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Russia cuts key interest rate to help economy, but depriving ruble of support

MOSCOW - In a surprise decision, Russia's central bank on Friday cut its key interest rate, which it had raised sharply last month to support the collapsing ruble, in order to help the fading economy.

The move triggered a drop in the ruble, which was down more than 3 per cent at 71 rubles against the dollar in early afternoon trading in Moscow.

The central bank explained its decision to cut the rate from 17 per cent to 15 per cent by saying that the risks of an economic slowdown are now higher than the risks associated with the ruble's drop. The currency's 50 per cent drop since the summer has caused a spike in inflation.

Higher interest rates can help a currency but also hurt economic growth by making loans more expensive.

Analysts said Friday's move was likely due to pressure by government officials and Russian businesses, which are suffering from the high rates.

The central bank said it expected inflation, currently at an annual 13 per cent, to peak in the middle of the year and fall below 10 per cent next year as the economy adjusts to the weaker ruble.

"Inflation and inflation expectations are expected to decrease," the bank said in a statement.

The central bank had raised its key interest rate to 17 per cent in December in a desperate attempt to curb the devaluation of the ruble, which was fueling inflation by raising the price of imports.

Market investors had expected the central bank to hold its interest rates at Friday's policy meeting since it had indicated it would begin to cut rates only when inflation starts declining. That said, the bank has been under pressure domestically to bring rates down to limit damage to economic activity.

"The lobby of bankers and industrialists is growing, with clear (almost aggressive) pressure on the Central Bank of Russia to cut," David Nagle, head of research of Moscow-based Renaissance Capital, said in an emailed note to investors.

Earlier on Friday, a top Russian official accused a leading rating agency of trying to turn tycoons against the Kremlin.

Standard & Poor's this week downgraded Russia's credit rating to a non-investment grade, for the first time in more than a decade.

In remarks in parliament on Friday, Deputy Prime Minister Igor Shuvalov said the goal of the downgrade was to push businesses "to withdraw their support" for the government and President Vladimir Putin.

Russia has exceptionally low levels of public debts level for a country with a "junk" status but the downgrade underlined investors' fears about the unpredictability of Putin's foreign policy and the collapse of the ruble.

The Canadian Press


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Prices in the 19 euro countries fall 0.6 per cent annually in January as ECB readies stimulus

FRANKFURT - Falling prices sent another worrying signal about the eurozone economy just before the European Central Bank starts at 1 trillion euro ($1.1 trillion) stimulus effort.

Consumer prices fell 0.6 per cent in the 12 months to January, accelerating the 0.2 per cent annual drop in December.

Prices are weighed down by the recent plunge in oil prices. But even excluding energy costs, they are weak, a sign of the deep economic malaise afflicting the 19 countries that share the euro currency.

Friday's report by the Eurostat statistics agency showed that the core inflation rate, which strips out volatile food and energy prices, was at plus 0.5 per cent, down from 0.7 per cent the month before.

Falling prices have raised fears that the eurozone will fall into outright deflation, a trap that can paralyze the economy if it leads to falling wages and investment. Japan fell into deflation in the 1990s and is still trying to get out.

The European Central Bank is readying a massive 1 trillion euro stimulus program to try to raise inflation close to its goal of 2 per cent and to get the economy moving. The ECB plans to buy 60 billion euros per month in government and private-sector bonds using newly printed money, starting in March. That is aimed at driving down borrowing rates. It should also lift inflation simply by increasing the number of euros circulating in the economy.

"The sharp fall in inflation poses a risk to inflation expectations, which had already been under pressure due to the huge amount of slack in the economy and the slow pace of the recovery," Christian Schulz, senior economist at Berenberg Bank, wrote in an email. "The ECB was thus more than justified in taking aggressive action earlier this month."

"The multi-stimulus of cheap oil, a weak euro and aggressive monetary easing is now stabilizing expectations and will help the ECB reach its price stability target over time."

Schulz said, however, that to fully benefit countries would have to take steps to make their economies more growth-friendly. That could include cutting burdensome rules on hiring and firing.

Meanwhile, jobless figures showed a slight improvement in December, with the unemployment rate falling to 11.4 per cent from 11.5 per cent the month before. The number of unemployed people fell by 157,000 in the eurozone.

The figures showed a wide diversity between countries. Germany, the eurozone's biggest economy, had a jobless rate of only 4.8 per cent. Greece, still recovering from a crisis over too much government debt, had the highest at 25.8 per cent. Spain, working off a debt crisis that involved a real estate boom and bust, had a jobless rate of 23.7 per cent.

