Thursday, March 25, 2010

*Click on title to view Comments **Click here to view Calendar of Events

Large Cap Stocks

ICL Group Q4/09 Results Slightly Below Consensus E. Chee

AGF Management Q1/10 Results: A Solid Start to Fiscal 2010 J. Reucassel

Small Cap Stocks

Black Diamond Group Q4/09 Results: Does It Really Matter? M. Mazar

Martinrea International Lowering Target Price; Q4/09 Adjusted Earnings Substantially Weaker Than Expected on Strong Revenue Gains

P. Sklar

Orleans Energy Q4/09 Results in Line M. Leggett

Stoneham Drilling Trust Coverage Discontinued M. Mazar

Industry/Macro Comments

Global Commodity Strategy Gold Correction Represents Buying Opportunity —Skyrocketing U.S. Federal Debt the Catalyst

B. Melek

Quantitative Analysis Relative Strength Filter — Drillers M. Steele

Quantitative Analysis Market Elements M. Steele

Economic Research A.M. Notes Economics

Disclosure Statements To view important Disclosure Statements go to http://research-ca.bmocapitalmarkets.com/Company_Disclosure_Public.asp

Thursday, March 25, 2010

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Earnings & Conference Calls Orleans Energy (OEX) CFPS Q4/09 BMO CFPS $0.08 vs. $0.17 last year; First Call Mean $0.08

Premier Oil (PMO) CFPS H2/09 BMO CFPS £1.93 vs. £1.13 last year

Franco-Nevada (FNV) EPS Q4/09 BMO EPS US$0.14 vs. US$0.15 last year; First Call Mean US$0.105 FY/09 BMO EPS US$0.25 vs. US$0.41 last year; First Call Mean US$0.216

647-427-7450 or 888-231-8191; Replay: 416-849-0833 or 800-642-1687 (Passcode: 59483656); Webcast: www.franco-nevada.com

Mar. 2610:00 am

Today's Events & Marketing

Redback Mining (RBI) Company presentation in Europe. Rick Clark (CEO) and Simon Jackson (VP, Corporate Development).

Dave Shove (Managed Care and Pharmacy Benefit Managers Analyst)

Marketing in Kansas City, Dallas & Austin

Edwin Chee (Chemicals & Fertilizers Analyst) Marketing on the West Coast

Ken Zaslow (Food & Agribusiness Analyst) Marketing San Francisco & Los Angeles

Mike Mazar (Oil & Gas Services Analyst) Marketing in Kansas City

John Reucassel (Financials Analyst) Marketing in New York

MOSAID Technologies (MSD) Company presentation in Toronto. Michael Salter (Director, Investor Relations & Corporate Communications).

Flowserve (FLS) Company presentation in New York. Dean Freeman (Sr. VP Finance & Treasurer), Kyle Ahlfinger (VP, Chief Marketing Officer) and Paul Fehlman (VP, Financial Planning & Analysis and IR).

Marvell Technology (MRVL) Company presentation in Toronto & Montreal. Jeff Palmer (VP of Investor Relations).

Peyto Energy Trust (PEY.UN) Company presentation in Toronto. Darren Gee (President & CEO).

Dan Salmon (Marketing Services & Advertising Agencies Analyst)

Marketing in Kansas City & Dallas

Bert Powell (Special Situations Analyst) Marketing in Vancouver & Alberta

Christopher Brown (Oil & Gas International Producers Analyst)

Marketing in Europe

Winn-Dixie Stores (WINN) Company presentation in New York

BMO Capital Markets Calendar of Events

Page 2 March 25, 2010 (Back to Index)

Economics/Industry Data

Time Data Period BMO Capital Markets Estimate

Previous Period

Consensus

8:30 am U.S. Initial Claims Mar. 20 (e) 450,000 (-7,000) 457,000 (-5,000) 450,000 (-7,000)

Upcoming Events & Marketing

Marvell Technology (MRVL) Company presentation in Toronto & Montreal. Jeff Palmer (VP of Investor Relations). Mar. 25-26

Peyto Energy Trust (PEY.UN) Company presentation in Toronto. Darren Gee (President & CEO). Mar. 25-26

Dan Salmon (Marketing Services & Advertising Agencies Analyst)

Marketing in Kansas City & Dallas Mar. 25-26

Bert Powell (Special Situations Analyst) Marketing in Vancouver & Alberta Mar. 25-26

Christopher Brown (Oil & Gas International Producers Analyst)

Marketing in Europe Mar. 25-26

Winn-Dixie Stores (WINN) Company presentation in New York Mar. 25-26

Peter Sklar (Auto Parts/Food & Drug Retailing Analyst)

Marketing in Vancouver Mar. 26

Joanne Wuensch (Medical Technology & Devices Research Analyst)

Marketing Florida Mar. 26

Linamar (LNR) Company presentation in Montreal. Linda Hasenfratz (CEO) and Mark Stoddart (Chief Technology Officer & Executive VP, Marketing).

Mar. 26

Carl Kirst (North American Pipeline Analyst) Marketing in Montreal Mar. 29

Bunge (BG) Company presentation in Boston. Jackie Fouse (CFO) and Mark Haden (Director of Investor Relations).

Mar. 29

Alan Laws (Oil Services Analyst) Marketing in Atlanta Mar. 29

Tim Long (Communications Equipment Analyst) Marketing in the Mid-Atlantic Mar. 29

TELUS (T) Company presentation in New York & Boston. Bob McFarlane (EVP & CFO) and Robert Mitchell (Investor Relations).

Mar. 29

EnCana (ECA) Company presentation in Los Angeles & San Francisco. Mike McAllister (VP, Canadian Deep Basin (Montney & Bighorn)), Todd Brown (Team Lead, Texana (Haynesville)) and Ryder McRitchie (VP, Investor Relations).

Mar. 29-31

TELUS (T) Company presentation in Montreal. Bob McFarlane (EVP & CFO) and Robert Mitchell (Investor Relations).

Mar. 30

BMO Capital Markets Calendar of Events

Page 3 March 25, 2010 (Back to Index)

Bert Hazlett (Pharmaceuticals Analyst) Marketing in Boston Mar. 30

Karen Short (Food Retailing Analyst) Marketing in Chicago Mar. 30

Artis REIT (AX.UN) Company presentation in Chicago. Armin Martens (President & CEO) and Jim Green (CFO).

Mar. 31

Ballard Power Systems (BLD) Company presentation in Toronto Mar. 31

Mike Vinciquerra (Exchanges & Discount Brokers Analyst)

Marketing in Boston Mar. 31

Dan Salmon (Marketing Services & Advertising Agencies Analyst)

Marketing in Chicago Mar. 31-Apr. 1

Karine MacIndoe (Real Estate & REITs Analyst) Marketing in the Mid-Atlantic region Apr. 1

Dan Salmon (Marketing Services & Advertising Agencies Analyst)

Marketing in the Pacific Northwest Apr. 5

Wayne Hood (Broadline Retailing Analyst) Marketing in New York Apr. 5-6

Andrew Kaip (Precious Metals & Mining Analyst) Marketing in Boston & New York Apr. 5-7

INV Metals (INV) Company presentation in Toronto. Bob Bell (President & CEO) and Candace MacGibbon (CFO).

Apr. 6

Gordon Tait (Royalty & Income Trusts Analyst) Marketing in Vancouver Apr. 6

Meredith Bandy (Coal Analyst) Marketing in Boston Apr. 6

Connie Maneaty (Personal Care & Household Products Analyst)

Marketing in Richmond & Atlanta Apr. 6

Lana Chan & Peter Winter (Financial Institutions Analysts) Marketing in Texas Apr. 6-8

Gammon Gold (GAM) Company presentation in Boston & New York. Scott Perry (CFO) and Anne Day (Director, IR).

Apr. 6-9

Joanne Wuensch (Medical Technology & Devices Research Analyst)

Marketing in the Mid-West Apr. 7

Karine MacIndoe (Real Estate & REITs Analyst) Marketing in Vancouver Apr. 7

Claude Proulx (Airlines & Special Situations Analyst) Marketing in Toronto Apr. 7-8

BMO Capital Markets Calendar of Events

Page 4 March 25, 2010 (Back to Index)

Cap REIT (CAR.UN) Company presentation in Winnipeg & Vancouver. Tom Schwartz (President & CEO) and Richard Smith (CFO).

Apr. 7-8

Christopher Brown (Oil & Gas International Producers Analyst)

Marketing in Winnipeg Apr. 8

Alan Laws (Oil Services Analyst) Marketing in New York & Connecticut Apr. 8-9

Christopher Brown (Oil & Gas International Producers Analyst)

Marketing in Toronto Apr. 9

Carl Kirst (North American Pipeline Analyst) Marketing in Boston Apr. 12

Wayne Hood (Broadline Retailing Analyst) Marketing in Europe Apr. 12-14

Gammon Gold (GAM) Company presentation in Texas, L.A. & San Francisco. Scott Perry (CFO) and Anne Day (Director, IR).

Apr. 12-14

Alpha Natural Resources (ANR) Company presentation in Europe. Kevin Crutchfield (CEO), Frank Wood (CFO) and Allen Todd (VP, IR).

Apr. 12-15

Alpha Natural Resources (ANR) Company presentation in Europe. Kevin Crutchfield (CEO), Frank Wood (CFO) and Allen Todd (VP, Investor Relations).

Apr. 12-16

Detour Gold Corp. (DGC) Company presentation in Europe Apr. 12-16

New Gold (NGD) Company presentation in Europe Apr. 12-16

Randy Ollenberger (Oil & Gas Producers & Integrated Oils Analyst)

Marketing in Toronto Apr. 13-15

Gordon Tait (Royalty & Income Trusts Analyst) Marketing in Montreal Apr. 14

General Mills (GIS) Company presentation in the Mid-Atlantic. Don Mulligan (CFO) and Kristen S. Wenker (VP, Investor Relations).

Apr. 14

Carl Kirst (North American Pipeline Analyst) Marketing in the Mid-West Apr. 14-15

Jim Byrne (Integrated Oils & Refiners Analyst) Marketing in Vancouver Apr. 15

Paul Adornato & Richard Anderson (U.S. REITs Analysts) Marketing in Boston Apr. 15

Jeffrey Logsdon (Entertainment & Gaming Analyst) Marketing in Boston Apr. 15-16

Gammon Gold (GAM) Company presentation in Toronto. Scott Perry (CFO) and Anne Day (Director, IR). Apr. 16

BMO Capital Markets Calendar of Events

Page 5 March 25, 2010 (Back to Index)

Randy Ollenberger (Oil & Gas Producers & Integrated Oils Analyst)

Marketing in Montreal Apr. 16

Osisko Mining (OSK) Company presentation in Europe Apr. 19-23

Gordon Tait (Royalty & Income Trusts Analyst) Marketing in Toronto Apr. 20-21

Alamos Gold (AGI) Company presentation in Europe. John A. McCluskey (President and CEO) and Jeremy Link (Investor Relations Manager).

