North American equity markets appear headed for a modestly lower start, and - similar to Monday - most of the interesting action today will likely be in a handful of individual stocks rather than the indexes.
The tech sector will especially be in focus, where Facebook will end the mystery of what it'll present at a press presentation today, Dell will continue to be the subject of rumours that it may go private, and Apple and Research In Motion see more trading volatility.
For the market as a whole, a key focus remains on the U.S. budgetary mess and the political wrangling that lies ahead over spending and the debt ceiling. Fitch Ratings overnight reiterated its warning that a delay in raising the U.S. government's debt ceiling would lead to a formal review of the country's AAA sovereign credit rating. President Barack Obama Monday provided a taste for the acrimonious talks to come, saying he won't bargain with Republicans over raising the debt ceiling and called for separate discussions on spending cuts to reduce the deficit.
The U.S. Treasury is using extraordinary measures to pay bills, as the government's $16.4-trillion (U.S.) debt ceiling was reached at the end of last month. A deal on the ceiling is needed to be reached sometime over the next six to eight weeks.
Offsetting some of these fiscal concerns is optimism that the fourth-quarter earnings season will be a favourable one. Already, 28 companies on the S&P 500 have reported quarterly earnings - and about 79 per cent beat projections, according to Bloomberg. On average, analysts are expecting earnings growth of 2.5 per cent.
There was gloomy news out of Europe overnight again, where Germany reported its gross domestic product shrank by 0.5 per cent in the final three months of 2012, the worst quarterly performance since the country fell into a recession during the global financial crisis in 2008/2009 and only the second contraction since it ended. Overall growth for the year was 0.7 per cent, a tad below consensus forecasts for growth of 0.8 per cent.
Now, here's a closer look at what else you need to know this morning:
U.S. futures: S&P 500 -0.5 per cent; Dow -0.4 per cent; Nasdaq -0.4 per cent
Hong Kong's Hang Seng index -0.13 per cent
Shanghai composite index +0.62 per cent
Japan's Nikkei +0.72 per cent
London’s FTSE 100 -0.11 per cent
Germany’s DAX -1.07 per cent
France's CAC 40 -0.41 per cent
WTI (Nymex Mar) -0.04 per cent at $94.55 (U.S.) a barrel
Gold (Comex Feb) +0.68 per cent at $1,680.80 (U.S.) an ounce
Copper (Comex Mar) -0.34 per cent at $3.62 (U.S.) a pound
Canadian dollar down 0.0012, or 0.11 per cent, at $1.0150 (U.S.)
ECONOMIC INDICATORS TO WATCH:
The Canadian Real Estate Association is expected to report on existing home sales in December. Economists expect unit sales to be 17 per cent below year-earlier levels, and prices to be unchanged.
The U.S. Commerce Department said retail sales in December rose 0.5 per cent, beating economists' expectations for a rise of 0.2 per cent.
The U.S. Labour Department said the producer price index in December fell 0.2 per cent, close to the Street expectation for a monthly drop of 0.1 per cent.
STOCKS TO WATCH:
Lululemon shares are down 7 per cent in U.S. premarket trading after the retailer Monday projected fourth-quarter sales guidance a little below analysts' estimates. Canaccord Genuity this morning is recommending investors buy on any dip and affirmed its $91 (U.S.) price target.
Dell Inc. is up 5 per cent in premarket trading after Bloomberg, quoting unnamed sources, reported Monday that the company may announce a deal as early as this week to go public. Shares had already risen 13 per cent during regular trade on Monday.
Facebook Inc. is holding a press event today at 1 p.m. (ET). It's not known what it'll announce, but there's widespread speculation it may have something to do with new software, video or ad initiatives.
Apple Inc. shares are down 0.10 per cent in the premarket at $501.75. A sustained break below $500 would be bearish from a technical standpoint and could usher in more selling.
Research In Motion Ltd. shares are down about 1 per cent in the premarket. The stock rose nearly 13 per cent on Friday and 10 per cent on Monday and isn't showing signs of a pullback yet, amid optimism about its crucial BlackBerry 10 launch late this month.
Canadian Satellite Radio Holdings, which operates Sirius XM Canada and is the sole provider of satellite radio in the country, said late Monday that it posted its first ever quarterly profit as its first quarter came to an end.
Homebuilder Lennar Corp. reported quarterly profit today that handily beat Wall Street expectations and the homebuilder reported a seventh straight jump in new home orders, indicating that a U.S. housing recovery is well on track. But shares are down 1 per cent in permarket trading as new order growth slowed from the third quarter.
Other earnings today include Cogeco Cable Inc. and Cogeco Inc.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
George Soros's most-promising stock picks.
J.P.Morgan thinks emerging markets have further room to run.
Ensco, the world's second-largest offshore driller, is profiting from a major bet on deepwater drilling. The shares could rally further as earnings climb, suggests Barron's.
If the Shanghai composite can gain a couple more percentage points, it'll be a new bull market for China.
Charles Lieberman, the founder of Advisors Capital Management, has developed a successful equity-oriented strategy that is geared toward investors at or near retirement and designed to provide generous income.
Copper prices are up sharply since last June, but the rally is unlikely to last, says Barron's, as too much supply could choke the market.
Apple and Google have long dominated the smartphone market. Now a new giant, Tizen, is rising to challenge their dominance, with its Linux-based operating system.
Five reasons why coffee is bottoming.
Evidence that sector rotation strategies don't work.
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