Greece's new government has rejected the budget austerity course forced on the country as a condition of getting international bailout loans. But creditor countries led by Germany are insisting that it stick with its promises to restrain government spending and public jobs.

The Canadian Press


Ikea Canada's president talks business, furniture assembly and winter

TORONTO - Ikea Canada's new president has an eye towards expansion in 2015 but is not saying whether the Swedish furniture giant will add to its 12 Canadian stores or open pickup locations.

Stefan Sjostrand, who took on the job last September, says shoppers can expect this year to see a revamped website that is easier to navigate, as the retailer aims to double its online business to 10 per cent of overall sales.

Ikea Canada's overall sales numbers jump more than five per cent to $1.6 billion in 2014.

Most known for its affordable, do-it-yourself furniture with tongue-twister names, the retailer will also be pushing improved services for Canadian shoppers including home delivery, personal shopping services, old mattress return and kitchen and bathroom installations.

Ikea will also continue with a number of sustainability initiatives this year that included the recent purchase of a 20-turbine wind farm in Pincher Creek, Alta., which produces enough energy for 50,000 homes or 32 Ikea stores.

Sjostrand sat down this week with The Canadian Press to talk about moving to Canada and offer tips on putting together the ubiquitous Ikea furniture.

The Canadian Press: You are from Sweden and have worked for Ikea in Sweden, the Netherlands, and most recently Paris. How have you found the transition to Canada?

Stefan Sjostrand: For me and my family, it has been very easy to integrate into society. I love the Canadians. I love the city of Toronto. We have only been here for five months and it feels like we've been here a long, long time. I think that's a good sign that we like it here. As a Swede, we are quite used to winter as well. I'm a winter person and an outdoor person. I like to be out and we like to go skating, go skiing. We're going to Whistler in March. We really like to explore Canada as well as a family.

CP: Besides a love for hockey, how are Canadians like the Swedes?

SS: Canadians are very similar to Swedish people actually. Maybe that's why I like the city so much. The Swedish like to be outdoors. The home is very important, taking care of your home. Also Canadians like to travel a lot. People in Sweden like to travel a lot. There are a lot of similarities.

CP: What differences have you noticed so far about Canadian Ikea shoppers?

SS: The biggest difference from a consumer perspective is that Canadians are keen on services. Services are a big thing for Canadians. One of my goals when I came here is to have services as a growth driver in Canada.

CP: Who is your target customer at Ikea?

SS: Women are super important to us. Women and families with children, that's the people we want to reach out to. Women make most of the decisions at home and women work more in Canada as well, that's why there's an interest in services. In some countries, only one of the family members is working.

CP: How much of your house is furnished by Ikea and do you put together your own furniture?

SS: About 60 to 70 per cent. It was quite funny (when I went shopping at Ikea in Toronto) because no one in the store knew who I was. When I had to come to the checkout, I had to show my ID, and then I became famous in the store. I'm not handy. I have my thumbs here in the middle. (My tip is) if you just follow the instructions, you're always successful. I do it mainly with my two daughters. I have a methodology when I do it. I open the box, I sort the screws, I start to read and say where do we start? I'm very methodical doing it.

CP: Be honest: as a Swede, do you find it offensive when customers mispronounce the IKEA product names?

SS: Not at all. The story behind the names is that the founder was dyslexic so he designed it by names instead of numbers. So the products are names of different cities in Sweden. For example, our sofas have names around a specific region and our outdoor furniture have names after Swedish islands.

CP: Do you think Ikea will ever do away with Allen keys and having customers assemble their own furniture?

SS: In the beginning, Ikea had assembled furniture but one of the designers found out that if we made it smarter, and we made the packages smaller and more condensed, we can make the product cheaper. That's how it started. So we made the furniture knocked down: that you do your part, we do our part and together we save money. That we will never go away from. That's the fundamental concept and that's what has made us successful over the years.

This interview has been edited and condensed.

Follow @LindaNguyenTO on Twitter

The Canadian Press


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CIBC cuts 500 jobs is past 2 weeks: Wall Street Journal report

TORONTO - A published report says the Canadian Imperial Bank of Commerce (TSX:CM) has cut more than 500 jobs over the past two weeks.

The Wall Street Journal quoted an email from the bank as saying the reductions are part of "an overall alignment of resources."

The cuts at CIBC follow a string of other recent job losses in Canada.