Apr. 21

John Morris (Apparel Retail Analyst) Marketing in the Pacific Northwest Apr. 21

Pacific Rubiales (PRE) Company presentation in Europe Apr. 22-23

Romarco (R) Company presentation in Europe Apr. 26-27

If you are interested in any of the above events, please contact your BMO Capital Markets Institutional Equity/Fixed Income salesperson, or the following: Toronto Events: Laura Heuff 416-359-5816 Montreal Events: Marjorie Heppell at 514-286-7231 Western Canada Events: Jennifer Crombie 604-443-1452 U.S. Events: Angela Dong 212-702-1969 Europe Events: Hannah Pead 44-207-246- 5418 Sources: BMO Capital Markets; Thomson StreetEvents (www.streetevents.com)

This report was prepared by an analyst(s) employ d as a research analyst(s) under FINRA rules. For disclosure statements, including

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ICL Group (ICL-TASE) Stock Rating: OutperformIndustry Rating: Outperform

March 24, 2010 Research Comment Toronto, Ontario

Edwin Chee (416) 359-6193 Edwin.Chee@bmo.com Assoc: Harriet Li, CA / Bobby Kalsi

Price (23-Mar) NIS 50.74 52-Week High NIS 55.44 Target Price NIS 65.00 52-Week Low NIS 32.50

Q4/09 Results Slightly Below Consensus ICL Group(ICL)

Price: High,Low,Close

ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 4 to 6.

Event ICL reported Q4/09 EPS of $0.16. Adjusted for one-time items related to the

shutdown of a production facility in the Performance Products segment and

provisions related to the early retirement of employees, operating EPS were

$0.17, which was below the First Call Mean of $0.19 but above our estimate of

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Impact Neutral. Potash segment operating earnings were 15% better than expected as

7% higher than expected realized prices offset 7% weaker than expected sales

volumes. Operating income in the phosphate segment was slightly ($2.1

million) weaker than anticipated while operating income from the Industrial

Products and Performance Products segments exceeded expectations by 19%

and 41%, respectively.

Forecasts Our estimates remain unchanged. Going forward, we anticipate potash segment

sales volumes will particularly benefit from recent agreements reached between

ICL and various Indian customers.

Valuation Our target price of NIS 65 corresponds to EV/EBITDA multiples of 20.6x and

16.1x 2010 and 2011 estimates, respectively.

Recommendation As global potash markets continue to revive, we should see an improvement in

ICL’s sales volumes as demand in offshore markets accelerates towards the

latter part of this year. We continue to rate ICL stock Outperform.

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(FY-Dec.) 2008A 2009A 2010E 2011E EPS $1.56 $0.61 $0.58 $0.78 P/E 86.3x 64.1x CFPS $1.71 $0.80 $0.73 $0.93 P/CFPS 68.7x 53.9x Rev. ($mm) $6,904 $4,554 $4,924 $5,703 EV ($mm) $19,769 $14,494 $18,056 $17,657 EBITDA ($mm) $2,518 $1,143 $1,094 $1,378 EV/EBITDA 7.9x 12.7x 16.5x 12.8x Quarterly EPS Q1 Q2 Q3 Q4 2008A $0.27 $0.54 $0.60 $0.14 2009A $0.13 $0.12 $0.20 $0.16 2010E $0.15 $0.13 $0.14 $0.16 Dividend $0.22 Yield 0.4% Book Value $2.19 Price/Book 23.2x Shares O/S (mm) 1,271.1 Mkt. Cap (NIS mm) NIS 64,496Float O/S (mm) 447.0 Float Cap (NIS mm) NIS 22,681Wkly Vol (000s) 14,444 Wkly NIS Vol (mm) NIS 637.2 Net Debt ($mm) $1,089.3 Next Rep. Date 24-May (E)

Notes: Share price and market capitalization in New Israeli Shekels, all other values in US$ Major Shareholders: The Israel Corporation (51.5%), Potash Corp. of Saskatchewan (10.1%) First Call Mean Estimates: Not Available

This report was prepared by an analyst(s) employ d as a research analyst(s) under FINRA rules. For disclosure statements, including

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AGF Management (AGF.B-TSX) Stock Rating: Market PerformIndustry Rating: Market Perform

March 25, 2010 Research Comment Toronto, Ontario

John Reucassel, CFA (416) 359-4379 John.Reucassel@bmo.com Assoc: Natalie Medak

Price (24-Mar) $18.77 52-Week High $18.85 Target Price $20.00 52-Week Low $7.70

Q1/10 Results: A Solid Start to Fiscal 2010

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AGF Management Cl B (AGF.B)Price: High,Low,Close Earnings/Share

ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 9 to 11.

Event AGF reported Q1/10 fully diluted EPS of $0.34 compared with consensus of

$0.35 and our estimate of $0.32.

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Impact

Slightly Positive.

Forecasts We increased our 2010E and 2011E EPS to $1.50 and $1.80, respectively, from

$1.45 and $1.75, reflecting lower SG&A expenses in wealth management. We

also increased our 2010E and 2011E wealth management EBITDA to $220

million and $245 million, respectively, from $215 million and $240 million.

Valuation We increased our target price to $20.00 from $17.50, reflecting 7x 2010E

EBITDA. We continue to value the trust operations at 1.0x current book value.

Recommendation AGF remains rated Market Perform. The wealth management business, and its

ability to generate flows, remains key to long-term value creation at AGF.

While stronger equity markets have improved wealth management EBITDA,

fund flows continue to be challenging given modest gross sales activity. New

products expected to be announced in Q2/10 should help flows; however, we

continue to believe that the rise of the banks and other large players makes this a

very competitive market. Despite the challenges in mutual fund net flows,

AGF’s institutional operations continue to benefit from new mandates. Credit

trends at the Trust Operations were stable during the quarter. Of the $876

million in cash and investments on the balance sheet, $812 million is in the

regulated trust business and is unlikely to be available for AGF shareholders.

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(FY-Nov.) 2008A 2009A 2010E 2011E EPS $1.44 $1.09 $1.50 $1.80P/E 12.5x 10.4x CFPS $3.10 $2.31 $2.51 $2.84P/CFPS 7.5x 6.6x Rev. ($mm) $606 $475 $519 $551 EV ($mm) $737 $1,500 $1,446 $1,142 EBITDA ($mm) $268 $182 $220 $245 E

V/EBITDA 2.8x 8.2x 6.6x 4.7x

Quarterly EPS Q1 Q2 Q3 Q4 2008A $0.70 $0.49 $0.46 -$0.21 2009A $0.14 $0.19 $0.25 $0.50 2010E $0.34a $0.37 $0.38 $0.41 Dividend $1.04 Yield 5.5% Book Value $12.74 Price/Book 1.5x Shares O/S (mm) 89.3 Mkt. Cap ($mm) $1,676 Float O/S (mm) 79.6 Float Cap ($mm) $1,494 Wkly Vol (000s) 1,373 Wkly $ Vol (mm) $18.3 Net Debt ($mm) $120.7 Next Rep. Date 23-Jun (E)

Notes: All values in C$; EPS ex. acquisition goodwill; Rev incl. mgmt & admin fees only; EBITDA ex. trust ops; Non-Voting Major Shareholders: Senior management and directors (5% of non-voting shares); AIC (9% of non-voting shares) First Call Mean Estimates: AGF MANAGEMENT LTD (C$) 2010E: $1.44; 2011E: $1.68

Changes Annual EPS Annual CFPS Quarterly EPS Target 2010E $1.45 to $1.50 2010E $2.56 to $2.51 Q2/10E $0.34 to $0.37 $17.50 to $20.00 2011E $1.75 to $1.80 2011E $2.86 to $2.84

This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 5 to 8.

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Black Diamond Group (BDI-TSX) Stock Rating: OutperformIndustry Rating: Market Perform

March 24, 2010 Research Comment Calgary, Alberta

Michael Mazar, CFA (403) 515-1538 Michael.Mazar@bmo.com Assoc: Jason A. Zhang

Q4/09 Results: Does It Really Matter?

Event Black Diamond reported diluted Q4/09 EPS of $0.33, above our estimate of

$0.29 and consensus of $0.28. However, the better-than-anticipated earnings

resulted from an unexpected tax recovery as EBITDA of $5.6 million was below

our forecast of $9.2 million.

Impact Mixed.

Forecasts Our 2010 and 2011 earnings estimates remain unchanged. We expect the

company to generate diluted EPS of $1.47 and $1.96 in 2010 and 2011

respectively.

Valuation We view the modest sell-off following the weaker-than-expected quarterly

results as a knee-jerk reaction to a largely irrelevant event. We continue to

believe that Black Diamond’s shares are attractively valued at 5.9x 2010E and

4.7x 2011E EBITDA. In our view, the shares should trade at a premium to the

group in light of Black Diamond’s superior growth profile, high level of longer-

term contract coverage, attractive dividend yield, low payout ratio and lower

exposure to the highly cyclical drilling and well services markets.

Recommendation We are maintaining our Outperform rating and $22 target price.

Price (24-Mar) $19.29 52-Week High $20.00 Target Price $22.00 52-Week Low $6.90

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(FY-Dec.) 2008 A 2009A 2010E 2011E EPS $1.85 $1.54 $1.47 $1.96 P/E 13.1x 9.8x CFPS $3.05 $2.65 $3.47 $4.26P/CFPS 5.6x 4.5x Total Debt ($mm) $42.0 $31.5 $67.1 $24.0 ROCE (%) 16% 12% 11% 14% LT Liab. (%) 26% 17% 27% 11% EV/EBITDA 3.6x 7.8x 5.9x 4.7x Quarterly EPS Q1 Q2 Q3 Q4 2008A $0.42 $0.49 $0.43 $0.51 2009A $0.77 $0.29 $0.19 $0.33 2010E $0.40 $0.28 $0.39 $0.39 Dividend $1.08 Yield 5.6% Book Value $11.02 Price/Book 1.8x Shares O/S (mm) 16.1 Mkt . Cap ($mm) $311 Float O/S (mm) 16.1 Float Cap ($mm) $311 Wkly Vol (000s) 151 Wkly $ Vol (mm) $2.1 Net Debt ($mm) $31.4 Next Rep. Date May (E)

Notes: All values in C$ Major Shareholders: Widely Held First Call Mean Estimates: BLACK DIAMOND GROUP LTD (C$) 2009E: $1.52; 2010E: $1.59; 2011E: $1.86

Changes Annual CFPS Quarterly EPS 2010E $3.54 to $3.47 Q1/10E $0.39 to $0.40 2011E $4.47 to $4.26 Q2/10E $0.29 to $0.28 Q3/10E $0.37 to $0.39 Q4/10E $0.40 to $0.39

This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 5 to 7.

