The Australian stock market looks set to open higher after strong performance on overseas markets overnight.

At 0654 AEDT on Wednesday, the March share price index futures contract was UP 22 points at 5,317.

German economic data out overnight showed that the unemployment rate held steady at 6.9 per cent in December, while retail spending increased by 1.5 per cent in November.

In the US, the November international trade report said the trade deficit shrank sharply in the month, to be at its smallest point in four years.

In Australia on Wednesday the Australian Bureau of Statistics will release job vacancies for November and the Australian Industry Group will release its performance of construction index (PCI) for December.

The stock market on Tuesday finished in the red, weighed down by poorly performing resources stocks.

The benchmark S&P/ASX200 index lost down 7.9 points, or 0.15 per cent, at 5,317.0.

The broader All Ordinaries index lost 8.9 points, or 0.17 per cent, at 5,318.8.