About 350 employees lost their jobs at Tim Hortons this week in cuts focused mainly on the company's headquarters and regional offices.

Earlier this month, Target announced it was shuttering its Canadian store, putting more than 17,000 out of work.

Meanwhile, clothing retailer Mexx declared bankruptcy all of its stores, including 170 in Canada, while Sony plans to close its 14 remaining Canadian locations, a move that will affect 90 employees.

In December, CIBC reported fourth quarter net income of $811 million, down from $825 million.

The Canadian Press


Canadian Oil Sands slashes dividend more than expected amid crude drop

CALGARY - Canadian Oil Sands Ltd. (TSX:COS), the biggest partner in the Syncrude Canada Ltd. oilsands project, is slashing its quarterly dividend to five cents a share from 35 as the outlook for crude prices deteriorates.

In December, Canadian Oil Sands signalled it would be cutting its quarterly payout to 20 cents in order to protect its balance sheet, but the picture has become gloomier since then.

At the time, oil prices were around US$67 a barrel. On Thursday, the March contract settled at US$44.53.

When it released its forecast in December, Canadian Oil Sands was planning based on US$75 oil for this year. Now it's expecting US$55. That's a sharp drop from crude's 2014 peak above US$107 a barrel in June.

"We entered the current period of low crude oil prices with a strong balance sheet, and by reducing our dividend and cutting costs at Syncrude, COS is well positioned to manage its business through a prolonged period of low oil prices and retain its long-term value," CEO Ryan Kubik said in a release.

"Syncrude has the flexibility to respond to market conditions without affecting projections for 2015 production."

Production at Syncrude is expected to range between 95 million and 110 million barrels in 2015 — the same as its earlier forecast.

The dividend cut did not come as a surprise to John Stephenson, president and CEO of Stephenson & Company Capital Management.

"I'm kind of bearish on the name and I did expect a pretty severe cut," he said. "I don't like this name. I don't think you need to be there as an investor."

Canadian Oil Sands has a lot working against it, Stephenson said. It has high fixed operating costs, produces only crude oil and has not locked in higher prices through hedging contracts.

The one bright spot is that the company has about $1.4 billion in unused credit facilities, meaning it shouldn't face a funding crunch for now, he said.

Canadian Oil Sands has a 37 per cent stake in Syncrude, a massive mining operation north of Fort McMurray, Alta. Since its Syncrude interest is virtually its only asset, the company is particularly vulnerable to swings in crude prices.

The other partners in Syncrude include Imperial Oil Ltd. (TSX:IMO), Suncor Energy Inc. (TSX:SU) and Chinese firms CNOOC Ltd. and Sinopec, along with Mocal Energy and Murphy Oil.

Trading in Canadian Oil Sands shares was halted on the Toronto Stock Exchange on Thursday afternoon. The stock was down about seven per cent at $6.51 before that.

During the last three months of 2014, Canadian Oil Sands' profits fell by nearly 87 per cent. Net income was $25 million, or five cents per share, versus $192 million, or 40 cents per share in the same year-earlier period.

Cash flow from operations fell to $207 million, or 43 cents per share, from $391 million, or 81 cents per share.

Follow @LaurenKrugel on Twitter

The Canadian Press


N.W.T. premier launches study to lay groundwork for oil pipeline to Arctic Ocean

OTTAWA - The premier of the Northwest Territories is launching a year-long feasibility study for an energy and transportation corridor along the Mackenzie Valley to the Arctic Ocean.

Bob McLeod, in Ottawa for meetings with his fellow premiers, says Canada needs to get its resources to market and it's time to look seriously at what he calls the northern option.

For almost two years, McLeod has been actively promoting the concept of an "Arctic Gateway" that could move Alberta oil and territorial mineral wealth to a port on the Arctic Ocean at Tuktoyaktuk.

He used a speech to a reception in Ottawa to announce a full feasibility study that will include a look at the economic, environmental and social impacts of the proposed corridor.

McLeod says the driving force behind developing the Mackenzie Valley corridor is not an oil pipeline to move Alberta bitumen.

But the Northwest Territories premier has been making exactly that case for the last couple of years, including telling a Washington audience last fall that "we have no choice but to go north" given opposition to proposed routes like the Northern Gateway line to B.C. and the Energy East pipeline to Atlantic Canada.

Follow @bcheadle on Twitter

The Canadian Press


Weak energy sector, low interest rates behind loonie's slow slide:banks

OTTAWA - The Canadian dollar continued its slide south on Thursday, dipping below the 80-cent US mark to its lowest level in nearly six years.

