Australian shares fell 0.66 per cent on Tuesday with the All Ordinaries index trading at 5378 and the S&P/ASX 200 down similar amount to 5405.

Wall Street saw a late surge to cap of a fourth straight day of gains, despite another drop in oil prices overnight.

The Dow Jones Industrial Average added 0.9 per cent to close at 17,911 and the S&P 500 gained 0.4 per cent to close at 2,079 capping  its biggest three-day rally since 2011.

• Spending takes a tumble in November
• Motorists starting to benefit from falling oil prices

Investors are obviously confident that tomorrow’s US third-quarter growth update will be in line with estimates and economists are predicting annualised growth will be revised up to 4.3 per cent for the September quarter.

On the ASX BHP Billiton was down 3.45  per cent to $28.81, Medibank Private was up 1c to $2.31, Telstra was  down 7c to $5.96 and Commonwealth Bank was down 39c  from record highs at $84.96.

The Australian dollar is  weaker trading at US81.20c and seems to be heading below US81c.

Energy stocks limited the gains on the market; as West Texas crude oil resumed its selloff and closed down at $US55.50 a barrel.

Nymex, which is the US one-month contract, was off 3.2 per cent at 8:30am (AEDT).

Brent crude was 2.1 per cent lower and Tapis had dropped sharply to $US61.30 a barrel.

The drop came after Saudi Arabia’s powerful oil minister Ali al-Naimi said OPEC would not cut production at any price.

Looking across the Atlantic, markets posted strong gains.

The Eurostoxx rose 0.5 per cent and London’s FTSE 100 also added 0.5 per cent.

Trade in the eurozone is still being buoyed by expectations that the European Central Bank will embark on quantitative easing in the new year.

Turning to currencies, and the Russian rouble saw a small recovery, rising 6 per cent, on speculation that the government is putting pressure on exporters to sell foreign exchange.

Local stocks were set to fall at the beginning of trade – the ASX SPI 200 was 0.3 per cent lower at 5,393.

The key spot iron ore price was also lower at $US68.00 US a tonne.

Gold had fallen sharply to $US1,173.81 an ounce.

Fewer Americans bought homes in November as buying slid to its slowest pace in six months.

The National Association of Realtors said on Monday that sales of existing homes fell 6.1 per cent to a seasonally adjusted annual rate of 4.93 million.

That was down from a revised annual pace of 5.26 million in October. Over the past 12 months, sales have risen 2.1 per cent.

The combination of higher home prices and relatively stagnant incomes has reduced affordability and restrained buying activity.

A recent decline in mortgage rates has yet to lure more buyers into the market. At the same time, fewer distressed properties and bargains, which tend to attract investors, are coming onto the market.

Median home prices rose 5 per cent over the past 12 months to $205,300.

With AAP