Toronto's main stock index looked set to open higher on Monday, supported by a rise in Nexen Inc and Progress Energy Resources Corp after the Canadian government approved takeover bids for the energy companies.
The S&P/TSX composite index gained 8.64 points to end Friday at 12,159.77. Canada stock futures traded up 0.1%
The Canadian dollar faded 0.04 cents to 101.26 cents U.S. Monday morning.
An increase in commodity prices after a rise in factory output in China also boosted investor sentiment.
Canada approved China's biggest foreign takeover, the $15.1-billion bid by CNOOC Ltd for energy company Nexen Inc but drew a line in the sand against future acquisitions by foreign state-owned enterprises.
Russia's Nord Gold will increase its ownership of Toronto-listed subsidiary High River Gold to 97.9% under a share offer that could boost its free float and take it a step further to a premium London listing.
Precision Drilling Corp. expects capital expenditure to almost halve in 2013 as weak natural gas prices slow drilling activity. The company forecast capital expenditure of $485 million for 2013.
On the economic calendar, Canada Mortgage and Housing Corporation reported this morning that the pace of housing starts fell in November for a third straight month.
The agency says there were 17,646 actual starts last month, which translates to a seasonally adjusted annual rate of 196,125 units, down from 203,487 in October.
ON BAYSTREET
The TSX Venture Exchange finished 0.64 points shy of breakeven at 1,186.06
ON WALLSTREET
Investors will be cautious heading into the week, amid a fresh bout of uncertainty over Europe and ongoing fiscal cliff negotiations in Washington.
The Dow Jones Industrials futures added two points to 13,145, while S&P 500 futures gave back 0.4 points to 1,415.60, and futures for the tech-rich Nasdaq shed 3.5 points, or 0.1%, to 2,632.50.
Apple shares were bouncing back, following last week's nearly 9% slide.
Best Buy shares declined after the stock was downgraded by Bank of America analysts.
Shares of McDonald's gained ground after the fast food chain said global same-store sales, a key metric, rose 2.4% in November, led by sales growth in the United States.
Over the weekend, Italian Prime Minister Mario Monti unexpectedly announced plans to step down after parliament passes a national budget later this month.
The news sent Italian stocks plunging and the yield on the Italian 10-year bond rising to 4.82% from 4.5% last week. Investors are worried that Monti's resignation could throw a wrench into Italy's plans to bring down its high levels of debt.
European stocks were dragged lower Monday, and the selling spilled over to U.S. markets, where U.S. stock futures edged lower.
In Asia, inflation quickened in China and revised data indicated Japan has slipped into recession. Asian markets ended higher. The Shanghai Composite was the best-performing major index, adding more than 1%.
Aside from Europe, U.S. investors will remain cautious as long as lawmakers fail to find consensus before the end of the year to avert the scheduled tax increases and spending cuts. Without a deal, the U.S. economy could fall back into a recession.
Oil prices climbed 63 cents to $86.54 U.S. a barrel
Gold prices gained $12.70 to $1,1718.10 U.S. an ounce.
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