North American markets are expected to open flat Thursday, as traders consider a better-than-expected report on U.S. weekly jobless claims and await data on leading U.S. economic indicators and manufacturing.

Initial jobless claims fell by 3,000 to a seasonally adjusted level of 334,000 in the week that ended Nov. 13, the Labor Department said today. The four-week average, however, rose by 1,000 to 338,250. Economists had called for a drop of 1,000 claims.

The U.S. Conference Board is scheduled to release its index of leading indicators for October at 10:00 ET., and the Federal Reserve Bank of Philadelphia is due to report its manufacturers’ business outlook survey for November at noon.

Meanwhile investors will be digesting a report in today’s Globe and Mail that four big mutual fund companies have agreed to pay about $200 million in restitution for questionable trading practices.

The four companies — Investors Group Inc., CI Fund Management Inc., AGF Management Ltd. and AIC Ltd. — are among the largest players in Canada’s fund industry. The firms have been in talks with the Ontario Securities Commission for several weeks.

Investors will also be reacting to news that CI has ruled out the prospect of turning the fund company into an income trust, citing legislative uncertainty from the federal government.

The lack of clarity from Ottawa has prompted CI to dismiss the trust idea, CI president and CEO Bill Holland told shareholders at the firm’s annual meeting yesterday.

On Wednesday, Toronto stocks closed higher, but fell back from the 9,000 point level hit earlier in the session. The S&P/TSX composite index ended up 35.60 points, or 0.54%, at 8,987.60. Volume was a robust 339 million shares.

The junior S&P/TSX Venture composite index finished up 20.04 points, or 1.21%, at 1,680.12, on volume of 88 million shares.

U.S. stocks ended higher but off their best levels Wednesday as a spike in oil and concern over a weakening dollar blunted a rally sparked by Kmart’s US$11 billion merger with Sears, strong Hewlett-Packard earnings and solid economic data.

The Dow Jones industrial average ended up 61.92 points, or 0.59%, at 10,549.57, after climbing as high as 10,602.85 in late morning trading.

The Nasdaq composite index rose 21.06 points, 1.01%, to 2,099.68. A broad rally in technology shares, led by hardware stocks underpinned the gains on the tech-rich index.

The S&P 500 Index was up 6.51 points, or 0.55% at 1,181.94.