Canada's major banks are forecasting the loonie to continue on its downward path – a trajectory that will likely alter what sectors of the economy see the decline as a positive or a negative.

"There's always winners and losers when the currency sits at any given level," said Avery Shenfeld, chief economist for CIBC World Markets.

Shenfeld said the lower dollar should provide a boost to the Canadian export sector and improve job prospects.

On the flip side, Shenfeld noted the weaker loonie will make it more expensive for Canadians to buy imported goods and to travel abroad.

The Canadian dollar fell again Thursday to 79.3 cents US, its lowest value since April 2009.

CIBC released a report Thursday that predicts the Canadian dollar to bottom out at 77 cents US in the middle of 2015 before it starts climbing back up in the second half of the year.

"But we do have to remember that by historic standards, the Canadian dollar actually isn't that weak," Shenfeld said.

"We've just come off a period of a few years where it was quite overvalued compared to where it historically had been."

The country's weakening oil and gas sector are partly responsible for the falling dollar, as is the Bank of Canada's recent cut to its trend-setting interest rate.

With these conditions — among others — the loonie is expected to continue its decline, Scotiabank strategist Camilla Sutton wrote in a note to clients Thursday.

The dollar fell about 7.4 per cent since the start of the year and 15 per cent since its July 2014 high, Sutton wrote.

"The environment has turned rapidly against CAD (the Canadian dollar) and we are likely to see ongoing weakness in 2015," she wrote.

Sutton added if oil markets fail to stabilize, the loonie will fall even further, particularly since the Bank of Canada has tied its decisions on the country's trend-setting interest rate directly to crude.

Last week, the central bank blamed the oil slump for its unexpected move to cut its interest rate for the first time since 2009. It nudged a quarter point lower to 0.75 per cent.

"The Bank of Canada denies that it's directly targeting the exchange rate but knows that, by cutting interest rates, a byproduct of that will be a weaker Canadian dollar," Shenfeld said.

Several banks, including CIBC, TD Bank and the National Bank of Canada, are now predicting the central bank to cut its interest rate by another quarter percentage point in March.

"The Bank of Canada rarely moves interest rates only once," Shenfeld said.

"It's like potato chips, once you eat one, you're at least on the course for a second."

Note to readers: This is a corrected story: A previous version gave incorrect figures on the BoC rate cut

The Canadian Press


U.S. Senate passes bill approving Keystone oil pipeline, defying White House

WASHINGTON - The Republican-controlled United States Senate on Thursday approved a bill to construct the Keystone XL oil pipeline, defying a presidential veto threat and setting up the first of many battles with the White House over energy and the environment.

The 62-36 vote advanced a top priority of the newly empowered GOP, and marked the first time the Senate passed a bill authorizing the the privately funded Canadian project pipeline, despite numerous attempts to force President Barack Obama's hand on the issue. Nine Democrats joined with 53 Republicans to back the measure.

This bill "is an important accomplishment for the country," said Majority Leader Mitch McConnell of Kentucky. "We are hoping the president upon reflection will agree to sign on to a bill that the State Department said could create up to 42,000 jobs and the State Department said creates little to no impact on the environment."

Still the vote was short of the threshold needed to override a veto, and the legislation still must be reconciled with the version the House of Representatives passed.

"We hope President Obama will now drop his threat to veto this common-sense bill that would strengthen our energy security and create thousands and thousands of new, good-paying American jobs," said House Speaker John Boehner.

Democrats framed the bipartisan bill as gift to a foreign oil company that would have little benefit for the American people, because much of the oil would be exported. They tried and failed to get amendments on the bill to construct the pipeline with U.S. steel, ban exports of the oil and the products refined from it, and protect water resources.

The Senate agreed to add an energy efficiency measure, and went on the record saying climate change was not a hoax and the oil sands should be subject to a tax that helps pay for oil spill cleanups. Oil sands are currently exempt.

"This bill is a disgrace," said Sen. Barbara Boxer (D-Calif.), the top Democrat on the Senate environment committee. "We tried on our side to make this a better bill and they turned us away."

TransCanada Corp., the pipeline's developer, disputed the export argument Thursday, saying it didn't make sense.

"Those who argue this pipeline is for export are not being factual," said Russ Girling, president and chief executive officer of TransCanada. "It's time to approve Keystone XL so we can transport Canadian and American oil to fuel the everyday lives of the American people."

