Premarket: TSX heading for losses

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North American stock markets appear set for a lower opening as the last week of the third quarter gets underway. The rally that brought the S&P 500 up about 7 per cent over the last three months is looking rather tired and vulnerable to a pullback, and some fund managers may book profits after the strong quarter. Weakness in commodity prices this morning also points to a tough day for the TSX.

News overnight wasn't very encouraging. German business sentiment unexpectedly dropped for a fifth successive month in September to its lowest level since early 2010. Germany has been the strongest of European economies and the decline in the face of the European Central Bank's recently announced bond-buying plan points to a still shaky outlook for the region. In the meantime, the market is awaiting news this week about a potential rescue plan for Spain.

In Asia, a survey by New York-based research CBB International found that Chinese manufacturers and retailers are less optimistic about sales than they were three months ago and are cutting jobs.

Here's the rundown of what else you need to know as the investing day gets underway.

MARKETS:

Equities:
Futures: Dow -0.3 per cent, S&P 500 -0.3 per cent, Nasdaq -0.3 per cent

Hong Kong's Hang Seng index -0.19 per cent

Shanghai Composite index +0.31 per cent

Japan's Nikkei -0.45 per cent

London's FTSE 100 -0.59 per cent

France's CAC 40 -1.18 per cent

Germany's DAX index -0.64 per cent

Commodities:
WTI (Nymex Nov) -1.30 per cent at $91.68 (U.S.) a barrel

Gold (Comex Dec) -1.03 per cent at $1,759.70 (U.S.) an ounce

Copper (Comex Dec) -1.44 per cent at $3.73 (U.S.) a pound

Currencies:
Canadian dollar down 0.0038, or 0.37 per cent, at $1.0193 (U.S.)

STOCKS AND ECONOMIC INDICATORS TO WATCH:

RIM is down 1.6 per cent in the premarket, showing little sign of recovering after its 7.4 per cent drop on Friday in the wake of more BlackBerry outages.

Apple is down 2 per cent in the premarket as the company says it's sold more than 5 million iPhone 5s over the opening weekend. That was lower than some analysts were expecting.

Facebook shares are down 5 per cent in the premarket after a Barron's analysis found the stock is only worth $15 (see link under top web reads below).

Tivo shares jumped 8 per cent in the premarket after announcing it settled a patent dispute with Verizon. Tivo will receive at least $250.4-million in compensation.

AK Steel Holding Corp. is down 4.3 per cent in the premarket after Citigroup downgraded the stock to "sell" from "neutral."

Among companies reporting earnings is Hanfeng Evergreen Inc.

THIS MORNING'S TOP READS ON THE WEB:

Excessive optimism tends to occur in the latter parts of a rally and, right now, most indicators are pointing towards excessive optimism.

Goldman Sachs sees shifting tax conditions in 2013 leading to "a wave of special dividend announcements" in the near future amid a "perfect alchemy to reward shareholders."

Facebook's 40 per cent plunge from its initial public offering price of $38 (U.S.) in May has millions of investors asking a single question: Is the stock a buy? According to Barron's, the short answer is "no."

With revenue streams drying up and fewer places to cut costs, corporate America's outlook for third-quarter earnings is looking grim.

The market has been eating up Warren Buffett's bearish comments on munis. What will the market do with PIMCO increasingly becoming a municipal bond bull?

Four keys to successful long-term investing.

The New York Times on why Apple's best days may soon be behind it.

With the global economy slowing and the U.S. dollar strengthening it may now be time to invest in companies more tied to the U.S. economy, some market pros are saying.