Stocks are set to decline at the open Thursday as investors continue to fret over the price of oil.

In this morning’s economic news, U.S. workers were more productive than previously thought during the first three months of 2004, suggesting the recent surge in job creation isn’t likely to trigger a serious bout of inflation anytime soon.

Non-farm business productivity grew at a seasonally adjusted annual rate of 3.8% from January through March, up from the initial estimate of a 3.5% increase, the Labor Department said Thursday. In year-on-year terms, the increase was 5.5%, the largest in 31 years.

The numbers matched Wall Street’s expectations.

Meanwhile, U.S. initial jobless claims fell by 6,000 to a seasonally adjusted level of 339,000 in the week that ended May 29, the Labor Department said today. That was the lowest level since the week that ended May 8.

North of the border, Statistics Canada reported today that corporate profits increased 6% in the first quarter of 2004, fueled by gains in the oil and gas and banking sectors.

Eight increases in the past nine quarters have boosted operating profits to a record high of $47.4 billion, StatsCan said.

Overnight in Asia, markets fell sharply. Japan’s Nikkei fell 215.29 points, or 1.9%, to finish at 11,027.05 as oil futures crept higher.

Shares in Hong Kong plunged in a widespread sell off of banks, real estate issues and Chinese companies that could be hurt by any slowdown in the mainland economy. The Hang Seng plunged 271.82 points, or 2.23%, to 11,929.93.

Stocks in Toronto slipped on Wednesday after Nortel Networks Corp. announced that it cannot say when it will restate its financial results for 2003 and the first quarter of 2004. It did not offer an anticipated filing date. The S&P/TSX composite index closed down 48.49 points at 8,369.89.

The junior S&P/TSX Venture composite index slid 9.85 to 1,593.37.

It was a different story for blue chips in the U.S., which rose as crude oil prices fell below $40 per barrel. The Dow Jones industrial average added 60.32 points to 10,262.97. The S&P 500 gained 3.79 points to 1,124.99, its highest close since April 27.

The tech-heavy Nasdaq composite index was hurt by market concern over the future prospects for tech companies. It fell 1.79 points to 1,988.98.