North American equity markets opened lower Tueday morning, but at midday they are gradually clawing their way higher ahead of this afternoon’s decision on U.S. interest rates. The S&P/TSX index is up 14 points to 6,586.

Volume is better than yesterday, but still weak at 60.6 million shares. The split between buyers and sellers is more or less even. Market breadth is supportive though, with winners outpacing losers by nine to seven.

Tech stocks are the source of strength, adding about 2% so far today, on some bargain hunting. Telecoms are up more than 1% as well, but most of the other gains are quite modest. Materials, financials and energy stocks have all made slight gains. Industrials are still 2% weaker, due to troubles in transports, and there are some losses in consumer stocks, too.

Nortel Networks is leading the tech group higher, with a 5% gain. It is joined by some hearty buying in Celestica and Research in Motion. BCE is up 2.2%, leading the telecoms higher once again.

The roster of other notable gainers is a mixed bag, including TD Bank, Barrick Gold, Stelco, Potash, Agrium, ATS Automated Tooling and CoolBrands. Meota Resources is up almost 10% on news that it will be acquired by Provident Energy Trust.

Bombardier is the big loser today, down 9% on strong volume of more than 8 million shares. The stock is getting pummeled on news that Amtrak has suspended its high-speed rail service, which uses cars built by Bombardier and Alstrom, to inspect for shock absorber cracks in the cars.

More modest losses are coming in a variety of names, including Manulife Financial, CN Rail, Petro Canada, Air Canada, CAE, Tembec, QLT and Vincor.

Co-Steel is down 8% on news of its planned merger with a Brazilian steel firm’s North American assets.

In earnings news, Dorel Industries reported that second quarter earnings were up 48% to $14.9 million.

Burntsand saw a second quarter net loss of $17.3 million, a decrease from the net income, before good will amortization, of $1.7 million for the second quarter of 2001. The loss for the quarter includes a restructuring charge of $10.7 million.

In New York, Tuesday’s opening weakness has been met with a late morning rally. But really, traders are waiting to hear from the Fed this afternoon. Hopes for a rate cut have evaporated, but traders will be watching the Fed’s policy comments for signs of possible future action.

The Dow Jones industrial average is holding a 34 point gain at midday to 8,723. The S&P 500 has added six ticks to 909. Nasdaq is up 12 points to 1,319.

The small caps are little changed in today’s languid trading. The S&P/TSX Venture index is down two ticks to 1,033. Volume remains weak, with 8.6 million shares changing hands. Crescent Point Energy is the top trader, up 2% on 367,500 shares.