Royal Bank of Scotland advanced 1% on news that it is set to sell its Southern Water unit for around 4 billion pounds. Reuters Group bucked the downtrend in the media sector and was up 0.9%, after the financial information company was taken over by Thomson Corp of Canada three weeks ago.

Decliners

After Rupert Murdoch approach for the Wall Street Journal, anticipation of a fierce competition weighed on the business publishing stock, sending them lower. Pearson lost 1% and Reed Elsevier, which owns business information services both in Europe and the U.S. dipped 1.3%.

GlaxoSmithKline declined 1.1% as there are still concerns over possible health risks in its Avandia diabetes drug. Whitbread, another decliner, was 0.4% lower despite unveiling the sale of its David Lloyd health club chain to the London & Regional property company.

Segro, known before as Slough Estates, erased early morning gains and was trading down 0.1% after it confirmed the 1.5 billion pounds disposal of its US property concerns. It promised to return 250 million pounds of the proceeds to investors through a special dividend.


9:00AM U.S. stock futures pointed lower amid steep Shanghai drop.

U.S. stock futures pointed lower on Monday as investors digested another steep decline in Chinese stock prices. Although Shanghai plunged 8%, global markets were not seriously hurt.

In corporate news, a number of merger deals were announced early Monday. Real-estate investment trust Health Care Property Investors (HCP: chart) agreed Monday to buy Slough Estates USA from the U.K.''s Segro Plc for $2.9 billion, including the assumption of about $1.2 billion in debt.

In another deal, contract electronics manufacturer Flextronics International (FLEX: chart) said it will buy contract electronics maker Solectron (SLR: chart) in a cash-and-stock deal worth about $3.6 billion. Solectron will become a subsidiary of Flextronics, with Solectron shareholders holding a stake of between 20% to 26%. Flextronics expects the deal to add at least 15% to its earnings. The deal is expected to close by the end of the year with the approval of shareholders and regulators.

Among other companies in focus, Wal-Mart (WMT: chart) rose 2% in pre-open trading, following upgrades from J.P. Morgan and Morgan Stanley. Onyx (ONXX: chart) climbed 9% amid reports of improved survival from patients taking a liver cancer drug. Dow Jones industrial futures expiring in June fell 36, or 0.26%, to 13,653. Standard & Poor''s 500 index futures fell 5.60, or 0.36%, to 1,534.00. Nasdaq 100 index futures declined 9.00, or 0.47%, to 1,923.25.


8:30AM Asian markets mostly rise Monday with China bucking the uptrend and declining.

Asian markets mostly advanced on Monday. The Shanghai Composite Index plunged for a second session, off 8.3% to 3,670.40. The Chinese government last week lifted a tax on stock trading trying to restrict a market boom that is thought it could create a dangerous price bubble. In Japan, Nikkei 225 index advanced 14.54 points, or 0.08%, to settle at 17,973.42, the highest finish since Feb. 27. Toyota was among the gainers, advancing 1.21%.

Elsewhere around the region, the benchmark in Hong Kong, the Hang Seng Index gained 0.62% to settle at 20,729.59, while the Korea Composite Stock Price Index, or Kospi, added 1.2% to 1,737.59, which is a record high. The Weighted Price Index of the Taiwan Stock Exchange advanced 0.5% to end at 8,294.79 and the Australian benchmark S&P/ASX 200 index finished up 0.9% at 6,392.9, after striking a record intraday high of 6,409.2 in early session.


8:00AM Dominion agreed to sell most of its natural gas and oil exploration and production operations for $6.5 B.

Energy and power producer Dominion (D: chart) announced Monday an agreement to sell the biggest part of its U.S. onshore natural gas and oil exploration and production operations in two separate transactions for a total of about $6.5 billion.

Dominion''s Permian Basin operations will be bought by Loews Corp. (LTR: chart) for $4.025 billion, while Dominion''s operations in the Rocky Mountains will be taken over by XTO Energy (XTO: chart) for $2.5 billion.

The operations include 3.51 trillion cubic feet equivalent of proved natural gas and oil reserves as of Dec. 31, 2006. XTO said in a statement that it is planning to set up a $500 million limited partnership.