Source: The Canadian Press

The Toronto stock market appeared set for a flat open Thursday amid major merger activity in the Canadian mining sector and little movement in commodity prices.

The Canadian dollar was down 0.15 of a cent to 101.18 cents US.

U.S. futures indicated a weak open ahead of the latest data on jobless insurance claims and the U.S. trade deficit.

The Dow Jones futures declined 13 points to 11,695, the Nasdaq futures were down two points to 2,307 and the S&P 500 futures were off a point to 1,284.

Base metals miners Inmet Mining Corp. (TSX:IMN) and Lundin Mining Corp. (TSX:LUN) have signed a merger deal to create a company valued at $9 billion. The new company will be called Symterra Corp. and have five mines in Europe as well as two large copper development projects in Panama and in the Democratic Republic of Congo.

Under the terms of the deal, Inmet stockholders will receive 3.4918 shares of Symterra for each Inmet share, while Lundin shareholders will receive 0.3333 of a Symterra share for each Lundin share held.

It was the second episode of major dealmaking in the sector this week.

On Tuesday, Consolidated Thompson Iron Mines Ltd. (TSX:CLM) said it was being taken over by U.S. miner Cliffs Natural Resources Inc. (NYSE:CLF) in all cash deal worth about $4.9 billion.

A successful Spanish bond auction provided some reassurance about Europe’s debt crisis.

The news that Spain managed to easily raise 3 billion euros via an auction of five-year bonds further eased tensions following Portugal’s own successful bond auction on Wednesday. Italy — considered less vulnerable than Spain — also successfully raised the money it was looking for in the bond markets.

“As of today, the markets have breathed a sigh of relief but underlying issues remain unresolved in the absence of a more coherent policy to deal with potential debt restructuring,” said Neil MacKinnon, global macro strategist at VTB Capital.

Oil prices were stable after running ahead for the last two sessions after a leak resulted in a shutdown of the 12-hundred kilometre trans-Alaskan pipeline on Saturday.

Traders were watching closely the restart of the pipeline Wednesday.

Alyeska Pipeline Co., which manages the line, said about 400,000 barrels a day began flowing Wednesday, about two-thirds of the 620,000 that was delivered before a leak shut the line down Saturday.

Prices had also run up to a two-year high on signs of improving demand.

The Energy Department said U.S. commercial crude supplies fell by 2.2 million barrels to 333.1 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., expected a decline of only 300,000 barrels.

Crude inventories have fallen six straight weeks, suggesting U.S. consumption is strengthening.

On Wednesday morning, the February crude contract on the New York Mercantile Exchange dipped two cents to US$91.84 a barrel.

Bullion moved lower with the February contract on the Nymex down $3.50 to US$1,382.30 an ounce while the March copper contract in New York was unchanged at $4.41 a pound.

Earlier in Asia, Japan’s Nikkei 225 stock average closed 0.7% higher but South Korea’s Kospi fell 0.3% after the central bank unexpectedly hiked its key interest rate for the second time in three months in an effort to tame rising inflation. The Bank of Korea raised its benchmark seven-day repurchase rate to 2.75% from 2.5%.

Elsewhere, Hong Kong’s Hang Seng index rose 0.5% and Australia’s S&P/ASX 200 jumped 1.5%.

London’s FTSE 100 index slipped 0.04% as The Bank of England announced it would keep its base interest rate at a record low of 0.5% and again ruled out any further investment in economic stimulus.

Elsewhere, Frankfurt’s DAX edged up 0.11% while the Paris CAC 40 was up 0.6% as the European Central Bank left its main interest rate unchanged at 1% on Thursday for the 20th consecutive month.

The ECB’s decision to leave its refinancing rate alone was widely expected, even though annual inflation in the 17-nation eurozone rose to 2.3% in December, above its target and a two-year high.

In earnings news, Cogeco Inc. (TSX:CGO) and its cable subsidiary are raising their financial guidelines for the current fiscal year following a stronger-than-expected first quarter.

Cogeco Cable Inc. (TSX:CCA) said its net income for the fiscal first quarter was $33.6 million, or 69 cents per share, six cents better than analyst forecasts, with $331.5 million of revenue.

Parent company Cogeco Inc. also beat analysts’ profit expectations, reporting 95 cents per share or nearly $16 million in net income with $342.8 million revenue.