North American stocks are likely to drop Wednesday after China moved to triple taxes on stock trades.
Investors also are waiting for the release of minutes from the recent U.S. Federal Reserve meeting.

The Shanghai Composite Index stumbled 6.5% after China’s tax hike. In February, a big drop in Shanghai led to large declines elsewhere.

Outside of China, global markets declined on Wednesday, but not precipitously. The Nikkei 225 closed with a 0.5% loss in Tokyo, and the FTSE 100 was down 0.9% in London.

In economic news, the minutes from the Fed meeting, which are at 14:00 ET.

Here at home, Canada’s current account surplus with the rest of the world increased $1.9 billion in the first quarter of 2007 to $6.5 billion, on a seasonally adjusted basis, Statistics Canada reported. In the capital and financial account (not seasonally adjusted), Canada’s international assets, led by record investment in foreign securities, grew faster than Canada’s international liabilities.

Separately, StatsCan said petroleum and metals pushed up the prices for manufactured goods and raw materials in April.

The Canadian dollar opened at US93.42¢, up 0.27 of a cent.

On Tuesday, the loonie closed up 0.58 of a cent to US93.15¢ after the Bank of Canada signalled interest rate hikes may be needed in the near term to curb inflation.

In M&A news, Paramount Energy Trust has struck a major deal to acquire natural gas producing properties in east central Alberta for $392 million, increasing its reserve base by 100%, the trust said.

Intercontinental Exchange has reached a deal, valued at US$665 million, that would settle a dispute between CBOT Holdings, parent of the Chicago Board of Trade, and its rival, the Chicago Board Options Exchange. The deal would go into effect only if ICE wins CBOT. Both ICE and Chicago Mercantile Exchange have bids out for CBOT; the Board of Trade’s management backs CME.

Wall Street firm Cantor Fitzgerald plans to combine its publicly owned electronic trading house eSpeed with BGC Partners, a bond brokerage unit. It’s offering US$9.75 per each eSpeed share, valuing the deal at US$1.3 billion.

Private-equity firm Madison Dearborn Partners will acquire technology products reseller CDW Corp. for US$7.3 billion it said late Tuesday.

In earnings news, Borders Group posted a wider-than-expected loss during the first quarter.

Oil prices rose as worries about disruptions in Nigeria resurfaced. Light sweet crude for July delivery added 30¢ to US$63.45 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe.

Toronto stocks moved down Tuesday, as falling resources prices weighed down the broader market and investors took in the Bank of Canada’s decision to hold the line on interest rates.

The S&P/TSX composite index fell 111.02 points, or 0.79%, to 13,962.72.

The central bank announced that it would leave the key overnight rate at 4.25%, but hinted that rates might head higher soon if inflationary pressures continue.

Bank of Nova Scotia shares moved up 50¢, or 0.93%, to $54.25 after the it announced a second-quarter profit of $1.04 billion, a jump of 16% from the same period last year.

The S&P/TSX Venture composite index gave up 18.58 points, or 0.58%, to 3,207.55.

In New York, markets moved ahead on merger and acquisition news.

The Dow Jones industrial average gained 14.06, or 0.10%, to 13,521.34, the Nasdaq gained 14.87, or 0.58%, to 2,572.06, and the S&P500 edged ahead 2.38, or 0.16%, to 1,518.11.