Tuesday, December 1, 2009 11:17 AM
Benchmark to grow again
Simon Avery
For the first time in seven quarters, the Toronto Stock Exchange’s benchmark S&P/TSX composite index looks set to add more stocks than it deletes.
As additions and subtractions are based on value and liquidity criteria, it’s no surprise that during the market mayhem last year, many companies saw their stocks removed. In fact, membership dropped by 20 per cent, to 203 names from 256, during that period.
On Friday Dec. 11, Standard & Poor’s is expected to detail its quarterly rebalance of the S&P/TSX, with all changes to take effect one week later.
Derek Euale, an analyst with CIBC World Markets, expects that there will be nine additions and one deletion.
The probable additions he cites are: Cott Corp., Brookfield Renewable Power Fund, Centerra Gold Inc., Celtic Exploration, Gabriel Resources Ltd., Lake Shore Gold Corp., Rubicon Minerals Corp., Semafo Inc. and Ventana Gold Corp.
The only deletion he expects is Cardiome Pharma Corp.
In addition, Manulife’s weighting will increase to reflect the company’s issuance of $2.5-billion in equity. That change will be effective after the close of trading today, he wrote in a report.
Among the smaller TSX 60 index, Mr. Euale expects that Cenovus Energy Inc. will be added and Groupe Aeroplan Inc. will be dropped after the close on Wednesday. EnCana will also remain in the TSX 60 Index with the same ticker after spinning out Cenovus.
