North American stocks may slip at Wednesday’s open amid diminishing hopes for a rate cut in the U.S. and a rate increase by the European Central Bank.

The European Central Bank today raised its benchmark rate a quarter of a percentage point to 4%

In M&A news, two hedge funds that own stakes in TD Ameritrade Holding Corp. are pushing the online brokerage to seek a large merger, saying Ameritrade could boost shareholder value by joining with E-Trade Financial Corp. or Charles Schwab Corp. The funds are managed by Jana Partners and SAC Capital Advisors.

In North American economic news, the U.S. Labor Department said first-quarter nonfarm business productivity climbed at a 1.0% rate compared to the prior quarter, down from an initially estimated 1.7% increase. Wall Street was expecting a 1.0% gain.

Unit labor costs — a gauge of inflationary pressures — rose by 1.8% in the first quarter, up from the prior estimate of 0.6%. Economists had forecast a 1.5% climb in unit labor costs.

Here at home, Statistics Canada reported that the total value of building permits declined in April as construction intentions fell in both the residential and non-residential sectors as well as in nine provinces. Contractors took out permits worth $5.6 billion, down 8.4% from March.

The Canadian dollar was little changed trading up 0.05 cent at US94.12¢.

In earnings news, Aber Diamond said its first-quarter sales rose 18.5% to US$141 million and operating profit grew 29% to US$36 million. But a future-tax hit caused by the strong Canadian dollar cut net income to US$3 million, compared with US$24 million a year ago.

Western Forest Products reported first-quarter earnings of $7.2 million, up from a year-earlier loss of $53.6 million, despite the weak American lumber market. The B.C. lumber maker’s gain was partly attributed to the strong Canadian currency.

Oil prices slipped 9¢ to US$65.52 on the New York Mercantile Exchange as Cyclone Gonu continued to weaken in the Persian Gulf and as traders squared positions ahead of a weekly report on energy inventories.

In overseas markets, the FTSE 100 dropped 0.9% and the Nikkei 225 slipped 0.1% in Tokyo.

Toronto stocks eased lower Tuesday, as strength in the resource sectors was overshadowed by weakness in the gold sub-group and a negative session in the financial sector.

The S&P/TSX composite index dipped 5.05 points, or 0.04%, to 14,141.69.

The S&P/TSX Venture composite index ended the day flat, up just 0.12 of a point to 3,279.13.

In New York, markets were down in reaction to comments from U.S. Federal Reserve chief Ben Bernanke suggesting the domestic economy was likely to rebound. That dashed hopes for an interest rate cut anytime soon.

The Dow Jones industrial average lost 80.86 points, or 0.59%, to 13,595.46, the Nasdaq composite index fell 7.06, or 0.27%, to 2,611.23, the S&P500 dipped 8.23, or 0.53%, to 1,530.95.