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At the open: TSX flat, CP Rail higher after Ackman sells shares


The Toronto stock market was lower Friday at the end of a positive week with the TSX powered higher by earnings news and positive manufacturing data from China.

The S&P/TSX composite index edged up 1.39 points to 13,326.14, led by energy sector gains.

It's a quiet day for earnings out of Canada after a week that saw positive earnings reports from the likes of Teck Resources (TSX:TCK.B), Goldcorp (TSX:G), Canadian National Railways (TSX:CNR) and Canadian Pacific Railway (TSX:CP).

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CP was in focus Friday after its biggest shareholder sharply narrowed its position. Bill Ackman's Pershing Square Capital Management has sold about a third of its holding in in the railroad.

CP, which reported a record quarterly profit on Wednesday, said the hedge fund has sold 5.96 million CP shares for about US$140.00 a share, bringing the total divestment so far to seven million shares. On Friday morning, CP shares gained $1.43 to C$149.38, which is more than triple their level when Pershing Square began building up its stake in the railroad.

The Canadian dollar was down 0.17 of a cent to 95.75 cents US, down for a third day after the Bank of Canada removed its tightening bias and downgraded its economic forecast. The move led analysts to believe that interest rate hikes are off the table until 2015, leading the loonie to fall more than 1.25 cents this week.

U.S. indexes were higher amid earnings reports after the close from Amazon and Microsoft while consumer giant Procter & Gamble posted results Friday.

The Dow Jones industrials was ahead 25.48 points to 15,534.69, the Nasdaq ran up 26.21 points to 3,955.17 and the S&P 500 index rose 3.62 points to 1,755.69.

Meanwhile, traders continued to take in economic reports that were held up during the partial U.S. government shutdown for more than half of October.

The latest data showed that durable goods orders for September were up 3.7 per cent. Minus transportation orders, durable goods orders actually slipped 0.1 per cent.

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After the close Thursday, posted a quarterly loss of $41 million, or nine cents per share, matching analyst expectations. Revenue jumped 24 per cent $17.09 billion against expectations of $16.76 billion and its stock surged US$27.17 or 8.18 per cent to $359.38.

Microsoft's net income in three months through Sept. 30 grew 17 per cent to $5.24 billion, or 62 cents per share, from $4.47 billion, or 53 cents per share, a year ago. That beat the 54 cents expected by analysts. Revenue rose 16 per cent to $18.53 billion, also beating the $17.79 billion analysts were expecting and its shares were ahead $2.17 or 6.44 per cent to $35.89.

On Friday, Procter & Gamble says its first-quarter net income rose eight per cent to $3.03 billion, or $1.04 per share. That compares with net income of $2.81 billion, or 96 cents per share, last year. Excluding one-time items net income was $1.05 per share, matching analyst expectations.

Revenue rose two per cent to $21.2 billion. But analysts expected revenue of $21 billion and its shares slipped 25 cents to $80.36.

Brookfield Office Properties Inc. (TSX:BPO) says its funds from operations was $167 million or 29 cents per diluted share and net operating income from commercial properties was $223 million, both virtually the same as a year earlier.

The company, a subsidiary of Toronto-based Brookfield Asset Management (TSX:BAM.A), also says it expects about six cents per share of one-time items this year, including costs related to a major acquisition in downtown Los Angeles that closed in the fourth quarter. Brookfield Office Properties was three cents higher to $19.55 while Brookfiield Asset Management slipped six cents to $42.06.

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Commodities were mixed with as December crude inched ahead 28 cents to US$97.39 a barrel and the TSX energy sector climbed 0.32 per cent. Suncor Energy (TSX:SU) gained 48 cents to $37.55.

The TSX gold sector led decliners, down 1.4 per cent while December bullion faded $7.40 to US$1,342.90 an ounce. Goldcorp (TSX:G) dropped 72 cents to C$27.04.

The base metals component gave back 0.77 per cent as December copper lost two cents to US$3.24 a pound. Teck Resources was 37 cents lower to $30.17.

European bourses were mainly higher with London's FTSE 100 index up 0.13 per cent, Frankfurt's DAX rose 0.17 per cent and the Paris CAC 40 was flat.

Earlier in Asia, Seoul's Kospi slipped 0.6 per cent while Hong Kong's Hang Seng fell 0.6 per cent and China's Shanghai Composite Index was off 1.5 per cent.

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