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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.

Billionaire investor Warren Buffett rarely invests outside the U.S. However, he did recently invest $1 billion in a well-known British blue -chip brand, expanding his stake in the company to more than 5%. This famous British name has global expansion potential -- and you can discover the identity of the company and the price he paid in this special exclusive report. Best of all, the report is free -- so download it today while it's still available.

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Roland Head has no shares in any of the companies mentioned in this article. Motley Fool newsletter services have recommended buying shares of American International Group. The Motley Fool has a disclosure policy.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Read/Post Comments (2) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 10, 2012, at 9:42 AM, WineHouse wrote:

    I hope readers know that Buffett's stock holdings are public knowledge, since he has to report every quarter and there are several websites that pre-chew the information and put it into easy to use format for free. All you need to do is Google it to get the list. Based on his quarterly reporting, I would guess that this big secret UK holding just might be a big UK pharmaceuticals company.

  • Report this Comment On September 10, 2012, at 9:52 AM, WineHouse wrote:

    My apologies, folks. Even though Buffett owns plenty of GSK, that's not the UK company MF is referring to here. It's Tesco. I just read another Motley Fool article (about investing in UK stocks) and found this quote in the article itself:

    "By the way, one American investor who has bought British of late is Warren Buffett. The CEO of Berkshire Hathaway has spent more than $1 billion buying the shares of Tesco (OTC: TSCDY), Britain's largest supermarket chain and an FTSE 100 favorite among ordinary British investors. You can read all about Buffett's purchase in this free report: "The One UK Share That Warren Buffett Loves." "

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