First proposed in 2008, the $8 billion pipeline project has been beset by delays in Nebraska over its route and at the White House, where the president has resisted prior efforts by Congress to force him to make a decision. In 2012, Obama rejected the project after Congress attached a measure to a payroll tax cut extension that gave him a deadline to make a decision. TransCanada Corp. then reapplied.

Obama has said he will not be forced to make a decision on the pipeline, which requires presidential approval because it crosses an international border, until the review process concludes. Federal agencies' comments on whether the project is in the national interest are due Monday.

Environmental groups have called on Obama to reject the project outright, saying it would make it easier to tap a dirty source of energy that would exacerbate global warming. The State Department's analysis, assuming higher oil prices, found that shipping it by pipelines to rail or tankers would be worse for the planet. It also concluded that the project, after construction, would create only 35 permanent jobs, a figure Sen. Chuck Schumer (D-N.Y.) compared to a fried chicken franchise.

"The facts are clear: the Keystone XL pipeline will only create 35 permanent jobs while dumping millions of tons of carbon pollution into the air and threatening waterways and communities across the Midwest," said Tom Steyer, the investor and philanthropist who founded the NextGen Climate political action committee.

Supporters say the pipeline is a critical piece of infrastructure that will create thousands of jobs during construction and boost energy security by importing oil from a friendly neighbour.

"We urge the president to make the right decision and approve KXL because it is in this nation's best interest," said Jack Gerard, the president and CEO of the American Petroleum Institute. "The fact is that if all other infrastructure projects are delayed like Keystone XL, we are years away from approving anything that could create jobs and enhance our energy security."

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Follow Dina Cappiello on Twitter at http://www.twitter.com/dinacappiello

The Canadian Press


4 Ways a change in CRTC Substitution Rules Will Affect Canada

TORONTO - Canadian TV viewers, perhaps as early as next year, will finally get to see those U.S. Super Bowl ads they've been clamouring to watch for years, but industry experts say the rule change by regulators could have ripple effects.

The Canadian Radio-television and Telecommunications Commission said Thursday that it will officially ban the substitution of Canadian advertisements over American TV signals starting with the Super Bowl being played in 2017.

However, the ads might be seen in Canada as early as next year if rights holder Bell Media gives the OK.

For now that decision is restricted to the big game, but industry analysts say it opens up a series of new challenges that could impact the country's broadcast industry, which is already facing pressure from streaming video alternatives and defecting advertisers.

Other changes that could develop from the fallout of the CRTC's decision on the Super Bowl:

MORE PRESSURE ON AD RATES

Advertisers could push Canadian TV networks to lower how much they charge for a Super Bowl TV spot, arguing that more Canadians viewers are tuned to the U.S. feed.

The big game is one of the most lucrative annual events for broadcasters in Canada.

This year, CTV charged between $170,000 and $200,000 for a 30-second advertisement on the Super Bowl, according to figures confirmed by a source close to the network.

CANADIAN COMPANIES MAKE TV A LOWER PRIORITY

National advertisers like Tim Hortons, grocery chains and the Canadian banks will get less bang for their advertising buck on television, which could push them to look for alternatives.

"They will take the money and put it into social advertising — be it Twitter, Facebook or Instagram — and tap into streams of people engaged in the Super Bowl at that moment," suggested Kaan Yigit, an analyst at Solutions Research Group.

"Those advertisers are already experimenting with a migration of their dollars out of TV. We don't have to give them new reasons."

TODAY THE SUPERBOWL, TOMORROW THE OSCARS?

While the CRTC says changes to substitution rules only affect the Super Bowl, analysts suggest the door is open for other major live events, like the Oscars and Grammy Awards.

"If they start picking and choosing what are (considered) high-profile broadcasts, it could have a more negative impact," said Dave Heger, a telecommunications analyst at Edward Jones in St. Louis.

While the Oscar commercials don't compare with the hype around the Super Bowl, a growing number of U.S. advertisers have warmed to the awards show as a way to plug new products.

Samsung often picks the Oscars as the launch pad for its biggest campaigns, while both cosmetics companies and automakers traditionally round up celebrities to appear in new commercials made for the event.

ROGERS GETS MORE SWAY

Holding the Canadian broadcast rights to National Hockey League games for 12 years will give Rogers Communications the upper hand in negotiations with advertisers who want to reach viewers on a national scale every week.

Rogers has already tied up long-term branding deals with Scotiabank and other big companies like Canadian Tire and brewer Molson, but other advertisers could wind up forking over more money to lock-in viewers.

