September futures on the S&P/TSX index were down 0.3% at 6:49 a.m. ET (1049 GMT).

Oil fell on signs of profit-taking after rallying in July when investors wagered on tightening global supplies. [O/R]

Base metal prices declined on weak demand outlook from top consumer China after poor economic data, while precious metals eased on a firm dollar. [MET/L] [GOL/]

Market participants will focus on S&P Global's Purchasing Managers' Index data, due at 9:30 a.m. ET, to gauge the Canadian economy's health.

The ISM Manufacturing survey, due at 10:00 a.m. ET, is expected to show that July U.S. factory activity contracted less than the month before, raising hopes of a soft landing for the American economy.

U.S. Federal Reserve Chair Jerome Powell said on Wednesday that Fed staff are no longer forecasting a U.S. recession.

The Toronto Stock Exchange's S&P/TSX composite index on Monday closed 0.5% higher at 20,626.64, its highest closing level since April 28, helped by gains in materials.

Canadian oil producer Strathcona Resources said on Tuesday it would go public by acquiring smaller rival Pipestone Energy in an all-stock deal that would value the combined business at C$8.6 billion ($6.49 billion).

A dock workers' union on Canada's West Coast and port employers have provisionally agreed to a new labour contract, averting an immediate strike, diminishing worries of supply-chain constraints and inflation.

A bunch of Canada's energy and real estate companies are set to report quarterly earnings later in the day.

COMMODITIES AT 6:49 a.m. ET

Gold futures: $1,963.3; -0.8% [GOL/]

US crude: $81.23; -0.7% [O/R]

Brent crude: $84.92; -0.6% [O/R]

($1= C$1.3266)

(Reporting by Siddarth S in Bengaluru; Editing by Shilpi Majumdar)