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Martinrea International (MRE-TSX) Stock Rating: OutperformIndustry Rating: Outperform

Member of: Top 15 Small Cap Stock Selections Top 15 Value Stock Selections

March 24, 2010 Research Comment Toronto, Ontario

Peter Sklar, CA (416) 359-5188 Peter.Sklar@bmo.com Assoc: Andrew McKendry, CA, CFA

Lowering Target Price; Q4/09 Adjusted Earnings Substantially Weaker Than Expected on Strong Revenue Gains

Event On March 23, 2010, after the market close, Martinrea reported Q4/09 adjusted

earnings of $0.10 per share versus a Q4/08 loss on the same basis of $0.02 per

share. On a GAAP basis, Martinrea reported a Q4/09 loss of $0.06 per share

versus a Q4/08 loss of $3.99 per share.

Impact Negative. Q4/09 adjusted earnings were weaker than our forecast for earnings

of $0.15 per share and the consensus mean estimate of $0.14 per share.

Adjusted EBIT was well below expectations owing to inefficiencies associated

with the SKD takeover work. On a positive note, Martinrea announced new

business wins totalling $140 million.

Forecasts Reflecting ongoing uncertainty regarding the ultimate profitability of SKD, we

have lowered our 2010 earnings estimate to $0.67 from $0.87 per share. We

have revised our 2011 earnings estimate to $1.25 from $1.50 per share.

Valuation Largely based on the downward revisions to our earnings estimates, we have

revised our target price for Martinrea to $11 from $12. Our revised target is

based on a projected enterprise value that is 4.2x (previously 3.5x) our revised

2011 EBITDA forecast.

Recommendation We believe Martinrea will ultimately work through the SKD-related operating

inefficiencies although the return from SKD may not be as strong as we had

previously anticipated. The company has a strong balance sheet and the

opportunity to be a consolidator of this sector. We rate Martinrea Outperform.

Price (23-Mar) $9.45 52-Week High $9.72 Target Price $11.00 52-Week Low $2.25

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Last Data Point: March 23, 2010

(FY-Dec.) 2008 A 2009A 2010E 2011E EPS -$3.64 -$0.32 $0.67 $1.25P/E 14.1x 7.6x CFPS $0.30 $0.30 $1.23 $1.82P/CFPS 7.7x 5.2x Rev. ($mm) $1,557 $1,138 $1,596 $1,863 EV ($mm) $572 $483 $814 $761 EBITDA ($mm) $83 $40 $142 $211 EV/EBITDA 6.9x 12.1x 5.7x 3.6x Quarterly EPS Q1 Q2 Q3 Q4 2008A $0.14 $0.16 $0.06 -$3.99 2009A -$0.16 -$0.12 $0.01 -$0.06 2010E $0.17 $0.17 $0.16 $0.17 Dividend $0.00 Yield 0.0% Book Value $5.99 Price/Book 1.6x Shares O/S (mm) 83.9 Mkt . Cap ($mm) $793 Float O/S (mm) 72.9 Float Cap ($mm) $689 Wkly Vol (000s) 708 Wkly $ Vol (mm) $4.4 Net Debt ($mm) $64.6 Next Rep. Date 06-May (E)

Notes: All values in C$ Major Shareholders: Natale Rea 11.2% First Call Mean Estimates: MARTINREA INTERNATIONAL INC (C$) 2009E: -$0.12; 2010E: $0.66; 2011E: $1.01

Changes Annual EPS Annual CFPS Quarterly EPS Target 2010E $0.87 to $0.67 2010E $1.60 to $1.23 Q1/10E $0.19 to $0.17 $12.00 to $11.00 2011E $1.50 to $1.25 2011E $2.31 to $1.82 Q2/10E $0.21 to $0.17 Q3/10E $0.23 to $0.16 Q4/10E $0.24 to $0.17

This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 4 to 7.

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Orleans Energy (OEX-TSX) Stock Rating: OutperformIndustry Rating: Market Perform

March 25, 2010 Research Comment Calgary, Alberta

Mark Leggett, CFA (403) 515-1508 Mark.Leggett@bmo.com Assoc: Jason Chang

Q4/09 Results in Line

Event Orleans reported Q4/09 CFPS of $0.09 and production of 3,824 boe/d, in line

with our estimates of $0.08 and 3,893 boe/d, respectively. The company

previously disclosed proved plus probable (2P) reserves increased 11% to 19.9

MMboe. 2P FD&A costs (including future capital) were $19.56/boe, which

included approximately $18 million of capital incurred for the construction of

the Kaybob K3 pipeline. For 2010, Orleans reiterated a capital budget of $41

million consisting of a drilling program of roughly 11 (9.6 net) wells including

six (4.8 net) Montney well at Kaybob and three net horizontal locations at

Waskahigan. Based on the capital program, the company expects to achieve

average production of 4,100 to 4,200 boe/d. Orleans announced a new $60

million credit facility agreement effective April 6, 2010.

Impact Neutral.

Forecasts Reflecting adjustments to our operating assumptions based on Q4/09 results, our

CFPS estimates have been slightly increased to $0.38 in 2010 and $0.48 in

2011. Our financial estimates are based on production forecasts of 4,148 boe/d

in 2010 and 4,497 boe/d in 2011, which remain unchanged.

Valuation Orleans currently trades at 2010E valuation multiples of 6.3x P/CFPS and 7.8x

EV/EBITDA. Our revised target price is supported by our updated sum-of-parts

valuation of $4.96 (AECO $5.75/Mcf).

Recommendation We continue to rate Orleans shares Outperform. The company is well

capitalized for 2010 (33% undrawn on projected 2010E net debt) and has

hedged approximately 32% of its natural gas production at $5.27/Mcf in 2010.

Near-term catalysts continue to be exploration results at Waskahigan.

Price (24-Mar) $2.40 52-Week High $3.15 Target Price $3.50 52-Week Low $1.75

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200OEX Relative to S&P/TSX Comp

Last Data Point: March 23, 2010

(FY-Dec.) 2008 A 2009A 2010E 2011E CFPS $0.94 $0.27 $0.38 $0.48P/CFPS 6.3x 5.0x EPS -$0.07 -$0.32 -$0.13 -$0.08P/E na na CF/boe $27.41 $10.54 $16.26 $18.97 EV/EBITDA 3.8x 13.5x 7.8x 6.6x ROCE -2.0% -9.0% -4.0% -2.0% D/CF 1.3x 1.7x 1.6x 1.7x Quarterly CFPS Q1 Q2 Q3 Q4 2008A $0.24 $0.29 $0.24 $0.17 2009A $0.08 $0.04 $0.05 $0.09 2010E $0.11 $0.08 $0.09 $0.10 Dividend $0.00 Yield 0.0% Book Value $2.84 Price/Book 0.8x Shares O/S (mm) 65.2 Mkt . Cap ($mm) $156 Float O/S (mm) 53.8 Float Cap ($mm) $129 Wkly Vol (000s) 1,102 Wkly $ Vol (mm) $2.6 Net Debt ($mm) $25.2 Next Rep. Date May (E)

Notes: All values in C$ Major Shareholders: Widely Held First Call Mean Estimates: ORLEANS ENERGY LTD (C$) 2010E: $0.46; 2011E: $0.54

Changes Annual EPS Annual CFPS Quarterly CFPS 2010E -$0.14 to -$0.13 2010E $0.36 to $0.38 Q1/10E $0.10 to $0.11 2011E -$0.09 to -$0.08 2011E $0.47 to $0.48 Q2/10E $0.07 to $0.08

This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 2 to 4.

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Stoneham Drilling Trust (SDG.UN-TSX) Stock Rating: Not RatedIndustry Rating: Market Perform

March 24, 2010 Research Comment Calgary, Alberta

Michael Mazar, CFA (403) 515-1538 Michael.Mazar@bmo.com Assoc: Jason A. Zhang

Coverage Discontinued

Event We are discontinuing research coverage of Stoneham Drilling as a result of the

trust's limited market cap and the reallocation of research analyst resources. Our

final rating was Underperform. Investors should no longer rely on BMO Capital

Markets Research for an investment recommendation on Stoneham Drilling.

Price (23-Mar) $5.26 52-Week High $5.32 Target Price na 52-Week Low $1.20

0

5

10

15

20

25

30

0.5

1.0

1.5

2.0

2.5

Stoneham Drilling Trust (SDG.UN)Price: High,Low,Close Earnings/Share

0

1

2

0

1

2Volume (mln)

2005 2006 2007 2008 20090

100

200

0

100

200SDG.UN Relative to S&P/TSX Comp

Last Data Point: March 23, 2010

(FY-Dec.) 2008A 2009E 2010E 2011E CDPU $2.80 na na na P/CDPU na na na CFPU $3.37 na na na P/CFPU na na na CF Payout % 69% na na na EV ($mm) $84 na na na EBITDA ($mm) $31.4 na na na EV/EBITDA 2.7x na na na Quarterly CDPU Q1 Q2 Q3 Q4 2008A $0.92 -$0.30 $0.79 $1.39 2009E $0.72a -$0.09a -$0.11a na 2010E na na na na Dividend $0.00 Yield 0.0% Book Value $12.16 Price/Book 0.4x Units O/S (mm) 8.0 Mkt . Cap ($mm) $42 Float O/S (mm) 5.3 Float Cap ($mm) $28 Wkly Vol (000s) 97 Wkly $ Vol (mm) $0.3 Net Debt ($mm) $53.9 Next Rep. Date May (E)

Notes: All values in C$

This report was prepared by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 2 to 3.

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Commodity Comment

March 24, 2010 Research Comment Bart Melek Global Commodity Strategist (416) 359-4906 Bart.Melek@bmo.com Assoc: Lucas Litwiniuk

Gold Correction Represents Buying Opportunity —Skyrocketing U.S. Federal Debt the Catalyst

The recent gold correction represents a longer-term buying opportunity for the metal and the associated miners — skyrocketing U.S. federal debt is the catalyst. Gold fell to a one-month low of US$1.090/oz today as a stronger U.S. dollar reduced the impetus to buy the precious metal as a hedge (gold typically moves inversely to the U.S. currency). The greenback rallied to a 10-month high against the euro, after the French and Germans said any package to bailout Greece would likely involve help from the IMF. The news of any IMF involvement is undermining confidence in the European Union and has investors questioning the long-term viability of the euro. The euro also came under pressure in reaction to Fitch Ratings lowering Portugal’s credit rating.

