Chart and News for Thursday

Here's a chart of the S&P/TSX Composite ...

The S&P/TSX Composite often exhibits seasonal behavior. And one of its seasonal trends is a strong rally starting in the fourth quarter. Let’s look at a chart of the TSX over the past few years …

The S&P/TSX Composite started a rally in the fourth quarter of 2005 and didn’t take a break until it was 22.1% higher. Last year, the same thing happened for a 12.3% gain.

Maybe the 4th quarter rally is already underway. Maybe we’ll see another pullback before it really kicks in, and maybe, for one reason or another, it will never come. But the odds favor a strong rally in Canadian stocks through Christmas and beyond. You want your money in place to catch that ride.

In other news ...

Orders to U.S. Factories Probably Fell by Most in Seven Months in August Orders placed with U.S. factories probably fell in August by the most in seven months, raising concern the turmoil in credit markets eroded business confidence, economists said before a report today.

Talisman May Cut Budget by $500 Million on Proposal to Raise Royalties Talisman Energy Inc., a Canadian natural-gas and oil producer, said it's already cut its 2008 spending plan in Alberta by C$500 million ($502.6 million) because of low fuel prices and will slash another C$500 million should the province enact proposed increases in royalties.

Gold Drops for Third Straight Day in London as Euro Trades Near 1-Week Low Gold declined for a third consecutive session in London as the euro traded near the lowest in a week against the dollar, eroding the metal's appeal as an alternative investment.

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