LONDON (ShareCast) - US equities have opened the session moderately lower on what is a half day of trading ahead of the Christmas break; markets will shut at 13:00 (New York time).
Lawmakers in the US have voiced concerns that the country will fall off the 'fiscal cliff' in nine days as it is yet to reach a budget deal that would prevent considerable spending cuts and tax hikes.
Leaders have fuelled fears that they won't meet the January 1st deadline following reports that President Obama and opposition leader John Boehner are not talking and are out of town for the Christmas holidays.
Last week Boehner was unable to gain the backing of his fellow Republicans on the so-called 'Plan B' package, which had been put forward to increase tax to raise over $1.0m each year.
Leaders are currently say there is still time to strike a deal but admitted that time is limited.
It has been revealed that social networking site Facebook (NasdaqGS: FB - news) paid just £2.9m in tax on non-US profits of £840m through specific accounting techniques. All of the company's non-US generated profits are directed through Facebook Ireland and the figures show as a result of an accounting technique known as the 'Double Irish', meaning the company could transfer signifcant sums of money to other subsidiaries via royalty payments.
In pre-market trading today, Alexza Pharmaceuticals (NasdaqGM: ALXA - news) shares settled back down after it announced on Friday that one of its drug treatments for mental health disorders was approved by the Food and Drug Administration.
HLF Herbalife was also a big faller after Pershing Square Capital Management hedge-fund manager Bill Ackman announced that he had taken a huge short position in the shares.
Retailers appear to be suffering in the glare of the looming fiscal cliff with shoppers reluctant to spend as much as usual ahead of Christmas. Accoring to ShopperTrak, sales growth in the week ended December 15th was around four per cent lower than that seen in the same period the previous year.
UK and European markets ended their half-day session modestly higher, with London-listed miners putting in a decent performance throughout the morning.
Italian Prime Minister Mario Monti has declared he would consider being a candidate for a coalition backing his economic agenda. However he said he won't run in the country's elections in February.
Meanwhile, opponents have accused Egyptian President Mohamed Mursi of potentially ruining his chances of saving the country's wailing economy by fast-tracking the constitution through to a referendum.
The opposition said he lost the vote from people concerned by the text that was drafted by an Islamist-dominated assembly. The government will find it more difficult to implement reforms in securing a $4.8bn loan from the International Monetary Fund without broader support.
Front month West Texas Intermediate crude futures fell by 0.18% to $88.50 a barrel in NYMEX trading.
10-year US Treasury bond yields are now up by one basis point at the 1.78% level.