
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Frankfurt: German stocks maintained their momentum, with the Dax index adding 64.88 points, or 1.4%, to 4780.83.
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Tokyo: The market fell despite a comment from a senior ruling party official that he wants a new economic package after April. The Nikkei average closed at 16,972.53, down 159.44 points, or 0.9%.
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Hong Kong: Stocks recovered from early losses to close slightly higher in cautious trading as investors focused on the growing tension between Indonesia and the International Monetary Fund. The Hang Seng index rose 74.56 points, or 0.7%, to 10,994.09.
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Sydney: The Australian market followed the U.S. lead. The all-ordinaries index closed at 2680.7, up 13.1 points, or 0.5%.
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Regulators poised to approve electronic filings for insiders
By CLAUDIA CATTANEO- Calgary Bureau Chief The Financial Post
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Up-to-date insider trading reports could soon be available across Canada if provincial securities commissions implement a new Internet-based system of reporting trades.
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The technology would be one of the first innovations of Canada's emerging "virtual" national securities commission, expected to be officially set up in Quebec City in early April through a memorandum of understanding between provincial securities heads.
"I suspect work will start on it shortly," Bill Hess, chairman of the Alberta Securities Commission, said yesterday. "I would expect that within the next few months, work will commence to implement the various proposals, including going out for proposals for the insider trading system."
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A report by Coopers & Lybrand, commissioned by the technology committee of the Canadian Securities Administrators, an association of securities regulators, recommends a national insider reporting system be based on Web technology. It would capture and process information filed by corporate insiders and publish it on a Web site.
The system would make insider trading information, which is now filed and compiled manually, accessible almost instantly even if provincial insider trading laws remain the same.
It would also provide a better mechanism for securities regulators to monitor trades and a framework for a more consistent approach to handling insider trading reports.
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"Certainly, you can set it up so that if information is late or it doesn't balance, we can actually get an exception report, rather than the time-intensive process of wading through the written reports manually," Hess said.
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"Once we have the technology, we would immediately make recommendations to governments to shorten the prescribed time period."
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Investors monitor insider trades on the assumption people in high positions within a company have better information about its fortunes than is publicly available.
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Insider trading laws are inconsistent from province to province and a sore point among market watchers.
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Corporate insiders must declare trading activities within 10 days in Alberta and Quebec, but in Ontario and British Columbia they can wait until 10 days after the end of the month.
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Some jurisdictions circulate bulletins on insider trades, others simply record them.
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Commissions rarely enforce their own rules, with the result many insider trades are reported months, even years, after the fact. Usually, commissions act only on complaints or reviews generated by other activities.
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"The extent of the disclosure is certainly adequate, but the timing is quite appalling," said John Bart, president of the Canadian Shareholders Association. "This move will improve access to that information."
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