U.S. stock markets are pointing to a weaker start on Tuesday as traders digest a weak housing report, tame inflation data as well as less than encouraging news from some major companies.

The U.S. Commerce Department reported on early Tuesday that housing starts fell in August for the fifth time in the past six months as it dropped 6% to a seasonally adjusted 1.665 million-unit annual rate.

As well, the U.S. Labor Department reported that producer price index figures for August rose by 0.1%, matching July’s increase. A 0.3% increase was expected.

Meanwhile, news from DaimlerChrysler and Dow Jones were less than encouraging. DaimlerChrysler reported that its Chrysler division expects retail shipments to fall by 90,000 vehicles in the third quarter. As well, Dow Jones reported that September advertising revenue for its flagship newspaper, The Wall Street Journal, is running below the company’s expectations.

At home, Canada’s inflation rate eased for the third straight month in August. Statistics Canada reported that despite strong advance in the housing sector, weakening gasoline prices slowed down the 12-month growth of prices paid by consumers. Between August 2005 and August 2006, the Consumer Price Index posted a 2.1% increase from 2.4%.

The Canadian dollar opened at US89.43¢, down US0.02¢. On Monday, the loonie had risen US0.09¢.

Oil prices slipped in early Tuesday trading after briefly rising above US$64 a barrel following news that output at a BP PLC platform in the Gulf of Mexico won’t be restored before mid-2008. Light sweet crude for October delivery fell US25¢ to US$63.55 a barrel.

On Monday, Toronto stocks rallied after a week in which the market lost 1.8%, as commodities prices rebounded and the resource sectors bounced back.

The S&P/TSX composite index gained 107.51, or 0.92%, to 11,763.55.

Six of the 10 TSX main sub-groups were up, with the energy index surging 2.62%.

The S&P/TSX Venture Exchange index gained 11.28, or 0.44%, to 2,577.52.

In New York, markets moved forward, but only marginally, as investors awaited the next U.S. Federal Reserve interest rate decision coming later this week.

The Dow Jones Industrial Average fell 5.77 points to 11,555.00. The Nasdaq ended essentially flat, up 0.16 of a point at 2,235.75. The S&P 500 Index rose 1.31 points to 1,321.18.