By: Franco Pingue
Reuters
Thursday, July 3, 2003

TORONTO, July 3 (Reuters) - Toronto stocks tiptoed to a slightly higher close on Thursday as financial and energy issues rose, but trade slowed almost to a standstill ahead of Friday's U.S. Independence Day holiday.

The Toronto Stock Exchange S&P/TSX composite index .GSPTSE finished 9.48 points, or 0.14 percent, higher at 6,999.78.

Trading is expected to remain thin on Friday as investors stay home for the Fourth of July and after Tuesday's Canada Day holiday.

A morning report that showed the U.S. unemployment rate jumped to a nine-year high in June tamed buying activity and renewed worries about the U.S. economy and corporate earnings.

The market isn't betting on the upcoming second-quarter results to show significant improvements, but most are hoping to get a taste of what companies are expecting for the third and fourth quarters.

"Bland earnings have already been discounted," said John Kinsey, portfolio manager with Caldwell Securities Ltd. "If we can get some guidance for the second half of the year, I think that's really what the market would be looking for."

The heavily weighted financial sector rose 0.4 percent and energy stocks ended 0.5 percent ahead. Six of the TSX's 10 subindexes finished higher.

Royal Bank of Canada RY.TO , the market's biggest stock, rose 83 Canadian cents, or 1.5 percent, to C$57.74, while Bank of Nova Scotia BNS.TO gained 35 Canadian cents, or 0.6 percent, to close at C$60.05.

Energy stocks rose even though a deal looked close to avoid a Nigerian union's threat to cut off oil supplies from one of the world's largest exporters.

EnCana Corp. ECA.TO finished 18 Canadian cents, or 0.4 percent, higher at C$50.93, while Imperial Oil IMO.TO rose C$1.00, or 2 percent, to C$46.70.

Volume during the session was wafer thin as 142 million shares valued at C$1.66 billion changed hands. Market momentum was slightly negative as 532 issues declined and 524 advanced.

The blue-chip S&P/TSX 60 index .TSE60 squeezed out a gain of 0.68 points, or 0.17 percent, to 395.07.

Some market watchers are expecting earnings to recover at a snail's pace and are advising investors to be cautious when dipping into the market.

"Earnings are probably going to be slowly inching up and probably going to take another six months before we can really say they've turned the corner," said Adrian Mastracci, investment counsel and president of KCM Wealth Management Inc.

"If we get anything more than that it will be a nice surprise."

The unexpectedly large jump in monthly job figures south of the border, coupled with a rash of profit warnings from software companies, sent U.S. markets lower in a holiday-shortened session.

The Dow Jones industrial average .DJI slipped 72.63 points, or 0.79 percent, to 9,070.21, while the tech-filled Nasdaq composite index .IXIC dropped 15.27 points, or 0.91 percent, to close at 1,663.46.

($1=$1.34 Canadian)

NOTE: The information provided above is intended for general informational purposes only. It does not constitute advice for anyone's specific situation. Everyone should always first consult directly with their advisors to determine the appropriateness of any information contained above before taking any action. KCM Wealth Management Inc. assumes no responsibility for any loss or damage arising from the use of, or reliance upon the above information.