While the U.S. dollar could rally and take gold down further in the short run, due to current troubles in Europe, it is unlikely that the U.S. currency will strengthen and gold decline on a consistent basis over the long run. BMO expects gold to be firm over the next two years, with considerable upside risk owing to the massive increases in the U.S. budget deficit. The growing public obligations imply a risk of monetization, which could result in a lower dollar and higher inflation — catalysts for gold investment demand.

The U.S. gross federal debt currently stands at around US$12 trillion (83% of GDP) and is projected by the Office of Management and Budget to reach nearly US$20 trillion by 2015 (103% of GDP). Given the lack of any concrete policies on the tax revenue side of the fiscal equation to help balance the budget in the U.S. Congress, growing expenditures and the relatively lofty official GDP growth assumptions, the U.S. debt is likely to be even higher than forecasted by the government. Based on the relationship between the gold price and the federal debt over the last three decades or so, this could be very good news for gold and gold-related assets broadly. In addition, the sorry financial situation of U.S. states, such as California, could mean that a Greek-like debt crisis could engulf America as well.

Bottom Line: The current gold and gold equities correction likely represents a buying opportunity for the long term. High leverage gold names are likely to benefit most from future high gold prices. BMO’s gold equity team suggests Harmony Gold (HMY-NYSE, HAR-JSE), Golden Star Resources (GSS-AMEX, GSC-TSX), Barrick Gold ( ABX-NYSE, TSX), Centerra Gold (CG-TSX) and Detour Gold (DGC-TSX), to name just a few, as a way to capitalize on gold’s upside.

SUSTAINED DOLLAR RALLY UNLIKELYSKYROCKETING U.S. FEDERAL DEBT SHINES ON GOLD

70

80

90

100

110

120

130

140

1982 1986 1990 1994 1998 2002 2006 2010 2014

$0

$3,000

$6,000

$9,000

$12,000

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$18,000

$21,000B

illi

on

s

$0

$275

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$825

$1,100

$1,375

$1,650

$1,925

$2,200

1982 1986 1990 1994 1998 2002 2006 2010 2014

$0

$2,750

$5,500

$8,250

$11,000

$13,750

$16,500

$19,250

$22,000

Billio

ns

Average Annual Gold Price Gross U.S. Federal Debt

R² (adjusted): 0.93

Trade Weighted USD Gross U.S. Federal Debt

r: -0.70

Back to Index

Relative Strength Filter March 25, 2010 Research Comment Quantitative/Technical Research Mark Steele (416) 359-4641 mark.steele@bmo.com Assoc: Tiberiu Stoichita

Drillers

Drillers have deteriorated to an avoid, ranking 8th decile. Th ey have undergon e a stead y slide fr om a 3rd decile spot a month ago – Figure 1.

The U.S. group shows the relative strength top ping pattern and the new underper forming channel – Figure 2.

We highlight d rillers with a m arket cap italization gre ater th an US$500mm in Figure 3, the entire list can be found here.

o There is an equ al blend of con sistent underper formers (short candid ates), and breakd owns of outperforming trends (stop losses for longs).

Figure 1: Oil & Gas Drilling Group Decile Rating Figure 2: U.S. Oil & Gas Drilling vs. S&P 1500

Figure 3: Oil & Gas Drillers

Source: BMO Capital Markets, Bloomberg, Thomson, Markit

This report was prepared in part by an analyst(s) employed by BMO Nesbitt Burns Inc., and who is (are) not registered as a research analyst(s) under FINRA rules. For disclosure statements, including the Analyst's Certification, please refer to pages 8 to 9.

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Market Elements March 24, 2010 Research Comment Quantitative/Technical Research Mark Steele (416) 359-4641 mark.steele@bmo.com Assoc: Tiberiu Stoichita

Equity markets ended mixed and little changed.

U.S. treasuries led a sell-off in most global bond markets; demand for the U.S. 5-year auction was weak; U.S. 10-yr swap spreads went further into the red – see BMO Chart

Currency leveraged plays led a broad based sell-off in commodities.

The Euro broke sharply to the downside on pessimism on the Greek debt front ahead of Thursday’s EU meeting; the Yen, whose moves are typically coupled with the USD (rising on risk aversion, falling on risk appetite), fell a whopping 2% versus the USD at the low of the day – it’s all RATE DIFFERENTIALS – BMO Chart

Levels* Currencies (USD per) Commodities Government 10- Yr Benchmark Equity Indices & Sentiment

Symbol H/L Level %Chg Symbol H/L Level %Chg Symbol H/L Level Chg Symbol H/L Level %ChgDXY 81.92 1.3% DJ UBS 130.59 -0.9% U.S. 3.84 0.15 S&P 1200 1,333 -0.9%EUR 1.3317 -1.3% WTI Oil 80.39 -1.9% Canada 3.54 0.08 S&P 500 1,168 -0.5%CHF 0.9315 -1.5% NMX Gas 4.09 -1.0% Germany 3.08 0.02 S&P/TSX 11,963 -0.7%GBP 1.4879 -1.1% AECO Gas 3.63 0.0% France 3.41 0.04 Euro STOXX 2,904 -0.2%JPYx10 0.1084 -2.0% Gold 1,085.6 -1.8% Switzerland 1.91 0.00 FTSE 100 H 5,678 0.1%CAD 0.9759 -0.8% Silver 16.60 -2.6% Italy 3.92 0.01 Hang Seng 21,009 0.1%AUD 0.9083 -1.1% Platinum 1,579.3 -1.9% Spain 3.83 0.01 Topix 952 0.5%NZD 0.7025 -0.7% Palladium 446.00 -3.7% Greece 6.36 0.06 S&P/ASX 4,892 0.3%BRL 0.5555 -1.3% CMX Cu 333.65 -1.0% U.K. 3.98 0.06 Shang/Shen 3,277 0.0%MXNx10 0.7948 -0.8% LME Al 3m 1.01 -1.6% Australia 5.69 0.03 Sensex30 17,451 0.0%ZAR 0.1354 -0.8% LME Ni 3m 10.09 -1.1% Hong Kong 2.67 0.01 CDX IG 5Yr 88.22 2.7%KRWx10 0.8770 -0.3% LME Zn 3m 1.00 -1.3% India 7.87 0.00 TRIN 0.70 -9%SGD 0.7113 -0.4% Lumber 282.50 1.9% Japan 1.35 -0.01 VIX 17.55 7.3%

Moves Currencies (spot) Commodities Government 10- Yr Benchmarks Equity Indices

2.5% 2.0% 1.5% 1.0% 0.5% 0.0%

JPY

CHF

BRL

EUR

AUD

GBP

CAD

MXN

ZAR

NZD

SGD

KRW

4.0% 2.0% 0.0% 2.0% 4.0%

Palladium

Silver

Platinum

WTI Oil

Gold

LME Al 3m

LME Zn 3m

LME Ni 3m

CMX Cu

NMX Gas

DJ UBS

AECO Gas

Lumber

-0.050.000.050.100.150.20

Japan

India

Sw itzerland

Spain

Italy

Hong Kong

Germany

Australia

France

Greece

U.K.

Canada

U.S.

1.0% 0.5% 0.0% 0.5% 1.0%

S&P 1200

S&P/TSX

S&P 500

Euro STOXX

Sensex30

Shang/Shen

FTSE 100

Hang Seng

S&P/ASX

Topix

Sectors S&P Global 1200 S&P Europe 350 S&P 500 S&P/TSX Composite

1.5% 1.0% 0.5% 0.0%

Telecom

Utilities

Cons Stap

Materials

Energy

Industrials

Hlth Care

Cons Disc

Financials

Info Tech

1.5% 1.0% 0.5% 0.0% 0.5%

Telecom

Cons Stap

Utilities

Hlth Care

Energy

Info Tech

Industrials

Cons Disc

Materials

Financials

0.4% 0.2% 0.0% 0.2% 0.4% 0.6% 0.8%

Telecom

Utilities

Industrials

Cons Stap

Financials

Energy

Materials

Cons Disc

Info Tech

Hlth Care

3.0% 2.0% 1.0% 0.0% 1.0% 2.0%

Materials

Info Tech

Telecom

Energy

Cons Disc

Utilities

Cons Stap

Industrials

Financials

Hlth Care

Source for all data and graphics in this publication: BMO Capital Markets, Bloomberg, Thomson * H/L = at a new closing 52- wk High/Low; / = within 10% of the 52- week High/Low; Colour codes are inverted for bond and sentiment indications

Market Elements

Page 2 March 24, 2010 (Back to Index)

Daily Charts 3- Month View with 50- and 26- Day Moving Averages

Euro Watch – Euro down = European Manufacturing Up - FT; Fitch Downgrades Portugal’s Debt (yet debt shows little, if any, reaction to the downgrade) - WSJ, FT

On the U.S. 10-year swap spread, which turned negative on Tuesday, and moved further so on Wednesday – lots of opinion, little consensus – Bloomberg, Reuters, WSJ, Alphaville, GEA – see BMO Chart

Currencies Commodities Bonds Equities

Market Elements

Page 3 March 24, 2010 (Back to Index)

Intra Day Charts 2- Day Tick View

U.S. bonds suffer on the U.S. durable goods report, and on a weak debt auction.

Euro – the commodity driver, with huge headline risk.

Currencies Commoditie s Bonds Equities

Market Elements

Page 4 March 24, 2010 (Back to Index)

Daily Sector Charts 3- Month View with 50- and 26- Day Moving Averages

New Highs: U.S. – Financials, Canada – Health Care, Europe – Materials, Discretionary, Health Care, Technology.

S&P 500

S&P/TSX Composite

S&P Europe 350

Market Elements

Page 5 March 24, 2010 (Back to Index)

Market Movers – Largest Daily Percentage Moves Global – Nintendo (7974 JP) said it would begin selling a 3-D version of its popular handheld console within a year - AP, DJ, NYT

U.S. – Jabil Circuit (JBL) fell on results - AP

Canada – Big U.S. dollar gains = big gold share losses.

