Source: The Canadian Press

The Toronto stock market headed for a negative open Friday with investors cautious over political tension in Egypt after President Hosni Mubarak failed to stand down in defiance of widespread protests.

Many currencies traded lower as traders flocked to the safe haven status of the U.S. dollar but rising oil prices helped nudge the Canadian dollar up a slight 0.02 of a cent to 100.44 cents US.

U.S. futures signalled a weak start to the trading day with the Dow Jones industrial futures down 34 points to 12,160, the Nasdaq futures declined 5.75 points to 2,356 while the S&P 500 futures were off 4.6 points to 1,314.

“Renewed tensions in Egypt following Mubarak’s speech will be closely watched and a prolonged stand-off increases the risks for global markets,” said Adarsh Sinha, an analyst at Bank of America Merrill Lynch.

On Thursday, stocks had clambered off lows on mounting speculation that Mubarak was ready to meet protesters’ demands and quit. However, he said late Thursday that he would pass some authority to his vice president but would not immediately leave office.

His perceived defiance has triggered concerns in the markets that the Egyptian crisis is a long way from being resolved and is likely to be met with further anger on the streets of Cairo following Friday prayers.

Oil prices rose amid the latest wave of uncertainty in the Middle East with the March crude contract on the New York Mercantile Exchange up 43 cents to US$87.16 a barrel.

Egypt is not a major oil producing country, but it controls the Suez Canal and a nearby pipeline. Traders also are concerned the upheaval could spread to other countries in the oil-rich region.

Copper prices gave up Thursday’s gain, down two cents to US$4.53 a pound, down from last Friday’s record high close of US$4.58 a pound.

Gold prices inched higher with the April bullion contract in New York 60 cents higher to US$1,363.10 an ounce.

Earlier in Asia, South Korea led the retreat, tumbling 1.6% after the country’s central bank suggested it will raise rates in coming months. The Bank of Korea unexpectedly raised the rate in January for the second time in three months.

Central banks in Asia have been raising borrowing costs in a bid to stem inflation amid robust economic growth. China’s central bank raised interest rates Tuesday for the second time since late December to rein in rising prices.

Australia’s S&P/ASX 200 dropped 0.7% while Hong Kong’s Hang Seng rose 0.5%.

China’s’ benchmark Shanghai Composite Index gained 0.3%.

London’s FTSE 100 index dipped 0.1%, Frankfurt’s DAX added 0.01% while the Paris CAC 40 declined 0.37%.

In corporate news, Telus Corp. (TSX:T) reported that its fourth quarter profits rose to $227 million from $156 million a year ago. Revenue improved to $2.55 billion from $2.44 billion.

Technology titans Nokia and Microsoft are combining forces to create smart phones that might challenge rivals like Apple and Google and revive their own fortunes in a market they have struggled to keep up with. Analysts said the deal was a bigger win for Microsoft than Nokia. And Nokia warned that the new strategy would bring “significant uncertainties” and added it expects margins to be hit by strong competition from rivals. Nokia shares fell more than eight per cent in pre-market trading in New York.

Timmins Gold Corp. (TSXV:TMM) is taking its unsuccessful takeover bid for U.S.-based miner Capital Gold Corp. (TSX:CGC) directly to that company’s shareholders, and is seeking to replace Capital Gold’s current board of directors.

Timmins Gold has been chasing Capital Gold since September and its all-stock offer, valued at $338.7 million at current market prices, has run up against a competing bid made by Canadian miner Gammon Gold Inc. (TSX:GAM), which is valued at just over $300 million.