Stocks are up on light volume ahead of the highly anticipated interest rate decision by the Federal Reserve Board this afternoon. At midday, the S&P/TSX composite index is up 25 points to 7,013.

Market pundits are evenly divided over the question of whether the Fed is likely to cut 25 or 50 basis points.

Toronto volume is quite light at 90.4 million shares, with the buying ahead of the selling 23:18. Market breadth is also modestly positive, with winners edging losers 48:43.

Most TSX sectors are showing modest gains today. Techs are the exception, gaining another 2.3%. Golds and energy stocks are up too, but most other sectors have very small nominal gains. Today’s losers include health care and real estate stocks.

Nortel is driving the tech gains, up 2.3% on decent volume of 9.6 million shares. ATI is the big gainer though, up more 13% in strong trading.

Financials remain strong traders today. Insurers are losing some ground, with Canada Life ticking down a little on heavy volume of more than 3 million shares. Great-West Lifeco has dropped 0.4% on 1.2 million shares.

Among the banks, RBC is down 0.4%. It has filed a preliminary prospectus for the issuance of innovative tier 1 capital. It intends to issue trust capital securities that will qualify as capital of the bank for regulatory purposes. Its existing capital trust is up 5% on the news.

Scotiabank is up 0.4% in active trading.

Other gainers include Inco, Dofasco, EnCana, Thunder Energy, CanWest, Shaw Communications, Air Canada and CAE.

The downside is seeing weakness in TLC and QLT on the biotech side. O&Y Properties is leading the real estate group down. And, there is selling in Provident Energy Trust, Nova Chem, Agrium and Cott.

In earnings news, Sobeys reports that it had net earnings of $179 million for its year ended May 3. This represents an increase of 11% over the operating earnings of $161.6 million reported last year, after adjusting for the change in the accounting treatment of good will.

On the financing front, Onex has entered into a bought deal agreement to sell approximately 27.2 million units of Rogers Sugar Income Fund for gross proceeds of approximately $111.7 million, to a syndicate of underwriters, co-led by Scotia Capital and RBC Capital Markets.

In the U.S., markets are in a holding pattern ahead of the Fed decision. Mixed economic news isn’t having much effect. The Dow Jones industrial average is up 29 points to 9,138. The S&P 500 has gained six ticks to 990. The Nasdaq composite is up 20 points at 1,626.

The S&P/TSX Venture index has gained three points to 1,103. Volume is light at 15.7 million shares. Stornoway Ventures is the day’s top trader, flat at $1.42 on 523,500 shares.