S&P Global 1200 ex U.S. & Canada S&P 500 S&P/TSX CompositeName Symbol % Chg Name Symbol % Chg Name Symbol % ChgSECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg

Energy Oil Search Ltd OSH AU 1.0% Massey Energy Co MEE 3.7% Crew Energy Inc CR 1.9%Technip SA TEC FP 0.9% Tesoro Corp/Texas TSO 3.6% Baytex Energy Trust BTE-U 1.9%

Inpex Corp 1605 JP 0.9% Valero Energy Corp VLO 1.9% Nexen Inc NXY 1.1%

Repsol YPF SA REP SM -1.5% Halliburton Co HAL -1.6% Pason Systems Inc PSI -2.8%BG Group PLC BG/ LN -1.5% EOG Resources Inc EOG -1.7% Trinidad Drilling Ltd TDG -2.8%

Nippon Oil Corp 5001 JP -1.7% Helmerich & Payne Inc HP -1.8% Ivanhoe Energy Inc IE -3.9%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER ChgMaterials Umicore UMI BB 3.7% Cliffs Natural Resources Inc CLF 2.9% CCL Industries Inc CCL/B 2.5%

UPM-Kymmene OYJ UPM1V FH 2.6% Titanium Metals Corp TIE 2.6% First Quantum Minerals Ltd FM 1.5%

Rio Tinto Ltd RIO AU 2.0% Dow Chemical Co/The DOW 1.3% Potash Corp of Saskatchewan In POT 1.2%Cia de Minas Buenaventura SA BVN US -3.7% Sealed Air Corp SEE -1.2% Novagold Resources Inc NG -5.4%Fibria Celulose SA FBR US -4.0% Freeport-McMoRan Copper & Gold FCX -1.6% IAMGOLD Corp IMG -5.7%Cemex SAB de CV CEMEXCPO MM -4.2% Newmont Mining Corp NEM -3.4% Jaguar Mining Inc JAG -9.5%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg

Industrials NSK Ltd 6471 JP 4.8% Jacobs Engineering Group Inc JEC 3.9% IESI-BFC Ltd BIN 1.5%

Furukawa Electric Co Ltd 5801 JP 3.5% Fluor Corp FLR 2.0% Toromont Industries Ltd TIH 1.2%Kubota Corp 6326 JP 3.3% Honeywell International Inc HON 0.7% CAE Inc CAE 1.0%

Cie de St-Gobain SGO FP -2.3% First Solar Inc FSLR -2.3% Transat AT Inc TRZ/B -1.3%

NGK Insulators Ltd 5333 JP -2.6% Deere & Co DE -2.4% Bombardier Inc BBD/B -1.4%SGS SA SGSN VX -4.9% Stericycle Inc SRCL -3.0% Jazz Air Income Fund JAZ-U -1.5%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg

Cons Disc Mediaset SpA MS IM 5.5% Lennar Corp LEN 3.7% Tim Hortons Inc THI 0.3%

ITV PLC ITV LN 5.2% Darden Restaurants Inc DRI 2.3% Linamar Corp LNR 0.1%

Societe Television Francaise 1 TFI FP 5.0% Time Warner Cable Inc TWC 1.9% Sears Canada Inc SCC -0.1%

Intercontinental Hotels Group IHG LN -2.0% RadioShack Corp RSH -2.6% Gildan Activewear Inc GIL -1.0%Esprit Holdings Ltd 330 HK -2.1% AutoNation Inc AN -2.7% Astral Media Inc ACM/A -1.1%

Sony Corp 6758 JP -2.7% Interpublic Group of Cos Inc IPG -3.0% Thomson Reuters Corp TRI -1.8%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER ChgCons Stap Unicharm Corp 8113 JP 3.0% Tyson Foods Inc TSN 0.8% Metro Inc MRU/A 1.4%

Seven & I Holdings Co Ltd 3382 JP 2.7% HJ Heinz Co HNZ 0.7% Maple Leaf Foods Inc MFI 0.5%

Grupo Modelo SAB de CV GMODELOC MM 2.5% Dean Foods Co DF 0.5% Cott Corp BCB 0.3%Centros Comerciales Sudamerica CENCOSUD CI -2.0% Estee Lauder Cos Inc/The EL -2.5% Saputo Inc SAP -0.6%

Asahi Breweries Ltd 2502 JP -2.5% Whole Foods Market Inc WFMI -2.5% Jean Coutu Group PJC Inc/The PJC/A -0.8%

Yakult Honsha Co Ltd 2267 JP -3.9% Archer-Daniels-Midland Co ADM -2.8% Shoppers Drug Mart Corp SC -0.9%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER ChgHealth Care Novo Nordisk A/S NOVOB DC 3.2% Stryker Corp SYK 1.7% SXC Health Solutions Corp SXC 2.2%

Sonic Healthcare Ltd SHL AU 2.2% St Jude Medical Inc STJ 0.6% Biovail Corp BVF 2.2%

Shire PLC SHP LN 2.1% Pfizer Inc PFE 0.4% CML Healthcare Income Fund CLC-U 0.9%

Merck KGAA MRK GR -0.8% Coventry Health Care Inc CVH -2.5% MDS Inc MDS 0.2%

Shionogi & Co Ltd 4507 JP -1.2% Tenet Healthcare Corp THC -5.2%Eisai Co Ltd 4523 JP -2.0% Genzyme Corp GENZ -6.4%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg

Financials Deutsche Boerse AG DB1 GR 4.3% Genworth Financial Inc GNW 4.2% Boardwalk Real Estate Investme BEI-U 2.4%

BOC Hong Kong Holdings Ltd 2388 HK 2.6% Host Hotels & Resorts Inc HST 3.2% GMP Capital Inc GMP 1.7%

Commerzbank AG CBK GR 2.1% KeyCorp KEY 2.7% Primaris Retail Real Estate In PMZ-U 1.6%Banco Santander SA SAN SM -2.5% E*Trade Financial Corp ETFC -1.9% Laurentian Bank of Canada LB -0.5%

Itau Unibanco Holding SA ITUB US -2.9% Bank of New York Mellon Corp/T BK -2.1% Fairfax Financial Holdings Ltd FFH -0.6%

Aviva PLC AV/ LN -4.4% CB Richard Ellis Group Inc CBG -2.2% RioCan Real Estate Investment REI-U -2.1%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER ChgTechnology Nintendo Co Ltd 7974 JP 8.7% Adobe Systems Inc ADBE 3.7% CGI Group Inc GIB/A 1.6%

Infineon Technologies AG IFX GR 4.9% Red Hat Inc RHT 1.8% MacDonald Dettwiler & Associat MDA -0.3%STMicroelectronics NV STM IM 4.4% Google Inc GOOG 1.5% Open Text Corp OTC -1.0%

Hirose Electric Co Ltd 6806 JP -1.6% Analog Devices Inc ADI -4.5% Research In Motion Ltd RIM -1.2%

Telefonaktiebolaget LM Ericsso ERICB SS -2.0% Xilinx Inc XLNX -5.5% Celestica Inc CLS -3.2%Asustek Computer Inc 2357 TT -2.0% Jabil Circuit Inc JBL -10.0%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg

Telecom Nippon Telegraph & Telephone C 9432 JP 0.8% Sprint Nextel Corp S 2.9% Bell Aliant Regional Communica BA-U 0.5%Vodafone Group PLC VOD LN 0.3% American Tower Corp AMT -0.2% BCE Inc BCE -0.1%

Chunghwa Telecom Co Ltd 2412 TT 0.0% CenturyTel Inc CTL -0.6% TELUS Corp T -0.6%

Cable & Wireless Communication CWC LN -1.4% Qwest Communications Internati Q -1.3% Manitoba Telecom Services Inc MBT -0.8%Telecom Italia SpA TIT IM -1.5% Verizon Communications Inc VZ -1.7% Rogers Communications Inc RCI/B -2.2%

Portugal Telecom SGPS SA PTC PL -1.8% MetroPCS Communications Inc PCS -1.8%SECURITY_NAME TICKER Chg SECURITY_NAME TICKER Chg SECURITY_NAME TICKER ChgUtilities Veolia Environnement VIE FP 1.1% Questar Corp STR 0.3% Atlantic Power Corp ATP 2.8%

Chubu Electric Power Co Inc 9502 JP 1.0% Constellation Energy Group Inc CEG 0.2% Brookfield Renewable Power Fun BRC-U 0.8%

Iberdrola Renovables SA IBR SM 0.9% Allegheny Energy Inc AYE -0.1% TransAlta Corp TA 0.5%Cia Paranaense de Energia ELP US -2.1% Exelon Corp EXC -1.7% Northland Power Income Fund NPI-U -0.9%

Centrais Eletricas Brasileiras EBR US -2.2% AES Corp/The AES -1.9% Fortis Inc/Canada FTS -0.9%

Korea Electric Power Corp 015760 KS -2.7% NRG Energy Inc NRG -1.9% Canadian Utilities Ltd CU -0.9%

Bold = move of more than 5%

Market Elements

Page 6 March 24, 2010 (Back to Index)

Canadian Market Movers

Euro weakness (dollar strength) took the wind out of dollar sensitive metals – mind the EUR, and the headline risk at the EU summit

