The Toronto stock market looked set for a positive start to the session Friday as commodity prices advanced at the end of a volatile week.
The Canadian dollar advanced as traders were willing to take on more risk, up 0.7 cents to 97.95 cents U.S.
Traders also took in data showing that Canada’s annual inflation rate fell three-10ths of a point to 2.9% last month as the rate of price increases of most consumer goods measured by Statistics Canada moderated.
That’s the first time the annual inflation rate has been within the Bank of Canada’s 1-3% comfort zone since July. As well, the bank’s core inflation rate, which excludes volatile items such as energy and some foods, edged down one notch to 2.1%
Canadian stocks to watch include Yamana Gold Inc., which has started operations at its Mercedes mine in Sonora, Mexico. Yamana anticipates production to be 120,000 gold equivalent ounces each year, though the company looks to boost that number to 130,000 ounces per year by 2013. Yamana has projects throughout South America as well as Mexico.
U.S. stock futures pointed to a higher Friday open with analysts saying that European Central Bank purchases of sovereign debt have helped stabilize trading in Italian and Spanish bonds.
Futures for the S&P 500 index rose 0.3% to 1,218.20, while those for the Dow Jones Industrial Average gained 0.2% to 11,763.
Worries over the euro-zone accelerated on Thursday, as markets sold down Spanish and Italian government bonds and their yields rose. Stocks in Europe and in the U.S. fell sharply with the S&P 500 dropping 1.7%, the Dow industrials losing 1.1% and the Nasdaq Composite sliding 2%.
Early Friday, analysts said the European Central Bank again intervened by buying the sovereign debt of so-called "periphery countries," helping stem selling in European bond markets and lifting the euro.
Against the dollar, the euro was up 0.4% at $1.3512 U.S. The U.S. dollar index, meanwhile, fell 0.4% to 77.98.
Speaking at a banking forum Friday, European Central Bank chief Mario Draghi also pressured regional leaders to move more quickly to implement changes to the European Financial Stability Facility, the euro-zone bailout fund.
German Chancellor Angela Merkel and British Prime Minister David Cameron were due to meet to discuss the European situation as well.
Prices for oil advanced Friday morning by 92 cents to $99.74 U.S. a barrel. The December gold contract rose $13.30 to $1,733.50 U.S. an ounce.
