Asian shares fell on Monday as risk sentiment was dented by lackluster earnings from leading US companies, and a bigger than expected fall in exports from Japan, a key driver of the world's third-biggest economy. The MSCI Asia Pacific was 0.29% lower at midday in Hong Kong. Japan's exports fell 10.3% in September from a year earlier, the biggest drop since the tsunami disaster in March last year, and the fourth consecutive month of decline. This left a trade deficit of 558.6bn yen ($7bn), compared with economists" expectations of 547.9bn yen. Germany to warn UK on budget veto: "Germany is planning to warn Britain that it will seek to cancel next month's European budget summit if David Cameron, the prime minister, insists that he will veto any deal other than a total freeze on spending. Merkel wants Cameron to back a German compromise that would cap spending growth at 1% of European GDP. Spain's regional elections provided a boost for Prime Minister Mariano Rajoy as he pushes through unpopular spending cuts. Rajoy's Popular party increased its absolute majority in Galicia at the weekend. However at elections in the Basque Country, nationalist and separatist parties won more than 50 of the 75 seats, as had been widely forecast, and the Popular party lost three seats to take 10. San Miguel is pursuing a $5bn acquisition, its president Ramon Ang said on Saturday. He said San Miguel was competing against two other bidders, but declined to identify the target company or the industry. The Philippines" largest company "has diversified from food and drinks to industries including oil, power and infrastructure to meet a goal of doubling sales." ADM bids for GrainCorp: "GrainCorp, the agricultural company that stores and moves a third of Australia's wheat crop, saw its shares rise by more than 40 per cent on Monday after Archer Daniels Midland tabled a A$2.7bn (US$2.8bn) cash offer." RBS pressured to sell Citizens: The majority-public owned UK bank is under pressure from government officials and the FSA to sell Citizens Financial Group, a US . RBS bought a controlling stake in Citizens for $440m in 1988, and Citi analysts now believe it could now be worth £6.6bn. FSA Director Andrew Bailey sent a letter to Stephen Hester, the chief executive at RBS, saying the bank could exit the insurance program but should consider selling Citizens to strengthen its capital position, according to people familiar with the letter. TNK-BP sale a game changer: "BP is aiming to announce Monday a preliminary agreement to sell its 50% stake in the lucrative but problematic Russian oil venture TNK-BP" to Rosneft, according to people familiar with the matter. The transaction, which must still be approved by the Russian government, will leave BP with a stake of at least 19% in Rosneft, making it the second largest shareholder in the company after the Russian state. Canada rejected a $5.21bn bid by Malaysia's state-owned Petronas for Progress Energy Resources. The Canadian government's surprise decision was announced in a short statement late Friday by industry minister Christian Paradis, who declined to elaborate further over the weekend. Investors had expected the bid would be approved. Mick Davis defends Xstrata board: "Unfairly disparaged" over management retention payments, says the CEO. The FSA is requiring UK banks to hold "Pillar 2′ capital buffers eight times their pre-crisis size, says the regulator's executive in charge of supervising banks. The banks must now hold a total of £150bn compared to £20bn before the crisis. That is on top of £186bn required by the Basel global bank safety rules. Wolfgang Munchau: Banking union won't be quick and won't apply to Spain's existing bank recaps. Gavyn Davies looks at who's right about fiscal multipliers. Tracy Alloway reads Greg Smith's Goldman Sachs tell-all. Currency wars lead to tumbleweeds in FX markets. All eyes are on Caterpiller and its peers this week. Stacking money the right way. Asian markets Nikkei 225 down -27.93 (-0.31%) at 8,975 Topix down -1.80 (-0.24%) at 752.59 Hang Seng up +16.61 (+0.08%) at 21,568 US markets S&P 500 down -24.15 (-1.66%) at 1,433 DJIA down -205.43 (-1.52%) at 13,344 Nasdaq down -67.25 (-2.19%) at 3,006 European markets Eurofirst 300 down -8.71 (-0.78%) at 1,112 FTSE100 down -20.90 (-0.35%) at 5,896 CAC 40 down -30.62 (-0.87%) at 3,505 Dax down -56.59 (-0.76%) at 7,381 Currencies €/$ 1.30 (1.30) $/¥ 79.33 (79.33) £/$ 1.60 (1.60) Commodities ($) Brent Crude (ICE) up +0.31 at 110.45 Light Crude (Nymex) up +0.26 at 90.31 100 Oz Gold (Comex) down -7.80 at 1,715 Copper (Comex) unchanged 0.00 at 364.85 10-year government bond yields (%) US 1.77 UK 1.88 Germany 1.60 CDS (closing levels) Markit iTraxx SovX Western Europe -1.56bps at 107.82bp Markit iTraxx Europe +3.23bps at 121.62bp Markit iTraxx Xover +13.78bps at 496.06bp Markit CDX IG +2.62bps at 93.62bp Weekend headlines from the FT and other UK media:* From The FT, Argos set to step up store closures Hammerson in £254 million Junction Fund deal From The Sunday Times, BP strikes landmark Kremlin deal Goldman Sachs expects to receive a £13 million tax rebate just months after a row blew up over a "sweetheart deal" between the bank and HM Revenue & Customs Apax, KKR, Carlyle and CVC are studying a bid for Urenco From The Sunday Telegraph, Top Facebook executive Joanna Shields resigns to head up London's Tech City Ed Miliband to demand FSA acts faster on missold swaps Heathrow expansion is only "affordable" option, says Virgin Atlantic Chief National Grid investors brace for cut in dividend Amazon weighs bid for online fashion retailer Asos The Questor Column: Bank Britvic gains after short-term trade: Questor says "Sell" Go-Ahead bus plans should underpin dividend: Questor says "Buy" From The Independent on Sunday, The UK is still on course for its slowest recovery in a century despite official figures set to confirm the nation has pulled out of a double-dip recession this week Autumnal weather will provide a boost to Debenhams" full year results Longchamp is to open a large store in London's Regent Street as part of the French luxury group's global expansion plans FSA fines Bank of Scotland over IT troubles From The Guardian, EU summit leaves controversial issues untouched Olympics effect expected to lift UK out of recession From The Mail on Sunday, African Barrick Gold Plc: HSBC maintained its "Overweight" rating on the stock, with a target price of 710.00p Ferrexpo Plc: Jefferies maintained its rating on the stock to "Buy," with a target price of 300.00p Drax Group Plc: HSBC downgraded its rating on the stock to "Neutral" and with a target price to 580.00p Keller Group Plc: Jefferies initiated a "Buy" rating on the stock, with a target price of 651.00p Lloyds Banking Group Plc: JPMorgan downgraded its rating on the stock to "Underweight" and lowered its target price to 38.00p Burberry Group Plc: Investec upgraded its rating on the stock to "Buy" and kept its target price at 1300.00p From The Daily Express, American department store Bloomingdale's is considering setting up shop in London Hard-pressed households face a winter of misery, as energy suppliers have begun hiking prices Lloyds and RBS in the red as PPI bills grow Source: ETX Capital, Financial Times