Martinrea (MRE) gaps lower on results – Reuters, BMO

Energy Materials Industrials Consumer Discretionary Technology FinancialsSymbol H/L Last %Chg Symbol H/L Last %Chg Symbol H/L Last %Chg Symbol H/L Last %Chg Symbol H/L Last %Chg Symbol H/L Last %ChgPD-U 7.55 -1.8% MX 24.66 -1.7% BBD/B 5.79 -1.3% MG/A 62.71 -0.2% XIT 7.57 -0.6% XFN H 23.93 0.0%ESI 14.62 -1.3% POT 125.85 1.2% CAE H 9.77 1.0% LNR 18.66 0.1% OTC 47.45 -0.8% RY 59.95 -0.4%TDG 6.95 -2.7% AGU 72.55 0.0% RNO 6.25 0.8% MRE 8.75 -7.4% MN 3.78 1.3% TD 76.02 -0.1%SVY 7.08 -0.2% CCL/B 28.86 2.5% VIC-U 15.95 -0.9% WPT 17.13 2.2% CX 1.01 2.1% BNS H 51.32 0.0%TCW 13.01 -0.6% CAS 8.35 -0.9% WFI 27.82 1.1% BLD 2 .98 7.1% MMC 0.25 4.1% BMO 61.99 -0.4%SCL/A 28.16 -0.7% TCK/B 41.69 0.3% SNC 50.31 -1.1% AZD 0. 23 6.9% GIB/A 15.40 1.5% CM 77.06 -0.1%MTL 15.60 -0.5% IVN 16.61 -1.7% ARE 13.84 -0.0% ZNN 2.40 3.0% MTK 3.54 0.2% NA 62.73 0.2%CFW 22.45 -2.6% FM 90.20 1.5% GNV-U 28.00 1.3% DII/B 32.27 -0.4% CTY 18.15 -0.5% CWB 24.22 0.2%PSI 11.50 -2.7% IMN 56.35 -1.5% BDT-U 32.25 -0.6% GIL 26.62 -0.9% MDA 37.94 -0.3% LB 43.92 -0.5%FES 12.58 -0.9% LUN 4.95 -2.1% KHD US 14.40 0.7% GC 8.10 -1.6% CSU H 42.50 0.5% MIC 26.96 1.1%TESO US 11.30 -1.9% EQN 3.61 -2.6% CUQ 19.79 -2.8% THI 33.46 0.2% DSG 6.52 1.0% HCG 43.38 0.9%SU 31.20 -0.6% S 8.71 -1.2% SDC 14.28 -0.8% MTY 9.50 -1.1% CMG 16.81 0.9% ETC 24.15 0.0%IMO 38.57 -0.3% HBM 13.28 -3.7% CSIQ US 22.02 -1.9% BPF-U 11.88 -0.1% ESL 7.70 -1.2% FN-U H 21.80 1.5%HSE 27.40 -0.7% TCM 13.87 0.4% TIH 30.34 1.2% PZA-U 7.37 -0.9% ENA 0.59 -1.6% MKP 12.29 2.4%CVE 25.33 -1.0% QUA 16.36 -3.6% NFI-U 11.08 0.1% AW-U 16.18 -0.1% MKX 11.57 -1.5% FC-U 11.12 -0.8%IOC US 67.95 -1.0% FNX 14.36 -5.1% AFN 35.98 -0.0% KEG-U 12.09 0.3% RKN 1.46 -1.3% HEQ 7.15 -0.5%PVE-U 7.84 -0.3% WTN H 5.83 4.4% ATA 6.69 2.1% CWI-U 5.27 -0.3% TWT 3.48 3.8% DHF-U 17.60 1.2%CLL 1.32 -0.7% NDM 9.13 -2.5% ARF-U 21.40 0.5% AER 10.60 -0.9% ABT 5.80 -0.8% OCX 28.09 1.2%CNQ 72.33 -0.4% TKO 5.01 0.6% WJX-U 26.60 -0.5% MDZ/A 11.08 0.0% BWC 10.10 -3.1% X 30.00 -0.1%ECA 30.82 -2.1% ORA 3.94 0.2% GLV/A 9.36 4.0% ACM/A 34.85 -1.1% AXX 1.73 2.9% QC 1.31 0.7%TLM 17.14 -0.3% MDI 25.10 -1.0% FTT 17.82 0.5% CJR/B 19.51 -0.4% RIM 75.85 -1.1% CSF 14.89 0.8%COS-U 28.20 -2.2% GCE H 8.42 3.4% SPB 14.24 -0.9% TVA/B 15.00 -2.8% AAH 31.96 -0.5% IGM 44.38 0.8%NXY 24.44 1.0% CTQ 7.98 1.2% RUS H 19.48 0.9% SJR/B 20.03 -0.3% DWI 10.22 -5.0% CIX 21.09 -0.4%PWT-U 21.75 0.1% AVM 3.80 -4.0% RCH 22.86 -0.4% CCA 41.60 -0.1% WIN 2.82 -1.7% AGF/B H 18.77 1.0%CPG 38.81 -0.2% ABX 38.15 -3.2% CWX 4.73 1.0% CGO 33.00 -0.7% SW 8.90 0.3% DC/A 13.20 -0.0%UPL US 44.86 0.4% G 38.23 -3.3% CVL 13.83 -0.1% CGX-U 19.43 -0.1% CDV 3.12 -0.6% SII 4.29 -1.8%AET-U 21.40 -1.5% K 17.34 -4.2% TCL/A 13.60 -1.0% IMX H 16.95 0.5% RCM 19.55 1.0% U 5.92 0.6%PBG 54.38 -0.8% AEM 56.77 -3.6% BIN 18.08 1.4% LGF US 6.25 4.3% SVC 1.89 -6.4% GS 21.00 -0.0%NKO 101.04 0.2% YRI 10.06 -3.5% NAL 8.65 -0.6% FMN 1.69 4.9% VCM 6.65 -3.6% PNP 1.73 -1.7%PBN L 26.25 -0.9% ELD 12.31 -4.2% MLX H 12.80 0.5% TRI 36.82 -1.8% EXF 6.07 -0.3% GCG/A 8.08 0.0%PRE 19.49 -0.9% IMG 13.80 -5.6% RBA US 21.57 -1.4% YLO-U 6.19 -0.1% TZT 1.65 -0.6% DW 14.40 2.9%ERF-U 23.81 -0.7% RBI 19.39 -4.4% BDI 19.29 -3.0% QBR/B 33.80 -0.5% WEW 0.59 1.7% GMP 14.01 1.7%BTE-U H 36.49 1.8% FNV 25.54 -3.8% GW 11.31 -0.1% TS/B H 10.00 3.6% ET 13.70 -0.3% CF 11.20 0.6%PGF-U 11.63 1.0% CG 12.65 -4.3% MSI-U 10.65 -0.7% GVC H 2.30 9.5% PUR 4.50 -3.2% WES 3.29 -2.9%BNP-U 23.79 -1.6% OSK 8.49 0.1% STN 25.80 -0.6% UNS 30.04 -0.1% CTW/S 2.06 0.0% MFC 20.00 0.5%PMG 31.93 -0.8% IGT 109.02 -0.9% IBG-U 14.16 0.4% SCC 28.73 -0.0% MT 4.62 -0.4% GWO H 28.33 0.0%VET-U 35.15 -0.1% NGD 4.37 -3.9% WJA 13.75 0.0% CTC/A 54.85 -0.2% VNP 5.23 -2.0% PWF H 33.19 0.5%PRQ 11.57 -2.2% AGI 13.65 -2.5% TRZ/B 12.50 -1.2% DOL 21.77 -1.0% DSA 8.25 0.6% SLF 32.44 1.0%DAY-U 10.98 -1.9% GBU 4.17 -2.5% JAZ-U 4.47 -1.5% RET/A 16.18 -0.4% CLS 11.05 -3.1% POW 30.55 0.5%NAE-U 13.21 -1.1% GAM 8.34 -5.0% AC/B H 2.01 6.3% CTU/A 13.55 5.0% SO 9.95 0.3% IAG 34.91 0.8%PEY-U 13.24 -0.6% SMF H 5.44 1.1% CNR 60.17 0.8% GLN 15.00 -0.3% MSD 23.20 -0.8% FFH 376.05 -0.5%BNK 9.32 -1.5% DGC 18.47 -1.4% CP 54.66 -0.6% RON 15.83 -0.7% GND 6.20 0.6% IFC 43.00 0.4%POU 15.95 -0.7% NG 7.49 -5.4% TFI 9.90 0.1% FGL 14.24 -0.2% ZL 1.85 -3.1% XRE 12.20 0.6%NVA 12.10 -1.5% XGD 19.37 -3.1% STB 5.11 -0.3% IDG 17.50 -2.1% HR-U 16.54 0.8%

AAV 7.30 -0.2% EGU 6.31 -3.2% CSS H 9.00 0.8% LNF 12.24 0.3% Utilities REF-U 27.70 1.2%UTS 2.57 -1.9% LSG 2.66 -3.9% WTE-U 16.58 -0.5% GBT/A 36.50 0.6% Symbol H/L Last %Chg CUF-U 19.35 0.3%

BIR 8.65 -1.2% RMX 4.00 -4.7% Health Care Consumer Staples FTS 28.76 -0.8% CRR-U H 11.70 1.3%CR H 17.46 1.9% SGR 3.23 -2.4% Symbol H/L Last %Chg Symbol H/L Last %Chg EMA 24.54 0.0% AP-U 20.33 1.1%TNP 3.49 6.7% JAG 10. 09 -9.5% IM 6.70 -0.7% SC 44.39 -0.8% GZM-U 16.49 0.7% D-U 25.98 0.5%IE 3.42 -3.9% GSC 3.80 -0.7% EKO 1. 32 -7.0% PJC/A 9.82 -0.8% CU 47.86 -0.9% WRK-U 15.08 0.5%FRU-U 17.17 -0.8% NGX 3.04 -4.7% FMD-U 9.42 0.7% GCL 12.48 1.2% ACO/X 50.57 -0.4% BEI-U H 41.50 2.4%CLT 19.50 -2.6% SEA 22.83 4.0% CLC-U 12.86 0.8% L 37.60 0.0% JE-U 14.16 -0.7% CAR-U 14.43 1.2%QEC 4.12 -2.3% VEN 9.27 -2.2% DR-U 10.88 -0.6% WN 69.90 -0.4% TA 23.03 0.5% NPR-U H 24.50 1.6%LEG 12.65 0.3% R 1.92 -4.0% SXC H 69.25 2.2% MRU/A 42.26 1.3% BRC-U 21.31 0.8% REI-U 18.99 -2.1%TET 8.25 -0.8% ARZ 4.79 -1.8% CNJ 4.50 0.2% ATD/B 18.11 -0.0% NPI-U 13.57 -0.8% CWT-U 21.52 0.8%PXX 2.58 -1.9% CRU 0.47 1.0% TH 5.09 -0.3% EMP/A 51.71 -0.1% CPA-U 17.97 -0.1% PMZ-U 17.48 1.6%BNE 36.30 -0.3% JIN 4.57 0.4% QLT H 5.46 2.6% NWF-U 18.20 -0.2% ATP 13.10 2.8% MRT-U 13.33 0.1%PMT-U 4.87 0.6% MFL 9.66 -1.9% BU 9.50 4.5% LIQ-U 17.15 1.1% CPX 22.63 -0.6% AX-U 11.70 0.0%GO 6.89 -1.0% XRC 6.84 -3.5% ONC 3.41 0.5% BR-U H 16.95 0.2% RPG 2.98 -0.9% CSH-U 7.53 1.4%CMF 7.63 -3.0% HRG 0. 69 -5.4% HBP 2. 40 -14.2% CDL/A 15.30 -0.4% AQN 4.67 0.4% EXE-U 10.61 0.5%OPC 1.85 -0.5% GBG 1.70 -3.4% RVX 5.83 0.5% BCB 7.69 0.2% BLX 10.41 0.1% INN-U 5.91 2.2%SEO L 10.51 -0.2% SLW 15.51 -3.4% NYMX US 3.74 0.0% VT 9.44 1.2% MXY 1.60 -2.4% BAM/A 25.66 0.3%KEY-U 26.47 0.1% PAA 23.01 -4.1% YM 1.16 -1.6% ABC 1.43 -2.7% IEF-U 12.23 0.3% FCR 22.00 -1.1%PKI-U 11.55 0.0% SSO 17.67 -2.6% TTH 2.65 -3.9% SAP 29.20 -0.6% MPT-U 7.24 0.5% MRC 43.00 0.0%TRP 37.14 -0.0% SVM 6.89 -3.7% MDG 0.55 -3.5% CBY 51.85 0.0% PCC 3.49 0.0% BPP 19.48 1.1%ENB 49.05 -0.5% ELR 1.37 -2.1% AEZ 0.87 3.5% MFI 10.27 0.4% BPT-U 4.49 1.8% PRK 5.47 0.0%

