As expected the Bank of Canada cut its key overnight interest rate 25 basis points this morning to 2.25%. The move should boost Canadian trading. The Bank is looking to encourage demand as well as return inflation to its 2% target point by the end of 2005.

South of the border Wall Street futures are down but European indexes are higher at midday.

London’s FTSE100 share index is up slightly at 4,536.40. In Paris, the CAC 40 Index has gained 17.19 points, or 0.5%, to 3,766.06. In Frankfurt, the Xetra DAX Index has risen 0.5% to 4075.75, helped up by car-makers amid positive news from the Geneva Auto Show.

In business news Canadian Western Bank announced it is paying $25.4 million for HSBC Canadian Direct Insurance.

Britain’s Barclay brothers have withdrawn their offer for Conrad Black’s Hollinger Inc. after a judge in Delaware delivered a stinging rebuke of the deal last week. The $600 million offer for Hollinger was scheduled to expire Wednesday.

Hollinger failed to make a US$7.4 million interest payment due Monday, the company announced after markets closed.

In this morning’s earnings news, sporting goods retailer Forzani Group Ltd. cut its annual earnings forecast despite a solid fourth quarter. The Calgary company revised its profit expectations for its 2004 fiscal year ended Feb. 1 downward to between 85¢ and 87¢ a share, down from earlier guidance of between $1.01 and $1.05 a share, before adjustments.

Statistics Canada is reporting that manufacturers’ prices were up 0.4% in January, following an increase of 0.3% in December. Compared with January 2003, prices fell 3.6%, largely as a result of the continuing effect of a strong Canadian dollar against the U.S. dollar. Without the dollar’s influence, the Industrial Product Price Index would have risen 0.8% rather than falling 3.6% from a year ago.

In Asia, Tuesday trading was mixed. The Nikkei Stock Average rose 90.39 points, or 0.8%, to 11,361.51 points — its highest finish since June, 11, 2002. But Hong Kong’s Hang Seng Index fell 187.37 points, or 1.3%, to 13,731.35.

On Monday, Toronto’s S&P/TSX composite index closed ahead 88.52 points to 8,877.09. New York’s Dow industrials rose 94.22 points to 10,678.14. The Nasdaq composite index rose 27.98 points at 2,057.80, while the S&P 500 index advanced 11.02 points to 1,155.96.