The Canadian Press

Malcolm Morrison

The Toronto stock market seemed headed for a lower open on Tuesday as commodity prices declined amid worries about the pace of a global economic recovery.

The heightened concerns followed the release of figures showing Britain emerged from recession far slower than anticipated while investors were also worried about restrictions on bank lending in China.

The Canadian dollar was down 0.48 of a cent to US94.03¢ amid a strengthening U.S. dollar.

There was also some major corporate dealmaking in Canada. World Color Press Inc. (TSX:WC), the Montreal-based printing giant formerly known as Quebecor World, has agreed to be taken over by Quad/Graphics Inc. in order to create a combined company with 30,000 employees.

Quad/Graphics Inc. is currently the largest privately held printer in the United States but plans to go public in connection with the World Color takeover.

World Color Press is the publicly traded company that was formed after the former Quebecor printing business was restructured under court protection from its creditors.

U.S. futures also pointed to a mainly tepid open with the Dow Jones industrial futures down three points to 10,137. The Nasdaq futures gained 1.5 points to 1,800 following a well-received earnings report from Apple Inc. after the market close, while the S&P 500 futures declined 2.6 points to 1,090.

Oil prices slid well below $75 a barrel Tuesday, weighed by weaker stock markets in Europe and Asia and a stronger dollar. The March crude contract on the New York Mercantile Exchange declined 69¢ to US$74.57 a barrel.

The February gold contract on the Nymex declined $4.30 to US$1,091.40 an ounce while March copper stepped back 4¢ to US$3.35 a pound.

Figures Tuesday showed that Britain finally emerged from recession in the last three months of 2009 — after six consecutive quarters of falling output — but only at a quarterly rate of 0.1% as the services sector barely grew. That was way less than the 0.4% consensus expectation in the markets.

Meanwhile, Chinese banks started implementing last week’s decision to up reserve requirements. Investors are particularly worried about policy changes in China as the country’s growth helped limit the impact of the global recession over the last year. Figures last week showed that China’s economy grew 10.5% in the final three months of the year from the year before.

The worry is that tighter monetary policy in China to check inflationary pressures could kill off the nascent economic recovery around the world.

Huge sales of the iPhone and Macintosh computers led to a nearly 50% jump in net income at Apple.

Apple also offered a profit and revenue forecast above Wall Street forecasts and its shares were up about 2.1% in pre-market trading.

On Tuesday, earnings from some major companies, including insurer Travelers Cos., and chemical company DuPont also provided some hope that the economy is strengthening.

In Canada, Indigo Books and Music Inc. (TSX:IDG) said Monday it earned $34.5 million for the quarter, up nearly 30% from the same period a year earlier.

Investors are looking ahead to consumer confidence data coming out later in the morning. The Conference Board’s index is expected to show a third straight month of improvement, but also that the economy is still far from healthy. The Conference Board’s consumer confidence index likely rose to 53.5 from 52.9 in December.

A reading above 90 means the economy is on solid footing. Above 100 signals strong growth.

Investors will also take in the latest reading of the S&P/CaseShiller Home Price Index. Economists estimate the index of 20 major cities fell 5.1% compared to November last year.

Earlier in Asia, China’s Shanghai index led the region lower following reports that China’s banks have had their reserve requirements increased again. Following those reports, the benchmark Shanghai Composite Index fell 2.4% to its lowest since Oct. 30, 2009.

“It was later clarified that this was simply an implementation of an earlier decision and that no new banks had been affected,” said Gareth Berry, an analyst at UBS. “Markets took no chances however.”

Elsewhere in Asia, Japan’s Nikkei 225 stock average retreated 1.8% and Hong Kong’s Hang Seng sank 2.4%.

London’s FTSE 100 index dipped 0.22%, Frankfurt’s DAX was flat and the Paris CAC 40 declined 0.1%.