Follow @dj_friend on Twitter

The Canadian Press


Most actively traded companies on the TSX

Some of the most active companies traded Thursday on the Toronto Stock Exchange:

Toronto Stock Exchange (14,635.96, up 33.08 points):

Talisman Energy Inc. (TSX:TLM): Oil and gas. Up three cents, or 0.32 per cent, to $9.37 on 6.6 million shares.

Canadian Oil Sands Ltd. (TSX:COS). Oil and gas. Down 50 cents, or 7.13 per cent, to $6.51 on 6.1 million shares. Trading was halted prior to an announcement after the close that it was slashing its quarterly dividend to five cents from 35 cents. The biggest partner in the Syncrude Canada Ltd. oilsands mine north of Fort McMurray, Alta., says it is making the move to preserve cash as it copes with the 55 per cent plunge in oil prices since last summer.

Pengrowth Energy Corp. (TSX:PGF). Oil and gas. Down eight cents, or 2.47 per cent, to $3.16 on 5.8 million shares.

B2Gold Corp. (TSX:BTO). Miner. Up five cents, or 2.08 per cent, to $2.45 on 5.19 million shares.

Bombardier Inc. (TSX:BBD.B). Aerospace and transportation. Up six cents, or 2.09 per cent, to $2.93 on 5.18 million shares.

Pacific Rubiales Energy Corp. (TSX:PRE). Oil and gas. Down 40 cents, or 12.12 per cent, to $2.90 on 4.9 million shares.

Companies reporting major news:

PotashCorp of Saskatchewan (TSX:POT). Fertilizer. Up 12 cents, or 0.26 per cent, to $45.48 on 2.1 million shares. PotashCorp is boosting it quarterly dividend nine per cent amid quarterly earning of $407 million or 49 cents per share, which beat estimates of 47 cents. Revenue was $1.9 billion, up from $1.5 billion a year ago.

Restaurant Brands International Inc. (TSX:QSR). Up $1.44, or three per cent, to $49.44 on 361,030 shares. Tim Hortons disclosed that about 350 employees lost their jobs this week in layoffs across the organization, focused mainly at its headquarters and regional offices. Tim Hortons merged with Burger King under Restaurant Brands International late last year and the company's new owner was widely expected to cut staff.

Rogers Communications Inc. (TSX:RCI.B). Up 31 cents, or 0.7 per cent, to $44.86 on 1.7 million shares. The diversified communications and media company posted adjusted net income of $355 million or 69 cents a share, beating expectations of 64 cents. Its revenue was up four per cent at $3.37 billion. It also hiked its annual dividend by five per cent.

TransCanada Corp. (TSX:TRP). Oil and gas. Up 66 cents, or 1.19 per cent, to $55.98 on 1.1 million shares. The Republican-controlled U.S. Senate on Thursday approved a bill to allow construction of the Keystone XL oil pipeline, defying a presidential veto threat and setting up the first of many battles with the White House over energy and the environment.

The Canadian Press


Toronto stock market little changed amid steep declines in resource sectors

TORONTO - The Toronto stock market closed slightly higher Thursday in a volatile session that saw the resource sectors register further declines.

The S&P/TSX composite index came back from a 210-point plunge to finish 33.08 points higher at 14,635.96.

There was also uncertainty about when the U.S. Federal Reserve is going to raise rates.

"It looks like they're going to go mid-year; that's another concern," said Ian Nakamoto, director of research at 3MACS.

The Canadian dollar lost more ground in the wake of Wednesday's announcement from the Federal Reserve, which left markets with the impression that the U.S. central bank will start hiking rates around the middle of this year. The loonie lost 0.57 of a cent to 79.3 cents US, its lowest level since late March 2009, adding to a drop of three-quarters of a cent on Wednesday.

The Fed said it would be patient in beginning to normalize monetary policy while at the same time it pointed out a string of positives about the American economy, including that economic activity is expanding at a solid pace.

U.S. markets put interest rate concerns aside and several homebuilders surged as data showed that completed home sales increased seven per cent in the fourth quarter.

The Dow industrials ran ahead 225.48 points to 17,416.85, the Nasdaq climbed 45.42 points to 4,683.41 and the S&P 500 index gained 19.09 points to 2,021.25.

Oil prices inched up slightly after plunging almost $2 Wednesday in the wake of figures showing U.S. crude inventories still at 80-year highs. The March contract came off a low of $43.58 to add eight cents to US$44.53 a barrel and the energy sector dropped 1.1 per cent.

