Friday Market Report

Canadian stocks fell after U.S. reports on retail sales and import prices spurred concern that the Federal Reserve may resume raising interest rates. The Standard & Poor's/TSX Composite Index had climbed on Aug. 8 and the following day after the U.S. central bank left the target for the overnight lending rate between banks unchanged at 5.25 percent. Commodity producers led the decline as prices of natural gas and gold slid. The S&P/TSX lost 14.15, or 0.1 percent, to 11,944.90.

The S&P/TSX capped gold index gave up 7.95 points, or 2.54%, to 304.95. The S&P/TSX capped energy index 2.67 points, or 0.74%, to 358.25.

U.S. stocks fell, ending their first losing week in a month, after a surge in retail sales suggested the Federal Reserve will resume raising interest rates. Alcoa Inc., the world's largest aluminum maker, handed the Dow Jones Industrial Average its biggest loss as the prospect of higher rates hurt companies most affected by a slower economy. The Dow slid 36.34 points, or 0.3 percent, to 11,088.03. The Standard & Poor's 500 Index lost 5.07 points, or 0.4 percent, to 1266.74.

TOP STORY
Interest in private travel has grown as it has become more affordable and new security restrictions have been placed on travellers, say industry officials. Sweeping new rules - including a ban on liquids, gels and in some cases carry-on luggage - were imposed Thursday after Britain announced it had foiled a major terrorist plot to blow up airliners en route to the United States. While it's too soon to determine their long-term impact, the new restrictions may push more of Canada's business elite to purchase private airtime, said a spokeswoman for Flexjet, which has a fleet of 84 aircraft. Flexjet is the fractional-ownership unit of Bombardier Aerospace.

High costs will ultimately limit how many people opt for private air travel, said Cameron Doerksen, an airline analyst with Versant Partners in Montreal. Joseph D'Cruz, a professor at gthe Rotman School of Management in Toronto, agreed that the price of these private jet options will be a barrier for most businesses. He predicted business travellers will respond to the new airport hassles by combining trips.

Meanwhile, Bombardier's Skyjet aircraft rental division experienced a huge surge in business on Friday.

IN THE NEWS
The December contract for gold bullion on the Nymex lost $1.60 to $644.40 US an ounce.

Crude oil rose on speculation that terrorist threats won't slow the economy or curb air travel as much as expected. Crude oil for September delivery rose 35 cents, or 0.5 percent, to close at $74.35 a barrel on the New York Mercantile Exchange. Prices are down 0.5 percent this week and up 13 percent from a year ago.

European telephone stocks slid for a second day on concern that profit growth in the industry will slacken. Deutsche Telekom AG, which yesterday cut an earnings forecast, and Vodafone Group Plc led declines. Michelin & Cie., the world's largest tiremaker, gained after the company said it will raise prices. Shares of Assurances Generales de France SA advanced after the insurer's profit beat analysts' estimates. The Dow Jones Stoxx 600 Index rose 0.1 percent to 324.45 in London. The Stoxx 50 and the Euro Stoxx 50 measure for the 12 nations sharing the euro were both little changed.

Brazil's benchmark stock index fell for the first week in four as Cia. Vale do Rio Doce dropped on concern the company's offer to buy Canada's Inco Ltd. may be too expensive. The Bovespa index fell 409.33 points, or 1.1 percent, to 36,944.43, bringing its weekly drop to 2.4 percent. Elsewhere in the region, Mexico's Bolsa rose 225.68 points, or 1.1 percent, to 20,273.86. The Peruvian index rose 3 percent today, the biggest increase among indexes included in global benchmarks, bringing its five-day gain to 6.7 percent. The main indexes in Argentina and Chile fell, while those in Venezuela and Colombia were little changed. The Morgan Stanley Capital International Index of Latin American shares fell 0.3 percent to 2436.27. On the week, the index is down 1.6 percent.

Asian stocks fell in U.S. trading as reports on U.S. retail sales and import prices rekindled concern the Federal Reserve may keep raising interest rates to curtail inflation. Shares of Toyota Motor Corp. declined. The Bank of New York Co.'s Asia ADR Index, which tracks the region's American depositary receipts, lost 1.4 percent to 139.44. For the week, it dropped 1 percent.

The Canadian dollar was up a 0.2 of a cent to 88.99 cents US.