* Producer Price index, housing data on tap
* Fed minutes due later today
* Futures off: Dow 1 pt, S&P 1.4 pts, Nasdaq 3.75 pts
By Chuck Mikolajczak
NEW YORK, Feb 20 (Reuters) - U.S. stock index futures edged lower on Wednesday, ahead of data on the housing market and inflation, as well as minutes from the Federal Open Market Committee’s January meeting.
Housing starts and permits for January along with the January producer price index are due at 8:30 a.m. (1330 GMT).
Economists in a Reuters survey forecast the housing starts data to show a 925,000-unit annualized rate in January versus 954,000 in December, and a total of 915,000 permits in January compared with 909,000 in the prior month.
PPI is expected to show a 0.4 percent rise after a 0.3 percent drop in December. Excluding volatile food and energy items, PPI is expected to rise 0.2 percent versus a 0.1 percent increase in December.
Later in the session, investors will look to the minutes from the Fed’s January meeting for any clues on how long the current monetary policy will remain in effect.
“We have several economic pieces of news today and of course the one that is eyed the most is going to be the FOMC minutes,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
“Housing starts is in play and the earlier data probably will set the stage for the market to perhaps continue yesterday’s rally but the key will be the FOMC minutes.”
U.S. stocks moved closer to all-time highs on Tuesday, as the ongoing flurry of merger activity to start the year has helped buoy equities from a pullback.
An expected deal that helped lift the market on Tuesday was confirmed on Wednesday when Office Depot Inc said it had reached a definitive deal to buy smaller rival OfficeMax Inc in a bid to get more clout with suppliers and better compete against rival Staples Inc.
Office Depot shares jumped 14.5 percent to $5.75 before the opening bell while OfficeMax surged 15.4 percent to $15. Staples shares gained 2.7 percent to $15.05.
The S&P 500 is up 7.4 percent for the year, fueled by legislators’ ability to sidestep an automatic implementation of spending cuts on tax hikes on Jan. 1, better-than-expected corporate earnings and modestly improving economic data that has been tepid enough for the Fed to maintain its stimulus policy.
S&P 500 futures slipped 1.4 points and were slightly below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures lost 1 point, and Nasdaq 100 futures shed 3.75 points.
As earnings season winds down, S&P 500 companies set to report include Devon Energy Corp and Fluor Corp.
Toll Brothers Inc lost 4.6 percent to $35.20 in premarket trade after the largest luxury homebuilder in the United States, reported first-quarter results well below analysts’ estimates.
SodaStream dropped 5 percent to $49.82 in premarket after the seller of home carbonated drink maker machines posted fourth-quarter earnings and provided a 2013 outlook.
According to Thomson Reuters data through Tuesday morning, of the 391 companies in the S&P 500 that have reported results, 70.1 percent have exceeded analysts’ expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters.
Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.6 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.
European shares dipped on Wednesday, consolidating after a steep rally in the previous session as investors were confronted with news of weak earnings, though some expected further near-term gains.
Asian shares scaled their highest levels since August 2011 after an improving global economic outlook whetted investor appetite for risk, while the yen firmed amid doubts over Japan’s commitment to drastic reflation.