TSX heads for positive open on hopes for Europe debt fix

Keywords Marketwatch Toronto stock market dips on weakness in the energy and financials sectors U.S. futures were weak with the Dow Jones industrial futures down five points to 12,107, the Nasdaq futures were down 5.8 points to 2,315.8 and the S&P futures slipped 2.6 points to 1,252.3. Sentiment got a late day boost Tuesday from a report that European leaders might create a second bailout fund to supplement the one they have already agreed to. The second fund would nearly double the capacity of Europe’s financial rescue programs, the Financial Times reported. But beyond creating a firewall that would raise the confidence of financial markets, investors are hoping that European leaders can agree on a long-term fix that would ensure that a similar debt crisis doesn’t happen again. French and German leaders have presented proposals this week that would see changes to existing European treaties that would centralize decision-making on spending and borrowing for the 17 countries that use the euro. The treaty proposal is set to form the basis of discussions at the EU summit in Brussels on Friday. At the same time, a split appeared to be developing on how to tackle the problem. Herman Van Rompuy, the president of the European Council, said an easier way to get agreement on future fiscal discipline would be to simply amend existing rules that apply to the 17 countries. But a senior German official, speaking on condition of anonymity, said the government of Chancellor Angela Merkel is insisting on either a substantial change to the treaty governing the 27 EU countries, or an entirely new treaty for the 17 countries that use the euro. Meanwhile, commodity prices headed lower with the January crude contract on the New York Mercantile Exchange down 29 cents to US$100.99 a barrel. Metal prices also backed off with the March copper contract down three cents to US$3.54 a pound. Bullion prices were also lower with the February contract in New York off $5.80 to US$1,726. In Asia, Japan’s Nikkei 225 jumped 1.7%, South Korea’s Kospi added 0.9% and Hong Kong’s Hang Seng gained 1.6%. Mainland Chinese shares edged higher, with the benchmark Shanghai Composite Index climbing 0.3% . European markets were generally weak as London’s FTSE 100 index slipped 0.12%, Frankfurt’s DAX was off 0.04% and the Paris CAC 40 added 0.18%. In corporate news, Bank of Montreal (TSX:BMO) is hiring the head of Metrolinx, the agency that operates GO Transit for the Ontario government, as its chairman. The bank says Robert Prichard, also a former CEO at Torstar Corp. (TSX:TS.B), will take the position after serving as an independent director of BMO since 2000. Prichard replaces David Galloway who is retiring. Cenovus Energy Inc. plans to spend between $3.1 billion and $3.4 billion in 2012 as it pushes forward with the expansion of its Christina Lake oil sands project. That’s about 23% higher than its capital spending budget for this year. Facebook LinkedIn Twitter Related news Malcolm Morrison Share this article and your comments with peers on social media TSX gets lift from financials, U.S. markets rise to highest since March The Toronto stock market was set to advance Wednesday on rising hopes that a mechanism to deal with the European government debt crisis will be arrived at by the end of the week. The Canadian dollar was slightly higher, up 0.06 of a cent to 99.11 cents US. S&P/TSX composite hits highest close since March on strength of financials sector

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