Opening Losses Likely for Markets

LONDON -- The Dow Jones Industrial Average (INDEX: ^DJI) and the S&P 500 (INDEX: ^GSPC) are expected to open down slightly this morning, according to futures markets, as last week's rally pauses while investors assess the latest economic data. Since last week's ECB bond-buying announcement, CNN's Fear & Greed Index has surged to 83, the highest level seen since the beginning of this year and close to its all-time record.

Markets are now waiting for the next round of key decisions. On Wednesday, a German court will rule on the legality of the proposed European bailout fund, the European Stability Mechanism. A negative verdict could heavily impact the stability of the single currency, while on Thursday, the Federal Reserve may announce further stimulus measures after its monthly meeting.

In the meantime, disappointing Chinese data may dampen markets' enthusiasm; new data overnight showed that imports fell by 2.6% in August, missing an expected 3.5% increase. China's exports were also disappointing, growing by just 2.7% compared with a 3% gain forecast by a Reuters poll. Closer to home, July's consumer credit figures are due to be published at 3 p.m. EDT and are expected to show an increase to $7 billion from $6.5 billion in June.

Companies that may feature heavily in trading today include AIG, following the U.S. Treasury's announcement that it intends to sell as much as $18 billion of shares in the company, reducing taxpayers' stake in the firm to less than 50%. Clothing firm Michael Kors could be active after announcing a secondary offering on Friday. Companies releasing results today include Casey's General Stores and Five Below.

European markets
European markets have been quiet this morning, after last week's strong gains. At 7am, the DAX was up 0.1%, the CAC was down 0.1%, the FTSE MIB was down 0.4% and the IBEX was down 0.5%.

In London, mining shares rose strongly, led by Fresnillo, which gained 4%. However, the FTSE 100 (INDEX: ^FTSE) was unchanged at 7 a.m. EDT, with gains in commodity stocks balanced by losses for consumer goods stocks including SABMiller and British American Tobacco. Shares in Glencore fell 1.2% following the company's updated takeover offer for Xstrata, which saw its share price rise by a further 2.4% through the morning.

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