Markets are muted in reaction to yesterday’s decision by Federal Reserve Board to hold the line on interest rates. The S&P/TSX composite index is up a single point at midday to 8,457, on relatively light volume of 126.4 million shares, as traders digest a slew of earnings reports.

Buying action is outpacing the selling by a margin of about 12 to seven. Market breadth is solidly bullish too, as winners outnumber losers six to five.

On a sector basis, the miners continue to make gains, as do techs, telecoms and biotechs. Energy stocks are seeing some profit-taking,however, as are golds and consumer staples.

Nortel continues to be a hot trader, up another 2% today in strong volume of 22.1 million shares.

Research in Motion is up 2.7% on word that the Blackberry is about to debut in France.

Traders are mulling over series of earnings reports in the telecom sector, where it’s earnings day today. BCE is up 0.5% on news that it earned $488 million in the first quarter. It also confirmed its annual full year 2004 financial guidance of revenue growth comparable to 2003 growth; mid to high single-digit growth in earnings per share; and, free cash flow of approximately $1 billion.

BCE rival, Telus, reported that its first quarter earnings rose to $101.3 million. Earnings per share for the first quarter were 28¢, compared with 26¢ for the same period a year ago. Free cash flow was $443 million this quarter, a $176 million improvement from a year ago.

Microcell Telecommunications reported a quarterly net loss of $14.7 million, compared with net income of $35.3 million for the first quarter of 2003. Net income for the first three months of 2003 resulted from a $103.2 million foreign exchange gain, compared with a foreign exchange loss of $7.3 million for the same period this year, due to the relatively higher level of US-dollar denominated debt.

The action also has Manitoba Telecom up 0.7% in active trading, and Mitec has added 13%.

Energy stocks are giving back some of yesterday’s big gains. Suncor is down 1.5%, EnCana has dropped 2%, Petro Canada and and Talisman Energy are down, too.

Canadian Natural Resources is down almost 2%, after it reported net earnings of $258 million for its latest quarter, compared with $427 million for the first quarter of 2003 and $250 million in the previous quarter.

Notwithstanding the profit taking in energy stocks, Alcan is holding onto its gain, up 0.7%.

A big merger deal in the mining group is also providing some interest. Inmet Mining and Aur Resources have agreed to a so-called merger of equals to create a new global mining company. The new company will be called Aur Mining Corporation, with a market capitalization of approximately US$1 billion, creating one of North America’s premier copper producers. Aur is up 8.3% on the news, but Inmet is down 1.3%.

News is also driving some of the other gainers. CryoCath Technologies is up about 7% on news that it has received regulatory clearance from the US Food and Drug Administration for FrostByte, a clamp ablation device to be used in the treatment of cardiac arrhythmias.

Quebecor World has gained 6.6% after it reported Q1 net income of $36 million. This compares with net income of $24 million in the first quarter of 2003.

Other gainers include Bennett Enviro, Zenon Enviro, Angiotech and Minefinders.

The financials are holding up, too, despite a small slide in Royal Bank and Manulife. CIBC is up 0.7% though.

On the downside, Creo has dropped more than 12% on news that it earned $2 million in its second quarter.

Open Text has dropped 7.7% on news that reported total net income for the third quarter was $3.3 million, compared with net income of $6.8 million, in the third quarter a year ago. In the quarter the company incurred an after-tax restructuring charge of $7.5 million.

Other losers include Aeterna Labs, Precision Drilling, Russel Metals, Golden Star Resources, Pengrowth and GMP Capital.

In other earnings news, Loblaw Companies Ltd. reported that its earnings increased to $176 million in Q1 from $151 million in 2003. It says that the outlook for the remainder of the year is for continued good growth in sales and net earnings, constrained by food price deflation in certain markets.

Torstar Corp. reported that net income was $23.0 million in the first quarter, down $2.1 million from the first quarter in 2003. It also announced a two million share buyback.