European stocks were called to open lower on Monday tracking Asia overnight as fears persist over the ability of European leaders to resolve the debt crisis in the euro zone and how to tackle funding difficulties for European banks.
The FTSE is called 44 points lower, the DAX in Frankfurt is expected to open down by 48 points and the CAC 40 is called lower by 28 points.
A devastating election defeat for Spain's Socialist party by the center-right People's Party headed by Mariano Rajoy will raise hopes for reforms in the heavily indebted Iberian country.
Rajoy is expected to enact widespread economic reforms and he warned Spaniards that "difficult times are coming" in his victory speech on Sunday.
With 90 percent of the votes counted, the Popular Party won 186 seats compared to 154 in the last legislature, while the Socialists won just 110 seats, down from 169, amounting to their worst election defeat ever.
Chinese Vice Premier Wang Qishan warned over the weekend that the world faced a "chronic" economic recession if nations failed to get to grips with debt and the situation in the euro zone is not resolved quickly.
His comments are the most bearish yet by a Chinese leader and he stressed that China must concentrate on stimulating further domestic growth.
A Reuters report on Sunday claimed that the US Congress bi-partisan "super committee" set up to agree a $12 trillion deficit reduction plan will announce on Monday that it has failed.
News of the failure has been anticipated all weekend, but the announcement is likely to unsettle investors already very concerned about the crisis in the euro zone.
Greek Prime Minister Lucas Papademos travelled to Brussels on Sunday in an effort to secure the next tranche of bailout aid from the so-called 'Troika' of the IMF, EU and European Central Bank.
Papademos will attempt to convince European and IMF officials that Greece should receive the 8 billion euros it needs to avoid a default in December, but New Democracy party leader Antonis Samaras is still refusing to sign a guarantee that he will honor the conditions of the bailout agreement.
Italian Prime Minister-delegate Mario Monti will meet with European Union leaders later this week to discuss Italy's budget plans and how he intends to go about driving down the nation's deficit.
Monti will travel to Brussels on Tuesday to meet with European Council President Herman Van Rompuy and President of the European Commission, Jose Manual Barroso.
On Thursday, Monti will meet with French President Nicolas Sarkozy and German Chancellor Angela Merkel in Strasbourg.
A 7 billion euro French Treasury bill auction will take place on Monday, with results expected around 1:50pm London time.
In the UK, the Confederation of British Industry will begin its annual conference, with Goldman Sachs Asset Management Chairman Jim O'Neill and Fiat Chrysler Chief Executive Sergio Marchionne expected to deliver speeches.
Three aides to former Italian Prime Minister Silvio Berlusconi will go on trial on Monday, accused of recruiting several young women for prostitution.