North American markets are set to rise Wednesday morning, as traders put the Fed rate increase behind them and focus on the Sprint-Nextel merger deal.

The value of Canada’s assets abroad plunged during the third quarter of 2004 as the Canadian dollar appreciated, Statistics Canada said today. As a result, Canada’s net liability to foreign residents rose by 9.2% to $192.9 billion.

In other economic news, crude oil futures moved higher as the northeastern United States felt the first signs of what could likely be a colder-than-expected winter.

The Canadian dollar opened at US81.3¢, up 0.35 of a cent.

In M&A news, Sprint and Nextel announced a US$35 billion merger agreement, which would create a wireless giant.

In business news, BCE Inc., said it is increasing its annual common share dividend by 12¢, or 10%, to $1.32 a share.

After markets closed Tuesday, Nortel Networks released preliminary financial results showing the technology company lost about US$250 million in the third quarter, about half of that due to the startup costs of a major contract in India. The company also said it now expects revenues for the full 2004 financial year will be lower than adjusted revenues in 2003.

Canadian markets higher on Tuesday, while U.S. investors were in a buying mood after the U.S. Federal Reserve Board said all was well with the economy.

At close, the S&P/TSX was up 53.59 points or 0.59% to 9,086.36, while the TSX Venture composite index was mostly unchanged, losing 1.18 points or 0.07% to 1,721.79.

In New York, investors sat on their hands until 2:15 pm when the Fed raised interest rates by 25 basis points, as expected.

The Dow Jones industrials rallied in the afternoon, finishing up 38.13 points or 0.36% to 10,676.45. The Nasdaq composite index added 11.34 or 0.53% to 2,159.84 and the S&P 500 gained 4.70 points or 0.39% to 1,203.38.

Both the S&P 500 and the Nasdaq hit multi-year highs on Tuesday. The Nasdaq reached its highest closing level since June 29, 2001, while the S&P 500 surpassed the 1,200 mark for the first time since August 2001.