The Chicago Fed activity index fell from -0.11 to -0.53 in August. The sub indices of employment, production and income eased in the month. Similarly the Dallas Fed manufacturing index of general business activity fell from -13.5 to -17.5 in September.

European shares were modestly lower on Tuesday, in a lacklustre trading session. Investors were waiting on the UK GDP figures slated for release on Tuesday night. The FTSEurofirst index fell 0.4pct with the UK FTSE lower by 0.5pct and the German Dax lost 0.3pct.

US sharemarkets eased on Monday, as investors locked in recent profits following the four-week rally. Sentiment was still relatively upbeat though volumes remained light. A host of M&A activity suggested that corporate America was more confident about the outlook. Wal-Mart made a $4 billion bid for South Africa´s third largest retailer Massmart . The Dow Jones fell 48pts or 0.4pct with the S&P 500 down 0.6pct and the Nasdaq lower by 11pts or 0.5pct.

US treasuries rallied (yields lower) on Monday as Irish debt concerns fuelled demand for treasuries. Speculation Japan will reinvest around US$20 billion in this week's treasury auctions supported prices. The $36 billion auction of 2yr notes sold at a record low yield of 0.44pct - with a strong bid to cover ratio of 3.78. US 2yr yields fell 3pts to 0.42pct and US 10yr yields lost 8pts to 2.53pct.

The Euro eased from five month highs against the US dollar, as worries about Irish fiscal debt weighed on the currency. The Euro initially rallied from lows near US$1.3430 to US$1.3495, ending US trade near US$1.3470. However this morning the Euro fell to US$1.3440. The Aussie dollar rose from lows near US95.75c to US96.45c, closing US trade near US96.20c. The Japanese yen held between 84.10 yen per US dollar and JPY84.30, ending US trade near JPY84.20.

US crude oil prices recovered from early losses to close virtually unchanged on Monday. Concerns about the Euro zone banking sector and resulting impact on growth, weighed on prices. The Nymex crude oil contract rose by US3 cents to US$76.52. London Brent crude fell US80 cents to US$78.05 a barrel.

Base metal prices were mostly lower on the London Metal Exchange on Monday. Nickel managed to gain 0.8pct while the other metals lost between 0.5-1.8pct. And the Comex gold price finished a touch higher after once again breaking through US$1,300 an ounce. Comex gold hit US1,301.30 before closing up US50 cents an ounce to $1298.60.

Ahead: In Australia, no economic data is released. In the US Richmond Fed index and the S&P CaseShiller Home price index are released.