Wall Street futures indicate a mildly pointed open for North American equity markets, though economic reports released this morning may foreshadow better market performance in the U.S. than in Canada.

Some analysts predict the U.S. economy will grow and surpass the superior performance of the Canadian economy.

Statistics Canada reports a drop in GDP — the first drop in a year and a half. The economy experienced its first contraction since the events of September 11, 2001, says StasCan. GDP fell 0.2% in April. Industrial production — manufacturing, mining and utilities — fell a further 0.8%, the third consecutive monthly decline. Electricity generation and natural gas distribution were adversely affected by a decline in the demand for heating fuels. There were widespread declines in production levels in the manufacturing sector.

Although the drop in energy prices was welcomed by consumers, says StasCan, it led to reduced exploration of oil and gas. In the meantime, oil production was hampered by maintenance shutdowns.

In a separate report, StasCan says that manufacturers’ prices weakened 2.0% in May from April, in large part because of a stronger Canadian dollar relative to the US dollar. On an annual basis, the Industrial Product Price Index declined 1.7% from May 2002, following a 0.4% decline in April.

From a monthly perspective, lower prices for motor vehicles and other transport equipment (-3.7%) and petroleum and coal products (-6.5%) were the major contributors to the decline of the IPPI. A decrease in lumber and other wood products (-2.5%) was due to oversupply and lower demand for softwood lumber, as well as declining prices for plywood. Prices for pulp and paper products also fell (-2.5%), as did those for electrical and communication products (-2.0%). On an annual basis, lower prices for motor vehicles and other transport equipment (-8.2%), lumber and other wood products (-13.4%), and electrical and communication products (-0.3%) were the major contributors to the year-over-year decline in the IPPI.

U.S. market watchers were greeted with better news from the U.S. Department of Commerce, which said personal income rose in May, giving a modest boost to consumer spending. It rose 0.3% last month, while personal consumption edged up by 0.1% in May after also rising by a revised 0.1% a month earlier. April income was previously estimated as being flat while spending had been estimated as a 0.1% decline. Disposable personal income, or income after taxes, rose 0.3% for the month after a 0.2% rise in April.

Asian stock markets closed higher during their Friday trading, following Thursday gains on Wall Street. Tokyo’s Nikkei rose 180.65 points, or 2.02 per cent, to 9,104.06 points. Shares in Japan’s export-oriented electronics and auto industries led the Nikkei higher on the back of a stronger U.S. dollar. Hong Kong stocks ended slightly higher, breaking a five-session losing streak. The Hang Seng Index rose 51.10 points, or 0.53 per cent, to 9,657.21.

In Europe, London FTSE is up 0.34% at midday, but the Paris and Frankfurt markets are down.

In regulatory news, the Wall Street Journal is reporting that the Securities and Exchange Commission is expected to approve a rule today that will require companies listed on U.S. markets to win shareholder approval of all stock compensation plans. The long-awaited move will essentially prevent companies from awarding lucrative stock-option packages to executives, directors and others without explicit shareholder approval. Brokers holding shares for their clients will also be barred from voting on equity-compensation plans unless the owner has given voting instructions. The SEC will direct the New York Stock Exchange, the Nasdaq Stock Market and other major markets to include the rule as part of their listing standards starting on Monday.

Meanwhile, the U.S. Financial Accounting Standards Board is set to require companies that maintain defined-benefit pension plans for their workers and retirees to make quarterly financial disclosures that detail the plans’ impact on earnings. Currently, companies are required to contain such disclosures on an annual basis.