IPL-U 11.77 -0.1% HW 9.88 -2.5% BVF H 16.81 2.1% AGT 33.59 -1.1% Telecom Services BPO H 15.75 0.0%PIF-U 17.61 -0.9% PPN 1.40 -0.7% PLB H 23.65 1.7% RSI-U 4.91 0.0% Symbol H/L Last %Chg MIM/A 13.26 0.6%FCE-U 10.65 0.0% GNA 7.79 -0.8% COM 6.63 -1.3% BXI 1.92 1.0% PIX 1.11 1.8% KMP 8.28 0.6%ALA-U 18.53 -0.4% CLM 9.04 -0.9% DDS 1.49 0.0% PBH 14.25 0.0% BCE 30.63 -0.0% MEQ 10.35 -0.2%CCO 27.60 -1.6% LIF-U 51.36 -0.3% ANP 1.14 0.0% SOY 3.98 0.7% T 37.44 -0.5% MRD 11.60 0.4%SGQ 16.81 1.9% TRE 19.91 -3.7% NRI 0.24 0.0% HLF H 10.85 2.3% BA-U 25.92 0.5% GDC 3.83 -2.0%UUU 2.60 0.0% WFT H 38.96 0.6% MDS 8.75 0.2% AG-U 2.85 -4.0% MBT 31.28 -0.8% FSV 22.45 -0.2%DML 1.51 2.0% CFP 9.25 1.0% PTI 2.58 -0.3% ATB 17.09 -0.5% WRX 0.87 -2.2% AIF-U 13.92 4.5%XEG 17.68 -0.6% NBD 16.50 -0.0% GLG 7.50 2.8% RCI/B 34.57 -2.1% BRE-U 13.15 -0.6%

H/L = at a new closing 52- wk High/Low; / = within 10% of the 52- wk High/Low; Blue = S&P/TSX 60 member, Italics = ETF, Bold = move of more than 5%

Market Elements

Page 7 March 24, 2010 (Back to Index)

Earnings Expected Next Session

Company Ticker Country Sector Industry MktCap Period TimeWest Energy Ltd. WTL CN Canada Energy OG E&P 420 Q4BlackWatch Energy Services Corp BWT CN Canada Energy OG Equip 260 Q4Midway Energy Ltd MEL CN Canada Energy OG E&P 200 Q4Orleans Energy Ltd. OEX CN Canada Energy OG E&P 160 Q4Cnpc Hong Kong Ltd 135 HK Bermuda Energy OG E&P 6,460 YFranco-Nevada Corporation FNV CN Canada Materials Gold 2,980 Q4 Aft-mktGleichen Resources Ltd GRL CN Canada Materials Gold 350 Q1Augusta Resource Corp AZC CN Canada Materials DvrsMng 320 Q4Texas Industries Inc TXI US U. S. Materials CstrMat 1,060 Q3China Steel Corp 2002 TT Taiwan Materials Steel 13,390 YPeter Hambro Mining Plc POG LN U.K. Materials Gold 3,160 YAmeron International Corp AMN US U. S. Industrials BldPrdcts 630 Q1Empresas COPEC SA COPEC CI Chile Industrials IndCongl 18,990 YHochtief AG HOT GR Germany Industrials Cns&Eng 5,410 Y 07:00UTi Worldwide Inc UTIW US Virgin Islands British Industrials AirFrght 1,700 Q4 Bef-mktFlughafen Wien AG FLU AV Austria Industrials AirprtSrv 1,000 YCentrotherm Photovoltaics AG CTN GR Germany Industrials ElcCmpEq 990 YPV Crystalox Solar PLC PVCS LN U.K. Industrials ElcCmpEq 310 YCENTROTEC Sustainable AG CEV GR Germany Industrials BldPrdcts 260 YDanaos Corp DAC US Marshall Islands Industrials Marine 260 Q4Aleo Solar AG AS1 GR Germany Industrials ElcCmpEq 160 YTianjin Capital Environmental Protection Gr 1065 HK China Industrials EnvionServ 130 YBest Buy Co Inc BBY US U. S. CMR Disc CmpElRtl 17,350 Q4Lululemon Athletica Inc LLL CN U. S. CMR Disc Aprl&Gds 1,850 Q4Finish Line FINL US U. S. CMR Disc ApparlRtl 750 Q4 16:30China Automotive Systems Inc CAAS US U. S. CMR Disc AutoParts 570 Q4 Bef-mktWet Seal Inc WTSLA US U. S. CMR Disc ApparlRtl 460 Q4Fred's Inc FRED US U. S. CMR Disc GMrchStrs 450 Q4G-III Apparel Group Ltd GIII US U. S. CMR Disc Aprl&Gds 430 Q4 Bef-mktAmerican Apparel Inc APP US U. S. CMR Disc Aprl&Gds 250 Q4 Aft-mktConn's Inc CONN US U. S. CMR Disc CmpElRtl 140 Q4Hermes International RMS FP France CMR Disc Aprl&Gds 14,930 Y Bef-mktChina Resources Enterprise 291 HK Hong Kong CMR Disc Distrib 8,410 YKingfisher PLC KGF LN U.K. CMR Disc HmImpRtl 8,060 Y 07:00Next PLC NXT LN U.K. CMR Disc DeptStrs 5,860 YYue Yuen Industrial Holdings Ltd 551 HK Bermuda CMR Disc Footwear 5,580 Q1Cyrela Brazil Realty SA CYRE3 BZ Brazil CMR Disc HomeBld 5,140 Y Aft-mktSignet Group PLC SIG US Bermuda CMR Disc SpecStors 2,420 Q4 07:30Big Rock Brewery Inc Trust BR.UN CN Canada CMR Stap Brewers 100 Q4ConAgra Foods Inc CAG US U. S. CMR Stap PkgFdMt 11,650 Q3 07:30McCormick & Co Inc MKC US U. S. CMR Stap PkgFdMt 4,750 Q1 07:00Hengan International Group Co Ltd 1044 HK Cayman CMR Stap PersPrdct 8,520 YTheratechnologies Inc TH CN Canada Hlth Care Biotech 300 Q1Ind. and Com. Bank of China 1398 HK China Financials DiversBnk 61,210 YBanca Monte dei Paschi di Siena SpA BMPS IM Italy Financials DiversBnk 8,730 YChina Everbright Ltd 165 HK Hong Kong Financials OthrDivFS 4,010 YUnipol Gruppo Finanziario SpA UNI IM Italy Financials Multi-LnIns 1,810 YBank Leumi Le-Israel BM LUMI IT Israel Financials DiversBnk 660 YGottex Fund Management Holdings GFMN SW Guernsey Financials AsstMgmt 290 YIsrael Discount Bank Ltd DSCT IT Israel Financials DiversBnk 210 YGennum Corp GND CN Canada Info Tech Semi 210 Q1Oracle Corp ORCL US U. S. Info Tech SystmSwr 130,240 Q3 Aft-mktTIBCO Software Inc TIBX US U. S. Info Tech ApplicSwr 1,790 Q1 Aft-mktSYNNEX Corp SNX US U. S. Info Tech TechDist 1,080 Q1 Aft-mktSpectrum Control Inc SPEC US U. S. Info Tech ElecComp 150 Q1 16:00Accenture Ltd ACN US Ireland Info Tech ITConsult 26,810 Q2United Internet AG UTDI GR Germany Info Tech InetSftSrv 3,840 YKingsoft Corp Ltd 3888 HK Cayman Info Tech HmEntSwr 880 YSMART Modular Technologies WWH Inc SMOD US Cayman Info Tech EMS 410 Q2 Aft-mktTelecom Italia SpA TI US Italy Telecom IntegTelSrv 19,320 YWestern Wind Energy Corp WND CN Canada Utilities IPPTrad 70 Q4ACEA SpA ACE IM Italy Utilities MultiUtil 2,290 Y

Red = Canadian incorporated, Blue = U.S. incorporated, Highlighted = S&P Global 1200 Index member

Back to Index

Economic Research

March 25, 2010 Research Comment Dr. Sherry Cooper (800) 613-0205 Jennifer Lee (416) 359-4092 Benjamin Reitzes (416) 359-5628

A.M. Notes

Dr. Sherry Cooper, Chief Economist sherry.cooper@bmonb.com

416-359-4112

OVERSEAS – Benjamin Reitzes

The US$ index is lower this morning, following its largest daily gain in three and a half months yesterday. All the major currencies are stronger, though the euro continues to lag. The NZ$ is benefiting from solid Q4 real GDP growth (+0.8% as expected), which likely keeps the RBNZ on pace to start tightening around mid-year as previously stated. Meantime, the A$ is rallying after comments from RBA Assistant Governor Lowe that rates were being gradually moved to a “more normal level”. And, don’t forget about the C$, strengthening after yesterday’s comments from Carney which some took as a potential step towards a pre-July move. We’re sticking with our July call, as Carney also noted that the underlying inflation trend is less than 2% and that the recent rise was due partially to transitory effects. Commodities are a little stronger: oil is up 0.3% to $80.90, gold is $7 higher to $1094, base metals are mostly a tad stronger, and grains are mixed. A bunch of data came out of Europe but it was overshadowed by the ECB’s decision to extend its looser collateral rules. ECB President Trichet made the announcement overnight as EU leaders come together for a meeting, with the rules to remain in place through 2011. The looser rules ensure that Greek bonds are accepted as collateral (under normal rules, only A- rated or above, Greek bonds currently at BBB+ would not qualify). The haircuts for the various types of collateral are going to change though. This looks like the ECB’s contribution to supporting Greece. Meantime, German Chancellor Merkel said that IMF aid and bilateral loans for Greece are a last resort. On the data front, Euro area M3 fell 0.2% y/y in the three month to February. Flat money growth is just another sign that inflation pressures aren’t a significant concern at this point. Some negative data out of France, where consumer spending on durable goods fell 1.2% in February (consensus was looking for +0.4%). This follows a 2.5% drop in the prior month, as it is clear that a difficult labour market is weighing on French consumers. The bad news didn’t stop there, with Italy's retail sales declining 0.5% in January, much worse than expected. The only morsel of decent news was that German GfK consumer confidence held steady in April. Overall, nothing to change the view that while Europe is recovering, it’s going to be a slow and bumpy ride. The pound is rallying nicely after February retail sales surged 2.1%, handily beating expectations. The prior month was revised down, but that wasn’t enough to offset the strong gain. Excluding autos and fuel, sales were up 1.6%, solid and beating expectations as well. Improved weather likely aided sales following a cold January, which was also weakened as the VAT was boost in that month. Data out of the U.K. are showing some improvement, which, along with temporarily elevated inflation, should keep the Bank of England from easing further.

