Markets are lacking fresh direction so far today, as the S&P 500's rise Tuesday to fresh five-year highs has fuelled further concerns among participants that a short-term correction may be looming.
The benchmark U.S. index has risen a remarkable 7.4 per cent so far this year, fuelled by strong corporate earnings, the avoidance of the dreaded "fiscal cliff" scenario that paralyzed markets at the end of last year, and decent economic data. Now, investors are left wondering whether it's time to take profits, especially as U.S. spending cuts are set to take hold next month unless averted by the U.S. political parties who are not known for their cooperative manner.
U.S. stock index futures are nearly unchanged and European stocks mixed after Asian equities posted modest gains overnight.
There wasn't a lot of fresh news overnight, although minutes from the Bank of England's monetary policy committee meeting and comments from the Reserve Bank of New Zealand suggested that global central banks remain poised to provide further economic stimulus if conditions warrant.
This afternoon, the minutes from the Jan. 29-30 U.S. Fed meeting will be monitored for clues on when U.S. quantitative easing measures may conclude. Minutes from their December meeting revealed members were split between those wanting to halt bond purchases in the middle or at the end of the year.
Here's a closer look at what's going on this morning.
U.S. futures: S&P 500 -0.1 per cent; Dow -0.1 per cent; Nasdaq -0.1 per cent
Hong Kong's Hang Seng index +0.70 per cent
Shanghai composite index +0.59 per cent
Japan's Nikkei +0.84 per cent
London’s FTSE 100 +0.33 per cent
Germany’s DAX +0.23 per cent
France's CAC 40 -0.13 per cent
WTI (Nymex Apr) +0.33 per cent at $97.42 (U.S.) a barrel
Gold (Comex Apr) -0.66 per cent at $1,593.60 (U.S.) an ounce
Copper (Comex May) -0.27 per cent at $3.66 (U.S.) a pound
Canadian dollar down 0.9862, or 0.20 per cent, at $0.9862 (U.S.)
ECONOMIC INDICATORS TO WATCH:
The U.S. Commerce Department said housing starts in January fell 8.5 per cent to 890,000, below the 922,000 that economists had expected. Building permits rose 1.8 per cent to 925,000, near the consensus forecast.
The U.S. Labour Department said the producer price index for January rose 0.2 per cent, defying economists' forecasts for a drop of 0.3 per cent.
(2 p.m. ET) Federal Open Market Committee issues minutes of its last policy meeting.
STOCKS TO WATCH:
Office Depot Inc. has confirmed it will buy rival OfficeMax Inc. The transaction will see Office Depot issuing 2.69 shares for each OfficeMax share. Shares in both companies are up 10 per cent in the premarket.
Dell Inc. shares should rise slightly today after reporting late Tuesday fourth-quarter earnings and revenues that slightly beat analysts' forecasts.
Herbalife Ltd., involved in a heated battle between activist investors Bill Ackman and Carl Icahn, late Tuesday raised its 2013 earnings forecast. Shares are down 0.13 per cent in the premarket.
U.S. luxury homebuilder Toll Brothers Inc. reported a 49 per cent jump in new orders in the first quarter and said it would enter the apartment rental business to take advantage of a supply crunch.
Earnings today include: AngloGold Ashanti Ltd.; Avista Corp.; BHP Billiton PLC; Boralex Inc.; Canam Group Inc.; Centerra Gold Inc.; Crocs Inc.; Devon Energy Corp.; High Liner Foods Inc.; Iamgold Corp.; MGM Resorts International; Pan American Silver Corp.; Tesla Motors Inc.; Yamana Gold Inc.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
While going long the stock market has been a great trade so far in 2013, betting that the bond market would suffer as a result could be the worst.
The 200-day moving average is not a reliable indicator for predicting market tops.
The best stock performers of the past decade are never the best performers of the next decade.
R.I.P. Martin Zweig. The well-known market strategist and newsletter editor who predicted the 1987 market crash dies at age 70.
Currency ETFs are getting more interesting.
The premarket report is constantly updated to reflect the latest news developments and market moves. For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities