Positive GDP reports on both sides of the border should give an opening boost to North American markets this morning.
Statistics Canada is reporting that gross domestic product advanced 1.7% in 2003, almost half the pace set in 2002, as exports fell for a third straight year. However, the economy ended the year with its best showing in six quarters, says StatsCan, as exports rebounded and GDP advanced a solid 0.9%. Much of the strength came late in the quarter, as growth accelerated from 0.2% in October and November to 0.5% in December. On an annualized basis, Canada’s GDP growth for the fourth quarter was 3.8%.
The American economy was a bit stronger in the final three months of 2003 than earlier projected as the government raised its estimates on spending by consumers and businesses, says the U.S. Commerce Department. Exports showed their largest increase since late 1996.
Gross domestic product increased in October through December at a 4.1% annual rate, half its surging 8.2% pace in the third quarter, says Commerce. But it still represents solid performance, says Commerce.
In Canadian business news, CIBC is facing a class-action lawsuit alleging underperformance in a U.S. index mutual fund. The action has been brought in Quebec Superior Court. The plaintiffs allege that returns of the Renaissance U.S. RSP Index Fund have been 18% below the indexes the fund is intended to track since CIBC assumed management in March 2002.
Yesterday, CIBC chief executive John Hunkin made assurances at the bank’s annual meeting in Winnipeg that the “unacceptable events” will not be repeated. Despite the lawsuit, the bank also released it’s first-quarter results — a 37% profit increase to $609 million despite slightly lower revenues.
Royal Bank is releasing its quarterly results today.
Meanwhile, in Europe at midday London’s FTSE 100 index is up 0.4%. Frankfurt’s DAX is up 0.6%. Paris’s CAC-40 has advanced 0.8%.
Asian stock markets closed higher Friday. The Nikkei average of rose 226.63 points to 11,041.92. Hong Kong’s Hang Seng index rose 232.39 points to 13,907.03.
On Thursday, Toronto’s S&P/TSX composite index rose 100.52 points to 8,737.84, its first triple-digit gain since Feb. 2. In New York, the Dow Jones industrial average fell 21.48 to 10,580.14. The Nasdaq composite index edged up 9.599 to 2,032.57, while the S&P 500 rose a mere 1.24 to 1,144.91.
Positive GDP reports from Canada, U.S.
Growth slowing, but still strong say economists
- By: Stewart Lewis
- February 27, 2004 February 27, 2004
- 09:15