Canadian markets were down Wednesday morning, led by energy companies as oil prices dropped after a U.S. government report showed U.S. oil inventories rose more than expected last week. U.S. markets were also lower as a 6.8% decline in shares of Apple Computer Inc. hit technology shares.

At midday, the Standard & Poor’s/TSX Composite Index lost 45.62 or 0.48% to 9447.97 after falling 68 points Tuesday. The TSX Venture exchange was off 9.86 points or 0.58% at 1676.16.

The Dow Jones industrial average was down 55.64 points or 0.58% at 10225.47 after a 103-point drop in the previous session. The Standard & Poor’s 500 Index was down 4.34 points or 0.37% at 1161.88 and the Nasdaq Composite Index slipped 11.93 points or 0.61% at 1950.84.

The Canadian dollar was down 0.70 of a cent to US80.13 amid a disappointing showing in the Canadian trade surplus in March and the increasing possibility of a federal election call.

In Toronto, the TSX energy group was down 0.57% as crude futures retreated from a two-week high after crude oil supplies increased 2.7 million barrels to 329.7 million, the Energy Department reported today. Inventories were expected to gain 1.25 million barrels, according to the median estimate of 16 analysts surveyed by Bloomberg.

Crude oil for June delivery declined 1.7% to US$51.20 a barrel in New York. Prices for crude have jumped 18% this year and reached a record US$58.28 on April 4.

God shares fell 0.82% and financials were off 0.40% on the TSX.

A major deal in the Canadian telecom sector added some excitement to morning trading. Rogers Communications Inc. said it is acquiring Call-Net Enterprises Inc. in an all-stock deal worth about $330 million. Call-Net, through its Sprint Canada subsidiary, provides home phone and local business service, long-distance and wireless services to about 600,000 consumers across Canada.

Rogers shares were down 32¢ or 0.86% to $36.68 while Call-Net shares jumped $2.54 or 38.72% to $9.10.

In New York, stocks declined broadly as investors uncertain about the direction of the economy looked past a reassuring earnings report from Cisco Systems Inc., a narrowing U.S. trade deficit and a drop in oil prices.

Cisco beat analysts’ expectations, and the trade deficit was at its lowest level in six months. Cisco shares were up 8¢ or 0.44% to US$18.29 in late-morning trading. But Apple shares took a hit, falling $2.74 or 7.52% to US$33.68 as tech stocks in general fell.

Overseas, Japan’s Nikkei stock average fell 0.4%. In afternoon trading, Britain’s FTSE 100 was down 0.2%, Germany’s DAX index was up 0.2%, and France’s CAC-40 was down 0.1%.