A major decliner was Canadian Oil Sands. The company cut its quarterly dividend from 35 cents to five cents a share to preserve cash as it tried to cope with the 55 per cent plunge in oil prices since last summer.

The company announced in early January that it would be cutting the dividend from 35 cents to 20 cents, but said after markets closed Thursday that the outlook has deteriorated since then and slashed the planned payout further. Its stock had been halted mid-afternoon, when it was down 50 cents or 7.1 per cent at $6.51.

The base metals sector on the TSX fell 1.65 per cent as March copper fell three cents to US$2.44 a pound.

"The only thing good is that (miners) have a cushion with the lower Canadian dollar but that's not enough to offset the decline in copper — copper is off 30 per cent," noted Nakamoto.

Gold plunged as traders weighed the chances of the Fed moving rates up as early as June and February bullion declined $31.30 to US$1,255.90 an ounce and the gold sector faded 0.6 per cent.

TSX sectors outside the resource groups were positive, led by a 2.1 per cent rise in the tech sector and a 1.9 per cent run-up in consumer staples.

Meanwhile, PotashCorp (TSX:POT) posted quarterly income of $407 million or 49 cents per share, beating estimates of 47 cents. Revenue was $1.9 billion, compared with $1.5 billion a year ago and its shares added 12 cents to $45.48.

Rogers Communications Inc. (TSX:RCI.B) posted adjusted net income of $355 million or 69 cents a share, beating expectations of 64 cents. Its revenue was up four per cent at $3.37 billion. It also hiked its annual dividend by five per cent and its shares rose 31 cents to $44.86. Its shares gained $1.76 to $78.

The Canadian Press


Celebrities from Katie Couric to Kim Kardashian poke fun at themselves in Super Bowl spots

NEW YORK, N.Y. - Along with puppies and babies, celebrities are a Super Bowl advertising staple. And this year is no exception.

Using stars is a surefire way to grab attention during advertising's most competitive night, when a crowded field of 40-plus marketers each vying for the attention of the more than 110 million viewers that are expected to tune in to the Super Bowl on Sunday.

Advertisers use celebrities to "help insure the success of their creative investment," said Devra Prywes, vice-president of marketing for research firm Unruly.

But it doesn't always work. In order for an ad to go viral, it needs to connect emotionally or give the audience multiple reasons to share, Prywes said: "A celebrity can't save an ad that doesn't do those things, but the right celebrity can help amplify it."

This year, advertisers are choosing quirkier celebrities and poking fun at bigger names. For instance, Katie Couric and Bryant Gumble make fun of their inability to understand the Internet in 1994 in a BMW ad. And character actors Steve Buscemi and Danny Trejo star in a Snickers spot.

Here's a look how brands are using celebrities in this year's Super Bowl ads.

Snickers "The Brady Bunch"

In keeping with its 5-year-old "You're Not You When You're Hungry," campaign that shows hungry people resembling humorous celebrities, Snickers 30-second ad recreates the famous Brady Bunch episode in which the oldest daughter, Marcia, gets hit in the nose with a football. Florence Henderson and action movie "Machete" star Danny Trejo also make appearances.

Online: https://www.youtube.com/watch?v=rqbomTIWCZ8

BMW "Newfangled Idea"

In order to promote its new all-electric BMW i3 in a 60-second spot, BMW enlisted former "Today" show hosts Katie Couric and Bryant Gumbel to recreate a 1994 on-air conversation when they tried to figure out what the @ symbol in an email address meant. "Alison," Couric says to an off camera producer in the 1994 clip, "Can you explain what Internet is?" The ad flashes forward to today, when the duo are in a BMW's i3 similarly confused. "Big ideas take a little getting used to," copy states.

Online: https://www.youtube.com/watch?v=U1jwWwJ-Mxc

Squarespace "Dreaming With Jeff"

The website publisher isn't releasing its full 30-second spot until game time but a teaser ad shows a bearded "The Big Lebowski" actor Jeff Bridges recording relaxing sounds for an album called "Jeff Bridges Sleeping Tapes." The company plans to sell the resulting tapes in cassette tape and vinyl form and the tracks are free to stream online. Squarespace CEO Anthony Casalena said the idea is that any idea can be presented via a Squarespace platform.

