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CANADA STOCKS-TSX may open higher on Spanish hopes

Tuesday, 2 Oct 2012 | 8:36 AM ET

Oct 2 (Reuters) - Canada's main stock index looked set for a higher open on Tuesday, as euro zone worries eased after a report ignited expectations of an imminent bailout request from Spain.

TOP STORIES

* Spanish Prime Minister Mariano Rajoy told regional leaders of his party that the state would not seek a euro zone bailout this weekend, news agency Europa Press reported.

* European officials told Reuters late on Monday that Spain was ready as early as next weekend to ask the euro zone and the European Central Bank to start buying its bonds, but Germany had signaled it should hold off.

* Banks should separate deposit taking from trading and other high-risk investment banking work to shield taxpayers from further bailouts and protect savers, an EU advisory group said.

* Euro zone factory prices jumped unexpectedly in August and by the biggest margin since January as rising oil prices increased inflation pressures across the bloc, limiting the European Central Bank's ability to cut interest rates again to support the shrinking economy.

* A U.S. court removed a temporary sales ban against Samsung Electronics Co Ltd's Galaxy Tab 10.1 won by Apple Inc in a patent dispute, allowing the South Korean company to sell the product in the U.S.

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MARKET SNAPSHOT * Canada stock futures traded up 0.55 percent * U.S. stock futures , , were up around 0.17 percent to 0.54 percent * European shares , were up COMMODITY PRICE MOVES

* Thomson Reuters-Jefferies CRB Index : 312.38; rose 0.23 percent

* Gold futures : $1,779.1; fell 0.08 percent * US crude : $92.8; rose 0.34 percent * Brent crude : $112.27; rose 0.07 percent * LME 3-month copper : $8,359.75; rose 0.83 percent CANADIAN STOCKS TO WATCH

* Air Canada : The most vocal union at the airline operator registered on Monday only minor concerns about the airline's request for more government relief on pension deficit payments, and indicated it could make a decision in coming days on whether to support the bid.

* Canadian Oil Sands Ltd. : The largest-interest owner of the Syncrude project said that operation produced an average of 318,900 barrels a day in September from 359,500 bpd in August, a fall of about 11.3 percent.

* Canadian Pacific Railway Ltd : The railroad operator said chief operations officer Mike Franczak resigned effective immediately, the latest top executive to leave the company.

ANALYST RECOMMENDATIONS

Following is a summary of research actions on Canadian companies reported by Reuters.

* Cervus Equipment Corp : CIBC starts coverage with sector outperformer and price target of C$24 citing its international and production diversification, higher yield, strong balance sheet and strength of the Deere brand.

* Rocky Mountain Dealerships Inc : CIBC starts coverage with sector performer rating and price target of C$12.50, says Rocky is well positioned to benefit from strong agriculture fundamentals in Western Canada and quickly recovering construction markets in Alberta driven by oil sands production.

* Keyera Corp : National Bank Financial raises price target to C$54 from C$53, after the company said it plans to invest C$210 million to boost recoveries of ethane and other high-margin natural gas liquids at the Rimbey gas plant

ON THE CALENDAR * No major Canadian economic data scheduled for release * Major U.S. events and data includes auto sales data ($1= $0.98 Canadian)

(Reporting by Chandrashekhar Modi; Editing by Jeffrey Hodgson)

((chandrashekhar.modi@thomsonreuters.com))

Keywords: MARKETS CANADA/STOCKS

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