(October 8 – 12:45 ET) – On yet
another narrow rally markets are
up this morning, yet the move is
rather deceptively weak.

The TSE 300 is up about 42
points at midday, yet the volume
has been light and the buying
rather narrow. With the long
weekend looming it seems that
many traders may have checked
out early, leaving the few
remaining bulls to drive the
index higher. Despite the up
move, volume is only 43.6 million
shares, and that is virtually
perfectly split between buying
and selling volume. The
leadership is decidedly narrow,
9:7 in favour of decliners.

Utilities are leading the way,
with BCE and Nortel
heading the advance. The
possibility that BCE will jump
into the quickly consolidating
telecom sector, and some positive
comments from Fidelity
Investments Canada, has the
stock jumping, up about 2.5% at
midday.

Apart from the strength in
those few stocks, there is
relatively little buying. Gold
stocks are continuing their
yo-yo act, with signs of a
resurgence today. The stocks
are bouncing from overbought
to oversold depending on how
the rumour winds are blowing
about the sector.

But while the golds are up
today its sister group, the base
metals, are down. Energy stocks
are leading the way to the
downside, and financials have
been rather weak.
Toronto-Dominion Bank and Kingsway
are the leading financials
trading down, but again the
action is rather light.

Montreal is following the TSE
and was up about 20 points on the
utilities. The small caps
obviously are not participating
in the narrow blue chip rally.
The ASE is down 4.5 points,
while the VSE is down one.

In the U.S., traders embraced
some weak labour market data as
positive for stocks. Markets
fought some mixed signals in the
numbers and have emerged on the
upside. The Dow is up about 85
points so far, Nasdaq has bounced
around its open and is currently
in the black, up a couple of
points. The S&P is up 13 points.