The US National Association of Home Builders sentiment index eased from +15 to +14 In September, below forecasts for a steady result.

US President Barack Obama has unveiled a plan to slash $3 trillion from the budget deficit over 10 years.

The European Union, International Monetary Fund and European Central Bank (troika) held a teleconference with the Greek Finance minister to consider further bail-out payments to Greece. The troika will hold another meeting on Tuesday.

European shares slumped on Monday after European finance ministers failed to come up with new plans to deal with the debt crisis. Banks were hardest hit with the STOXX Europe 600 Banks index down 3.4pct. The FTSEurofirst index lost 2.3pct while the German Dax fell by 2.8pct and the UK FTSE lost 2.0pct.

US sharemarkets recovered from steep losses in the final 45 minutes of trade on speculation that the troika were near a deal on further bail-out payments to Greece. The Dow Jones ended trade lower by 108pts or 0.9pct after being down over 250 points at one stage. The S&P 500 was lower by 1.0pct while the Nasdaq lost 9.5pts or 0.4pct.

US treasuries rose on Monday (yields lower) on Euro-zone debt worries and weaker equities markets. US 2yr yields fell by 2pts to 0.157pct and US 10yr yields fell by 9pts to 1.958pct.

Major currencies were volatile against the US dollar in European and US trade on Monday. The Euro fell from near US$1.3705 to US$1.3585 in European trade before clawing back losses and ending the US session near US$1.3685. The Aussie dollar fell from highs around US102.65c to US101.65c in European trade, before ending US trade near US102.20c. And the Japanese yen lifted from 76.95 yen per US dollar to JPY76.35 before easing in US trade to end near JPY76.55.

Global crude oil prices fell again on Monday as investors fretted about the economic fall-out from the euro zone debt crisis. Nymex crude oil fell by US$2.26 or 2.6pct to US$85.70 a barrel and London Brent crude fell by US$3.08 to US$109.14 a barrel.

Base metal prices fell between 1.7-3.8pct on the London Metal Exchange on Monday in response to a firmer greenback and fears that the on-going European debt crisis will crimp world economic growth. And the gold price also eased as investors booked profits to cover losses in other markets. The Comex December gold price was lower by US$30.40 an ounce or 1.7pct to US$1,784.30.

Ahead: In Australia, minutes from the last Reserve Bank Board meeting are released. ABARES releases commodity forecasts. In the US, the Federal Reserve begins a two-day meeting. Weekly chain store sales data and figures on housing starts are released.