US pending homes sales rose by 4.3pct in August after a 4.5pct lift in July and ahead of expectations for a 3pct gain. Also factory orders fell by 0.5pct in August, largely in line with expectations. Excluding transport, factory orders rose by 0.9pct.

US Federal Reserve chairman Ben Bernanke said that the US Government´s financial bail-out program - the Troubled Asset Relief Program (TARP) - was turning out to be a ´´pretty good investment´´.

European shares fell for the sixth straight day on Monday with weakness in oil and metal prices weighing on resource company shares. In London trade BHP Billiton and Rio Tinto shares both fell by 1.5pct. The FTSEurofirst index fell by 0.6pct, with the UK FTSE lower by 0.7pct and the German Dax was down by 1.2pct.

US sharemarkets eased on Monday with lower commodity prices weighing on energy and mining shares. Shares in Microsoft lost 1.9pct following an earnings downgrade. And investors also focussed on negative technical indicators for the broader S&P 500 index. At the close, the Dow Jones was lower by 78pts or 0.7pct with the S&P 500 down 0.8pct and the Nasdaq eased by 26pts or 1.1pct.

US treasuries lifted modestly on Monday (yields lower) as commodity prices and equity markets softened, causing investors to drift to government bonds. US 2yr yields eased by 2pts to 0.41pct and US 10yr yields fell by 4pts to near 2.479pct.

The Euro and commodity currencies eased against the greenback in European and US trade on Monday. The Euro fell from highs near US$1.3785 to US$1.3665, ending US trade near US$1.3685. The Aussie dollar gravitated between US96.50c to US97.05c, closing US trade near US96.80c. And the Japanese yen lifted from 83.60 yen per US dollar to near JPY83.15, ending US trade around JPY83.40.

US crude oil prices ended little changed on Monday, consolidating after the strong gains recorded over the past week. While a firmer dollar put downward pressure on oil prices, this was offset by supply concerns as a strike in France extended to its eighth day and a barge accident delayed shipping in the Houston Ship Channel. The Nymex crude oil contract fell by US11c to US$81.47 after trading as high as US$82.38 a barrel. London Brent crude fell by US31c to US$83.44 a barrel.

Base metal prices were mixed on the London Metal Exchange on Monday. Nickel rose 1.1pct and aluminium rose 0.1pct but other metals eased between 0.1-0.9pct. And the Comex gold price eased in line with other commodities, dropping by US$1.70 an ounce to US$1,316.10.

Ahead: In Australia, the Reserve Bank hands down the interest rate decision. Retail trade, job ads, car sales, trade and the Performance of Services index are released. In the US the ISM services index is released.