North American markets may open lower as investors mull over disappointing earnings from Alcoa and the long-awaited restated earnings from Nortel Networks.

This morning Nortel reported an audited profit of US$434 million for 2003. The restated earnings correct its year-ago report of a profit of US$732 million after an accounting scandal that toppled major executives. Earnings for the year ended Dec. 31, 2003, amounted to 10¢ a share instead of US17¢.

Nortel also said 12 executives have agreed to pay back the US$8.6 million in bonuses based on the old figures, and that chairman Lynton Wilson and four directors are stepping down.

Yesterday, shares of Nortel advanced 2¢ to $4.11.

After markets closed Monday, U.S. aluminum producer Alcoa Inc. posted an 8% decline in fourth-quarter profit, missing Wall Street expectations.

In Tuesday’s economic news, Canada Mortgage and Housing Corp. said the seasonally adjusted annual rate of housing starts was 234,400 in December, down from 242,600 in November.

“New home construction posted a 17-year high in 2004 with an estimated 233,000 starts representing 6.7% growth over 2003,” said Bob Dugan, chief economist at CMHC’s Market Analysis Centre.

There are no major economic releases from the United States today.

Toronto stocks posted modest gains Monday as stocks traded in a narrow range ahead of corporate earnings season. The S&P/TSX composite index rose 20.61 points, or 0.23%, to 9,026.83. Volume was 227 million shares.

The junior S&P/TSX Venture composite index slipped 3.85 points, 0.22%, to 1,781.05.

The Canadian dollar closed at US81.79¢ versus the U.S. dollar, up from Friday’s Bank of Canada close of US81.17¢.

On Wall Street, U.S. markets also closed with small gains, after stocks retreated from their best levels in the final hour of trading.

The Dow Jones industrial average was up 17.07 points, or 0.16%, at 10,621.03.

The S&P 500 rose up 4.06 points, or 0.34%, to 1,190.25. The tech-heavy Nasdaq composite index was up 8.43 points, or 0.40%, at 2,097.04.