Stocks face a subdued start after a mixed night in Europe and falls in key commodities while Wall Street was closed for Presidents' Day.
The March SPI 200 futures contract last traded four points or 0.1% weaker at 5038 at midnight on low volume as many futures traders stayed on the sidelines.
Overnight the Stoxx Europe 600 Index dipped 0.2%, its third straight loss, as declines in the UK, Italy and Spain offset gains in Germany and France. Germany's DAX rallied 0.47% and France's CAC put on 0.18%. In the red were Britain's FTSE -0.16%, Italy's FTSE MIB -0.51% and Spain's IBEX 35 -0.51%.
"Today is a featureless day with the markets not doing very much," the chief of the investment committee at Evercore Pan-Asset told MarketWatch. "We did get some reassurance that Germany is likely to avoid recession and that would be taken as good news. A strong Germany is helpful for the recovery and is more likely to help other European countries."
Germany's central bank announced overnight that the economy will likely grow this quarter, averting a technical recession after shrinking 0.6% over the last three months of last year. "From today's perspective, an increase in overall economic output can be expected in the first quarter of 2013. This view is supported by the prospect of the industrial sector," the Bundesbank said in its monthly report.
Miners and banks were among the biggest drags on the UK market. Rio Tinto eased 0.6% in UK trade and BHP lost 0.47%.
Bond yields in Italy inched higher ahead of weekend elections that threaten to derail the country's austerity policies. Former Prime Minister Silvio Berlusconi has pledged to abandon key planks of the government's current program if he regains power.
US futures were little changed as the March 1 deadline for a swathe of automatic spending cuts draws nearer. Dow futures were lately up six points or less than 0.1%.
Commodities were pressured by a rising US dollar after the G-20 meeting declined to criticise Japan for inflationary policies aimed at devaluing the yen. West Texas crude for March delivery was lately 53 cents or 0.5% weaker than this time yesterday at US$95.55 a barrel.
Base metals fell back after the return of Chinese buyers from the week-long Lunar New Year holiday failed to provide a lift. US copper for March delivery sagged five cents or 1.4% to US$3.68 a pound. In London, copper dropped 1.1% to a three-week low, aluminium lost 1.8%, lead 1.6%, nickel 2.7%, tin 1.8% and zinc 0.9%.
"Base metals fell in Asian trading as the Chinese came back to the market with a bearish bent," RBC said in a research note quoted on Reuters. "Worries about oversupply seem to be the focus of the day as prices across the board look weak."
A bounce in gold off multi-month lows during yesterday's Asian trade faded overnight. Spot gold was lately 30 cents weaker at US$1,609.80 an ounce.
TRADING THEMES TODAY
ALL EYES ON EARNINGS: The ASX continues to find reasons to push to fresh four-and-a-half year highs each day, so anything is possible today. Still, the above looks like a pretty uninspiring bag of leads, so any momentum will likely have to come from optimism generated by today's domestic profit reports. Coca-Cola, Arrium, Asciano and Southern Cross are the biggest of those reporting today. China's return to action yesterday from a week-long break was a damp squib - the Shanghai Composite slipped 0.43% and base metals slumped in London. Gold steadied above US$1,600 an ounce but couldn't build on yesterday's Asian rebound.
ECONOMIC NEWS: The minutes from the last Reserve Bank meeting are due at 11.30am EST. Europe has economic sentiment data scheduled tonight. The highlight of a quiet session ahead in the US following the Presidents' Day holiday is the housing market index.
