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These are stories Report on Business is following Wednesday, Aug. 14, 2013.

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National home prices rise
The sky is not falling. Neither are Canadian home prices.

In fact, residential real estate prices climbed 1.9 per cent in July from a year earlier, a slight pick-up from the pace registered in June by the Teranet-National Bank home price index.

On a monthly basis, prices rose 0.7 per cent from June.

While the 12-month gain rose marginally in July from a month earlier, when it was 1.8 per cent, senior economist Marc Pinsonneault of National Bank of Canada noted that the increases in both were the slowest since November of 2009.

Year over year, prices rose 6.7 per cent in Hamilton, 5.9 per cent in Calgary, 3.8 per cent in Quebec City, 3.5 per cent in Edmonton, 3.4 per cent in Toronto, 3.2 per cent in Winnipeg, 1.5 per cent in Halifax, 1.1 per cent in Montreal and 0.9 per cent in the Ottawa region.

Prices slipped for the 12 consecutive month in Vancouver, down 2 per cent, and fifth month in a row in Victoria, down 4 per cent.

The month-over-month reading tells a different story, though. By that measures, prices gained 2.6 per cent in Victoria, 1.8 per cent in Hamilton, 1.3 per cent in Toronto, 0.8 per cent in Edmonton, 0.5 per cent in Calgary, and 0.3 per cent in Vancouver, Quebec City and the Ottawa area.

Prices were flat in Montreal, and slipped in Halifax and Winnipeg, by 0.6 per cent and 0.4 per cent, respectively.

"While it is true that existing home sales strengthened in July in the two largest metropolitan areas in Canada, namely [Toronto] and Vancouver, the recent rise in mortgage rates have, according to our calculations, decreased affordability to its lowest level since the beginning of the last recession," Mr. Pinsonneault said.

"We therefore expect sales to cool over the coming months, with monthly change in home prices remaining subdued. However, we expect year-over-year home price inflation to increase starting August due to base effects."

As The Globe and Mail's Tara Perkins reports, the Canadian market has proved to be remarkably resilient a year after the government tightened up mortgage rules.

Euro zone climbs out of recession
There's no question that the economic signals from Europe are improving, but some countries remain depressed.

As our European correspondent Eric Reguly reports today, fresh numbers show the 17-member euro zone emerged from recession with economic growth of 0.3 per cent in the second quarter of the year.

That was on the back of stronger performances by Germany and France, whose economies expanded by 0.7 per cent and 0.5 per cent, respectively.

But countries such as Greece, Spain and Italy are still hobbled, today's numbers illustrate.

Europe, of course, is also still struggling with elevated jobless levels and still-high government.

"Over all, the end of the euro zone recession and the strengthening of the U.S. recovery suggest that global growth will continue, albeit at a relatively modest pace by historical standards," said senior economist Andrew Kenningham of Capital Economics in London.

Apple at $500
Shares of Apple Inc. are hovering at around the $500 (U.S.) mark today, still basking in the glow of just two tweets from Carl Icahn.

The stock rose yesterday after the activist investor, who's new to Twitter but is clearly having fun, posted two tweets, but two key ones given that he's only ever done 12.

He disclosed that he holds a "large" stake in the tech giant, has spoken to Apple CEO Tim Cook and plans to speak to him again, and believes the company should fatten up its stock buyback.

It's not just Icahn's interest, which is believed to be worth more than $1-billion. The shares are also being buoyed by speculation of new devices to be unveiled next month.

And $500 certainly isn't enough for Mr. Icahn, who believes the shares could be at the $700 level.

He believes Apple could borrow money at a rate of 3 per cent, and boost its share buyback to $150-billion.

Apple already plans a buyback of $60-billion by the end of 2015, compared last year's program of $10-billion.

For anyone who didn't catch @Carl_C_Icahn yesterday, here's what he tweeted:

Tweet 1: "We currently have a large position in APPLE. We believe the company to be extremely undervalued. Spoke to Tim Cook today. More to come."

Tweet 2: "Had a nice conversation with Tim Cook today. Discussed my opinion that a larger buyback should be done now. We plan to speak again shortly."

The stock gained a further 1.8 per cent today to close at $498.50, having topped $500 earlier in the day.

The smartphone race
Microsoft Corp. has overtaken BlackBerry Ltd. for the No. 3 spot among smartphone operating systems, new research shows, while Google Inc.'s Android still rules the world.

Today's statistics from Gartner Inc. showed devices running on Microsoft captured 3.3 per cent of the global market in the second quarter of the year, outpacing, for the first time, the 2.7 per cent of the BlackBerry operating system.

A year ago, BlackBerry held 5.2 per cent, and Microsoft 2.6 per cent.

The popular Android system continued to show hefty gains, rising to capture 79 per cent of the market, compared to 64.2 per cent a year earlier.

The market share held by Apple Inc.'s iOS slipped to 14.2 per cent from 18.8 per cent, Gartner said.

"While Microsoft has managed to increase share and volume in the quarter, Microsoft should continue to focus on growing interest from app developers to help grow its appeal among users," said Gartner research analyst Anshul Gupta.

In terms of smartphone sales, Samsung ruled again in the second quarter, with 31.7 per cent of the market, or 71.4 million devices. Apple came in at 14.2 per cent or almost 32 million, followed by LG Electronics and ZTE.

The fresh numbers come as both Apple and BlackBerry are moving targets.

BlackBerry, whose shares rose again today, essentially put out a "for sale" sign on Monday as a special committee of its board looks at strategic options.

One holdout at Bank of England
Mark Carney hasn't received the full backing of the Bank of England's policy makers for his plan to tie interest rate hikes to jobless levels, The Globe and Mail's Paul Waldie reports from London.

Mr. Carney said last week that under the new "forward guidance" policy, the bank would not increase its benchmark rate from 0.5 per cent until unemployment fell to 7 per cent from its current level of 7.8 per cent. The bank noted that it could take up to three years for that to happen.

The threshold was subject to some conditions, or "knockouts," including any indication that inflation would stay above 2.5 per cent for 18 to 24 months. If that happened, the bank could act sooner to raise rates.

Minutes released today from the bank's monthly meeting of its nine-member Monetary Policy Committee, which sets the bank rate, show Mr. Carney's plan did not receive unanimous support.

According to the minutes, one MPC member, economist Martin Weale, voted against it. Mr. Weale indicated that while he supported the idea in principle, he was concerned that the forward guidance policy could send inflation rising much faster and that the 18- to 24-month time frame to judge the inflation outlook was too short.

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