UNITED KINGDOM

U.S. stock index futures pointed to a 1 percent drop at the open on Tuesday as poor results from Swiss lender UBS and a shake-up in British banks weighed on investor sentiment ahead of the start of a two-day Fed meeting.

European stocks fell sharply to a new one-month low on Tuesday, with banks suffering after poor results from UBS (UBSN.VX) and a shake-up of the UK retail banking sector.

European shares extended losses on Tuesday morning, with banks the biggest fallers after disappointing results from UBS (UBSN.VX) and a shake-up of UK banks.

Britain's FTSE 100 .FTSE fell below the 5,000 level for the first time in a month on Tuesday, while European stocks also extended losses, weighed by weakness in banks and miners.

Britain's two largest retail lenders have agreed to a massive shake-up of the banking sector that will see both sell hundreds of branches and key businesses to appease EU concerns over state aid and competition.

Britain's two largest retail lenders have agreed to a massive shake-up of the banking sector that will see both sell hundreds of branches and key businesses to appease EU concerns over state aid and competition.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

World stocks dipped toward the previous session's four-week lows on Tuesday as investors continued to fret over the early removal of government stimulus, particularly in the financial sector.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

Lloyds Banking Group launched a record 13.5 billion pound ($22 billion) rights issue and along with rival Royal Bank of Scotland agreed to sell off some businesses to limit their reliance on government support.

Kraft Foods Inc will need to show progress in cutting costs and improving organic revenue when it reports earnings on Tuesday, in a bid to convince Cadbury shareholders it is a viable deal partner.

Britain is set to announce on Tuesday a long-awaited deal with its bailed-out banks, including a record rights issue for Lloyds Banking Group and hefty disposals for Royal Bank of Scotland to appease the EU competition regulator and boost competition.

The Australian Dollar opens at 0.9022 after a volatile session on Monday. With local equities opening in negative territory the Aussie fell in quick fashion down to an intraday low of US89 cents.

U.S. manufacturing activity hit its highest level in 3-1/2 years last month and pending home sales contracts unexpectedly surged in September, allaying fears the economy's budding recovery would falter.

Ford Motor Co posted a quarterly profit on Monday, defying Wall Street forecasts for a loss as it cut costs and gained market share, leading it to raise its 2011 outlook to solidly profitable from break-even.

U.S. stocks rose on Monday as stronger-than-expected data on manufacturing and pending home sales spurred broad-based gains following a sell-off at the end of last week.

A deal between Royal Bank of Scotland, EU regulators and the UK government could include unplanned disposals, the bank said for the first time on Monday, ahead of a radical shake-up of the UK banking sector.

Elton John is recovering in hospital from a serious case of e-coli bacterial infection and influenza that forced him to cancel a string of concerts, but he hoped to return to the stage soon, a spokesman said on Monday.