By Stewart Lewis

(May 15 – 17:30 ET) – Monday was a day of cautious trading as markets awaited tomorrow’s interest-rate announcement from the U.S. Federal Reserve.

In the U.S. the day ended with a late-session rally by technology shares. The Dow Jones industrial average closed up 198.41 points, to 10,807.78.

The tech-laden NASDAQ Composite Index ended up 78.59 points, to 3,607.65. Late strength in internet and biotechnology issues helped the index add to Friday’s 29 point rise. Despite the session’s gains, volume was light on Monday. Perhaps investors lacked conviction, sidelined by Fed anxiety. Most market watchers expect the Fed to raise its key federal funds rate by an aggressive 50 basis points. Some analysts think a milder increase may be in order.

In Toronto, the TSE 300 composite index closed solidly higher. Canadian investors are also worried about the Fed announcement. Volume was 143 million shares worth $3 billion. There were 615 advancing issues and 486 declines. Ten of the TSE’s 14 subgroups made healthy gains, led by 3% increases each in retail, transportation and financial services.

The CDNX rose 9.2 points to 3,438.3.