North American markets look set to open higher Tuesday, as traders turn their attention to the U.S. Federal Reserve for the latest decision on interest rates.

No surprises are expected when Fed policy makers meet today. They are likely to raise short-term rates another quarter of a percentage point, to 3.5%. An announcement from the Fed is expected at about 14:15 p.m. ET.

In this morning’s economic news, the U.S. Labor Department said nonfarm productivity rose 2.2% in the second quarter, while unit labor costs rose 1.3% Economists had called for nonfarm productivity to rise by 2% following a 2.9% rate of increase in the first quarter.

Later this morning, the U.S. Commerce Department is due to report on June wholesale inventories at 10 a.m. Economists call for a modest increase in inventories of 0.2% from 0.1% the previous month.

There are no major economic releases from Statistics Canada today.

Meanwhile, crude-oil prices eased 15¢ to US$63.79 a barrel in early trading Tuesday, a day after oil futures settled at a record high near US$64 a barrel in New York as supply fears boiled over on terror concerns in Saudi Arabia and refinery outages in the U.S.

In this morning’s earnings news, furniture maker Dorel Industries Inc. said it is reviewing its operations even as second-quarter profit rose 21.4% to US$21.7 million. Earnings for the quarter ended June 30 amounted to 66¢a share, diluted, and compared with US$17.9 million US or 54¢ per share a year ago.

On Wall Street, MCI swung to a profit in the latest quarter despite a 10% drop in revenue, as its cost-cutting efforts paid off.

Overseas, London’s benchmark FTSE 100 index was up slightly recently on strong demand for metals and mining stocks. In Japan, the Nikkei 225 Stock Average ended up 1% at 11,900.32, as the market shifts focus to corporate earnings, economic data and away from politics.

Toronto stocks ended higher Monday, as a surging energy sector and a strong showing in the technology group overshadowed a poor day in financials.

The S&P/TSX composite index finished up 63.85, or 0.61%, to 10,614.36.

The senior exchange reached triple-digit gains in intra-day trading, but levelled off as the market reacted to the skyrocketing price of oil.

Six of the 10 TSX main sub-groups ended higher on the day. Energy shares gained 2.01%, while the IT sector lifted 2.99%. The heavily weighted financial group was off 0.69%

Telecom giant Nortel Networks Corp. posted a US$45 million profit for the second quarter, up from earnings of US$16 million a year ago. The shares gained 40¢, or 12.50%, to end $3.60 on heavy trading. Nortel gained US31¢ cents to close at US$2.96 in New York.

Bank of Montreal said it was selling Harrisdirect, its U.S.-based discount brokerage, to E-Trade Financial Corp. for $910 million. It shares dropped 6¢, or 0.15%, to close $41.29.

The junior S&P/TSX Venture composite index finished up 7.18, or 0.39%, to close 1,839.29

In New York, crude oil prices dampened investor enthusiasm.

The Dow Jones Industrial Average closed down 21 points at 10,536, its lowest close in one month. The Nasdaq composite fell 13.52 points to 2,164. The S&P 500 closed down 3.29 points at 1,223.13.