Stocks flat by noon

The Toronto stock market was flat late Monday morning following last week's retreat and despite good U.S. economic news and a solid profit from Ford Motor Co.

As of noon nour, the S&P/TSX composite index was off 53.29 points to 10,857.46.

Fresh doubts about the strength of the economic recovery pushed the main index down more than 4% last week, leading to the first monthly loss since February.

RIM shares fell $4.23 or 6.6% to $59.59 after Citigroup analyst Jim Suvam reduced his rating on the stock to "sell" from "buy" because of the impact of competing smart phones, especially Motorola Inc. phones using Google Inc.'s Android operating system.

TSX gains were led by the gold sector, as the December bullion contract on the New York Mercantile Exchange gained ground. Barrick Gold Corp. gained 49 cents to $39.45.

The base metals sector advanced even as December copper was unchanged at $2.96 U.S. a pound.

Inmet Mining Corp. gained $1.74 to $59.08.

The energy sector was flat as But EnCana Corp. rose 54 cents to $60.54.

The financial sector was off with Royal Bank down 54 cents to $54.26.

Uranium miner Cameco Corp. shares declined 41 cents to $29.75 after it reported that net income rose to $172 million or 44 cents per share in the third quarter, up from $135 million or 39 cents per share in the same period of 2008. Adjusted net income was $104 million or 26 cents per share, down from $127 million or 37 cents per share in the third quarter of 2008. Revenue was $694 million, down from $729 million.

On Friday, Cameco said it has resumed draining its flooded Cigar Lake project and expects to have the mine pumped out sometime next year.

The Canadian dollar gained 0.70 cents to 92.90 cents U.S.

ON BAYSTREET

The 14 TSX subgroups were evenly divided between winners and losers. Gold led the seven gainers, picking up 1.3%, followed by health-care stocks, up 1%, and global base metals, ahead 0.8%.

Information technology was the weightiest of the seven downward groups, off 2.1%, real-estate was off 1.2% and metals and mining stocks were down 0.5%.

The TSX Venture Exchange was up 10.50 points to 1,301.91, while the Nasdaq Canada index faded 22.30 points to 609.79.

ON WALLSTREET

In New York, a stock rally gained momentum Monday following a much stronger-than-expected manufacturing report and strength on the housing front.

Stocks moved higher right out of the gate after Ford reported its first quarterly profit in more than a year.

The Dow Jones Industrials had picked up 69 points to 9.781.73. The S&P 500 index eked out a gain of 4.77 points to 1,040.96. The Nasdaq composite index let go of 8.67 points to 2,050.37.

With consumers still keeping their wallets closed, "this recovery is being led by businesses and exports, so obviously the market's going to pay attention to this type of data," one expert said.

"The manufacturing sector is seen as a main component of recovery being sustainable."

Gains were broad-based, with 26 of the 30 Dow components higher.

Stocks had tumbled Friday on worries that the market was due for a correction, bringing Wall Street's seven-month winning streak to a halt in October.

Ford Motor delivered its first quarterly profit in more than a year Monday, helped by the government's Cash for Clunkers program.

The company said it earned nearly $1 billion U.S., or 29 cents U.S. a share. The automaker was expected to post a loss of 12 cents U.S. a share, according to Thomson Reuters estimates.

Ford shares rose 9% in early trading Monday.

On the economic front, three reports helped lift investor sentiment Monday.

A survey by the Institute for Supply Management showed nationwide manufacturing activity jumped to 55.7 in October, from 53 the previous month. Economists surveyed by Briefing.com had predicted a more modest gain to 54. Numbers above 50 signal growth, while figures below 50 suggest contraction.

The Commerce Department said construction spending rose unexpectedly by 0.8%. Economists surveyed by Briefing.com were anticipating a 0.5% decline.

Meanwhile, the National Association of Realtors reported that the number of signed sales contracts to buy homes rose in September for the eighth straight month. Pending home sales rose much more than expected, by 6.1%, in September. Analysts were looking for a 1.2% increase.

Small business lender CIT filed the fifth-largest U.S. bankruptcy on Sunday as part of a reorganization plan that has the support of most of the company's debtholders.
CIT said it has already worked out a reorganization plan with bondholders that it expects to speed the Chapter 11 process and reduce CIT's debt by $10 billion U.S..

Treasury prices were down, raising the yields for the benchmark 10-year note to 3.40% from Friday's 3.39%. Prices and yields move in opposite directions.

The price of a barrel of oil picked up 79 cents to $77.79 U.S.

Gold prices dropped $7 to $1,040 U.S. an ounce.