Sector Comment Economic Research

Page 2 March 25, 2010 (Back to Index)

Asian equity markets closed mixed, as the Nikkei rose 0.1%, the Hang Seng lost 1.1%, and China’s CSI 300 was down 1.5%. European markets are higher; DAX (+0.6%), CAC (+0.5%), FTSE (+0.3%). U.S. equity futures are up 0.3%. U.S. treasuries are stronger, with yields down 2-3 bps across the curve. Gilts and Bund 10-yrs yields are weaker, with yields up 4 and 3 bps, respectively. JGB 10-yr yields were up 2 bps.

Currency Market Current Change High Low

7:08 AMUS$ Index 81.64 -0.20 82.031 81.635C$ 1.0200 -0.0069 1.0268 1.0196C$ (US cents) 98.01 +0.62 97.39 98.08GBP 1.4977 +0.0108 1.4977 1.4859EUR 1.3363 +0.0048 1.3363 1.3290JPY 92.12 -0.18 92.33 91.77A$ 0.9127 +0.0053 0.9132 0.9067CNY 6.8271 +0.0004

Data Docket: Euro area: M3 Money Supply (Feb) -0.2% y/y, in the 3 months to February Germany: GfK Consumer Confidence (Apr) steady at 3.2, better than expected France: Consumer Spending (Feb) -1.2%, +1.6% y/y, much weaker than

expected Italy: Retail Sales (Jan) -0.5%, -2.6% y/y, well below consensus U.K.: Retail Sales ex autos/fuel (Feb) +1.6%, +5.4% y/y, well above

consensus, though prior month was revised down

NORTH AMERICA – Jennifer Lee

What’s on today’s docket? U.S. initial claims remain a market-moving indicator each Thursday, even on non-survey weeks. Today’s report (@8:30 am) will cover the number of first-time unemployment insurance claimants for the week of March 20th. A modest 7k decline is expected, which would be the fourth improvement in a row. Since bottoming in early January at around 440k, the trend in UI claims has not been very friendly. Although we are quite far from the highs of over 670k a year ago, the number of Americans receiving U.I. for the first time has been trending higher so far this year, a trend that needs to be reversed. Fed Chairman Bernanke will be testifying at the House Financial Services Committee Hearing at 10 am ET today. The subject is “Unwinding Emergency Federal Reserve Liquidity Programs and Implications for Economic Recovery”. If that sounds vaguely familiar, it is because this was the hearing that the Chairman was supposed to be at back in February, but was postponed due to the weather (i.e. the snowstorm). Recall that his written testimony was released, as scheduled, in which he laid out a credit-tightening blueprint….and one afternoon just over a week later, the Fed raised the discount rate. Today’s testimony may be the same as

Sector Comment Economic Research

Page 3 March 25, 2010 (Back to Index)

the one as February 10th, but the Q&A should have some more up-to-date tidbits on the Chairman’s thinking, although the overriding theme should not have changed too, too, much from last week’s FOMC press release. Also on the Fed and other officials’ speaking docket is Cleveland Fed President Sandra Pianalto (@ 9:10 am in Florida), and Treasury Secretary Timothy Geithner (appearing before the House Appropriations Subcommittee (@ 1:30 pm). Confidence is not an issue north of the 49th parallel: Both the Canadian economy and the U.S. economy grew about 5% annualized in the fourth quarter, and inflation doesn’t appear to be too much of an issue for both countries either. But that is about where the similarities end as far as recent economic data go. Housing markets and employment trends have been heading in different directions. And so has consumer sentiment. The Conference Board released Canadian consumer confidence for March and the index jumped 4.3 pts to 92.5 in the month. It doesn’t quite retrace February’s hefty decline but it made a pretty good effort and is the 2nd highest reading in two years. Compare and contrast that increase to the weaker readings coming out of the U.S. The University of Michigan’s survey, for example, showed sentiment down in February and March. Provy budget time: Yesterday, the Province of Saskatchewan released its latest budget. According to our Robert Kavcic, the Province “is projecting a $20 mln surplus in FY2010/11, a rare drop of black ink on the provincial fiscal landscape this year. While the Province will draw $194 mln from its reserve fund, it will also immediately begin to rein in spending growth—this differs from the other provinces that have so far chosen to postpone restraint for a year.” Today, Ontario takes its turn at the limelight. Before the actual unveiling of the numbers though, Finance Minister Duncan announced yesterday that the Province was in the red to the tune of $21.3 billion for FY09/10, the highest ever but below what was called for in the October statement. According to page A7 of today’s Globe and Mail, “Mr. Duncan delivered the good news on the eve of Thursday's provincial budget, which will show the McGuinty government shifting gears after successive increases in spending for health care, education and other social programs during its 6 1/2 years in office.” Backgrounders: “Quebec scraps energy deal with NB Power: After months of negotiation, Quebec and New Brunswick announced Wednesday they are scrapping a controversial energy deal that would have seen Hydro-Quebec get greater access to energy-hungry markets in the northeastern United States.” National Post, page FP5 “Social Security to See Payout Exceed Pay-In This Year: The bursting of the real estate bubble and the ensuing recession have hurt jobs, home prices and now Social Security. This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.” New York Times, page A1 “Bank Launches Big Plan to Cut Mortgage Debt: Under pressure by Massachusetts prosecutors, Bank of America Corp. said Wednesday it would reduce mortgage-loan balances as much as 30% for thousands of troubled borrowers, in what could presage a wider government effort to encourage banks to offer debt reduction to ease the mortgage crisis. The plan is one of the boldest moves yet to address the plight of millions of U.S. homeowners who are "under water," owing more on their homes than they're worth. It could make it easier for

Sector Comment Economic Research

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the Obama administration to move in a similar direction with its existing loan-modification program, although senior government officials and many bankers remain very wary of offering to cut loan balances as the main way of helping distressed borrowers.” Wall Street Journal, page A1

AM CHARTS

Canadian Government Stimulus: It Mattered Unemployment Lines Shorten U.S. Homebuilders Still In Recession U.S. Capital Spending To Continue Two Takes on The World’s Number Two Economy ON THE WEB: (Link to Chart)

BMO Capital Markets Disclosure Statements

Page 1 March 25, 2010 (Back to Index)

IMPORTANT DISCLOSURES Analyst's Certification As to each company covered in this report, each analyst hereby certifies that the views expressed accurately reflect the analyst’s personal views about the subject securities or issuers. Each analyst also certifies that no part of the analyst’s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Analysts who prepared this report are compensated based upon (among other factors) the overall profitability of BMO Capital Markets and their affiliates, which includes the overall profitability of investment banking services. Compensation for research is based on effectiveness in generating new ideas and in communication of ideas to clients, performance of recommendations, accuracy of earnings estimates, and service to clients. Company Specific Disclosures For Important Disclosures on the stocks discussed in this report, please go to http://researchglobal.bmocapitalmarkets.com/Company_Disclosure_Public.asp Distribution of Ratings (Dec. 31, 2009)

Rating Category

BMO Rating

BMOCM US Universe*

BMOCM USIB Clients**

BMOCM USIB Clients***

BMOCM Universe****

BMOCM IB Clients*****

First Call Universe

Buy Outperform 32.2% 12.3% 38.3% 36.1% 47.9% 50% Hold Market Perform 62.6% 10.2% 61.7% 56.9% 48.9% 43% Sell Underperform 5.3% 0% 0% 6.9% 3.2% 7%

* Reflects rating distribution of all companies covered by BMO Capital Markets Corp. equity research analysts. ** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking services

as percentage within ratings category. *** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking

services as percentage of Investment Banking clients. **** Reflects rating distribution of all companies covered by BMO Capital Markets equity research analysts. ***** Reflects rating distribution of all companies from which BMO Capital Markets has received compensation for Investment Banking services as

percentage of Investment Banking clients. Ratings and Sector Key We use the following ratings system definitions: OP = Outperform - Forecast to outperform the market; Mkt = Market Perform - Forecast to perform roughly in line with the market; Und = Underperform - Forecast to underperform the market; (S) = speculative investment; NR = No rating at this time; R = Restricted – Dissemination of research is currently restricted. Market performance is measured by a benchmark index such as the S&P/TSX Composite Index, S&P 500, Nasdaq Composite, as appropriate for each company. BMO Capital Markets eight Top 15 lists guide investors to our best ideas according to different objectives (Canadian large, small, growth, value, income, quantitative; and US large, US small) have replaced the Top Pick rating. Other Important Disclosures For Important Disclosures on the stocks discussed in this report, please go to http://researchglobal.bmocapitalmarkets.com/Company_Disclosure_Public.asp or write to Editorial Department, BMO Capital Markets, 3 Times Square, New York, NY 10036 or Editorial Department, BMO Capital Markets, 1 First Canadian Place, Toronto, Ontario, M5X 1H3. Prior BMO Capital Markets Ratings Systems http://researchglobal.bmocapitalmarkets.com/documents/2009/prior_rating_systems.pdf

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BMO Capital Markets Disclosure Statements

Page 2 March 25, 2010 (Back to Index)

General Disclaimer “BMO Capital Markets” is a trade name used by the BMO Investment Banking Group, which includes the wholesale arm of Bank of Montreal and its subsidiaries BMO Nesbitt Burns Inc. and BMO Nesbitt Burns Ltée./Ltd., BMO Capital Markets Ltd. in the U.K. and BMO Capital Markets Corp. in the U.S. BMO Nesbitt Burns Inc., BMO Capital Markets Ltd. and BMO Capital Markets Corp are affiliates. Bank of Montreal or its subsidiaries (“BMO Financial Group”) has lending arrangements with, or provide other remunerated services to, many issuers covered by BMO Capital Markets. The opinions, estimates and projections contained in this report are those of BMO Capital Markets as of the date of this report and are subject to change without notice. BMO Capital Markets endeavours to ensure that the contents have been compiled or derived from sources that we believe are reliable and contain information and opinions that are accurate and complete. However, BMO Capital Markets makes no representation or warranty, express or implied, in respect thereof, takes no responsibility for any errors and omissions contained herein and accepts no liability whatsoever for any loss arising from any use of, or reliance on, this report or its contents. Information may be available to BMO Capital Markets or its affiliates that is not reflected in this report. The information in this report is not intended to be used as the primary basis of investment decisions, and because of individual client objectives, should not be construed as advice designed to meet the particular investment needs of any investor. This material is for information purposes only and is not an offer to sell or the solicitation of an offer to buy any security. BMO Capital Markets or its affiliates will buy from or sell to customers the securities of issuers mentioned in this report on a principal basis. BMO Capital Markets or its affiliates, officers, directors or employees have a long or short position in many of the securities discussed herein, related securities or in options, futures or other derivative instruments based thereon. The reader should assume that BMO Capital Markets or its affiliates may have a conflict of interest and should not rely solely on this report in evaluating whether or not to buy or sell securities of issuers discussed herein.

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