North American stock markets may open lower Friday, ahead of the three-day Canada Day weekend and the U.S. July 4 holiday on Tuesday.

Markets rallied strongly on Thursday after the U.S. Federal Reserve raised interest rates for the 17th consecutive time.

As widely expected, the central bank boosted its short-term interest-rate target to 5.25% from 5%. But for the first time since it began raising rates from a low of 1%, in June 2004, the Fed didn’t explicitly say another rate increase was under consideration. Investors took that as a welcome signal.

In economic news, U.S. personal income increased at a seasonally adjusted monthly rate of 0.4% in May, after rising a revised 0.7% in April, the Commerce Department said Friday.

Later today, a report on June consumer sentiment is slated for release at 9:45 ET, and the June Chicago Purchasing Managers Index is expected at 10:00 ET.

The Canadian dollar opened at US89.91¢, down 0.06 of a cent.

Among stocks to watch, Canadian Oils Sands Trust has raised its offer for Canada Southern Petroleum in response to a sweetened bid from Petro-Canada.

Earlier Friday, Canadian Oil Sands hiked its friendly offer to US$11.10 per share in cash. Its previous bid was for US$9.75 per share.

Canada Southern has endorsed Canadian Oil Sands’ increased offer and is recommending that shareholders accept it.

The higher offer comes a day after Petro-Canada boosted its bid to US$11 per share.

Apple Computer said it has launched an internal probe of executive stock options granted over a four-year period, including a grant to Chief Executive Steve Jobs. Separately, CA said it isn’t able to provide audited results for its fiscal year ended March 31 because of newly discovered problems with reporting of options dates from 1997 to 2001.

Research In Motion may rise, however, after posting a 35% sales rise and meeting Wall Street expectations on growth.

Crude-oil futures rose 15¢ to US$73.67 a barrel in early trading Friday amid concerns about shrinking gasoline stocks ahead of the Independence Day holiday weekend.

In other news, the European Commission charged MasterCard with fixing the fees retailers must pay for accepting MasterCard and Maestro branded cards, saying this limits competition between banks that use the service.

International stock markets showed strength Friday, with the German DAX 30 up 1.2% in Frankfurt.

Tokyo’s benchmark Nikkei 225 index gained 384.03 points, or 2.54%, to 15,505.18 points.

In Hong Kong, the Hang Seng Index surged 402.40 points, or 2.54%, to 16,267.62.

North American stocks rallied Thursday, as investors on both sides of the border rushed back into the market, buoyed by the U.S. Federal Reserve rate-hike announcement.

The S&P/TSX composite index rose 188.59, or 1.66%, to 11,520.91.

ATI Technologies reported earnings that fell short of guidance. Its stock fell $2.26, or 13.05%, to $15.06.

The S&P/TSX Venture composite index gained 37.17 points, or 1.46%, to 2,576.89.

In New York, markets surged by their highest one-day point gains in three years, as investors were buoyed by hopes the Fed is nearing the end of its rate-tightening cycle.

The Dow Jones industrial average closed up 217.24 points, or almost 2%, at 11,190.80. The S&P 500 rose 26.87 points, or 2.1%, to 1,272.87, while the Nasdaq composite index rose 62.54 points to 2,174.38.