Online: dreamingwithjeff.com

T-Mobile "#KimsDataStash"

T-Mobile hired Kim Kardashian for a 30-second spoof on public service announcements. It pokes fun at Kardashian's constant online presence. She makes a plea to save people's unused data taken back by wireless carriers. She laments that the data could have been used to see Kardashian's makeup, vacations and outfits. "Please help save the data," she pleads. The ad promotes T-Mobile's service that lets users keep their unused data for a year.

Online: https://www.youtube.com/watch?v=ZTwzsV3I3OQ

Kia "The Perfect Getaway"

Kia's ad spoofs Pierce Brosnan's action-movie persona. In the ad, an agent describes a perfect part for Brosnan, who once played James Bond. Brosnan keeps expecting evil villains or explosions, but actually the agent describes Kia ad in which Brosnan drives to a snowy cabin in a 2016 Sorento. The tagline is "The perfect getaway vehicle."

https://www.youtube.com/watch?v=XJ-mwaDODt8

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The Canadian Press


US stock market finishes higher after goods news on earnings and jobs market

NEW YORK, N.Y. - The U.S. stock market is closing sharply higher after investors received encouraging news on corporate earnings and the jobs market.

The Dow Jones industrial average jumped 225 points, or 1.3 per cent, to close at 17,416 Thursday. The Standard & Poor's 500 index rose 19 points, or 1 per cent, to 2,021.

The government reported Thursday that weekly claims for unemployment benefits dropped to a 15-year low. Ford, Harley-Davidson, Coach and Ally Financial were among the companies that reported quarterly results that exceeded Wall Street's expectations

The yield on the 10-year Treasury note edged up to 1.76 per cent from 1.72 late Wednesday.

The Canadian Press


Shell to move forward with Arctic Ocean drilling off Alaska if it can get required permits

ANCHORAGE, Alaska - Royal Dutch Shell PLC will move forward with drilling off Alaska's northwest coast if it can obtain permits it needs and drill safely, its chief executive officer said Thursday.

Speaking in London on the company's fourth-quarter earnings, Ben van Beurden said Shell will move forward with its plan to use two drill vessels in the Chukchi Sea, subject to getting permits and legal clearance.

"There's a few other challenges that are being worked, that can - again - hold us up this year," he said in response to questions. "But, provided that doesn't happen, we have the permits in place and we are operational ready, yes, we are minded to drill this year, in the Chukchi."

The announcement was consistent with what Shell officials have been saying about the upcoming summer open-water season in Alaska.

Drilling off Alaska's shore is strongly opposed by environmental groups and some Alaska Native groups, which contend the industry has not demonstrated it can clean up a spill in ice-choked, cold waters far from infrastructure such as major ports and airports.

"No oil company should be drilling in the Arctic Ocean when there are no proven ways to do it safely and no viable means for cleaning up potential spills," said Margaret Williams, director of U.S. Arctic programs for the World Wildlife Fund, in a statement.

Shell's drill ships would be accompanied by a flotilla of support vessels that the company says could quickly stop a blowout and contain a spill.

Shell last drilled in Arctic waters off Alaska in 2012. One drill vessel afterward, the Kulluk, broke free from tow lines while attempting to cross the Gulf of Alaska and ran aground off an island near Kodiak. The contracting company on a second vessel, the Noble Discoverer, was convicted of eight environmental and maritime crimes and fined $12.2 million.

The company paused a year ago, van Beurden said, because of a legal challenge it could not overcome. Drilling in 2015 will depend on a number of things.

"First of all, will we be technically, logistically ready to go ahead? I'd be so disappointed if we wouldn't," he said.

Shell has kept all its capability in place, tuned it, and upgraded it to be ready for the upcoming summer open-water season, he said. However, the company lacks key permits, van Beurden said.

"So, if we don't get the permits, or if the permits are not acceptable and not compliable, we will have no option but to 'not' go ahead," he said.

He expects a timely resolution to a lawsuit that challenged the federal government's environmental assessment of the effects of drilling before it sold Chukchi leases to Shell and other companies in 2008. The Bureau of Ocean and Energy Management in October released a revised environmental report that must pass judicial review.

Shell's 2015 overall spending on conventional exploration outside of Alaska will be less than $3 billion, said Chief Financial Officer Simon Henry. In Alaska, exploration costs will exceed $1 billion.

"Even if we don't drill, it will be approaching a billion dollars, because of the commitment to keep the fleet of ships that we need," he said. "Remember, this is a logistics operation as much as drilling. Ensuring that the logistics are in place to support the drilling means that quite a lot of spend is already committed."

The Canadian Press




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