European markets slip in morning deals

European stock markets slid Monday as investors weighed the chances of more stimulus measures from the US Federal Reserve, and ahead of another busy week for the eurozone's debt crisis. London's FTSE 100 index of top companies fell 0.15 percent to 5,786.24 points in morning trade, Frankfurt's DAX 30 index dropped 0.02 percent to 7,213.67 points and in Paris the CAC 40 also reversed 0.02 percent to 3,518.42. In foreign exchange activity, the European single currency dipped to $1.2784, drifting lower after an impressive pre-weekend rally. The euro had surged to $1.2817 on Friday, hitting the highest level since May 22, after weaker-than-expected non-farm payrolls data in the United States. Global equities and the euro also rebounded last week after the European Central Bank announced it could buy unlimited amounts of debt from troubled nations like Spain and Italy in a bid to lower their borrowing costs. Investors' focus now switches to Germany's Constitutional Court, which on Wednesday is due to decide whether German President Joachim Gauck can sign into law the eurozone's key crisis-fighting tools that include the European Stability Mechanism. Other major events that will dictate investor sentiment include the US Federal Reserve's interest rate decision on Thursday and Dutch general election on Wednesday. "European markets kick off the week in a cautious manner as investors hold back from building risk exposure ahead of key events this week," said ETX Capital trader Ishaq Siddiqi. "We have the German Constitutional Court ruling on the ESM on Wednesday and the Fed meeting on Thursday, both of which are major event risks. "Germany's opposition of the ECB's bond-buying plan and the mixed data picture of the US economy prompt a huge degree of uncertainty over both events." Last Friday, the US Labor Department revealed that just 96,000 jobs were added last month, convincing many that the Fed would act in its policy meeting this Thursday with another round of bond purchases, or quantitative easing. "After last week's euphoric buying spree across global indices, markets are in respite mood this morning as they contemplate the chances of the US Federal Reserve taking similar action to the ECB by providing the world's largest economy with more stimulus," said Capital Spreads analyst Simon Denham. "There's no question that the US economy is slowing and Friday's non-farm payroll proved that once again with far fewer than expected jobs being created. "The figure of below 100,000 came as a disappointment and there were downgrades to previous employment figures." Global stock markets have rallied in recent days after ECB president Mario Draghi on Thursday unveiled a new plan which is aimed at ending the region's long-running sovereign debt crisis. "Investors believe Draghi is serious about his promise to 'do whatever it takes' to preserve euro," added GFT analyst David Morrison. "They also believe that Friday's dismal non-farms data tips the balance towards further stimulus from the FOMC this week." Asian equities traded mixed on Monday, as stimulus hopes were overshadowed by growth concerns in China and the United States, the world's two biggest economies. Hong Kong shares gained just 0.13 percent and Shanghai won 0.34 percent, while Tokyo ended flat and Seoul shed 0.25 percent. Expectations for new measures to boost growth in China were stoked after figures at the weekend showed industrial output growth weakened to 8.9 percent year-on-year in August, its slowest pace since May 2009. With the economy expanding 7.6 percent in the second quarter of 2012 -- the worst performance in three years and the sixth straight quarter of easing -- economists say the government will likely act soon. But China released more data Monday showing imports unexpectedly fell in August, with softened demand at home hitting sentiment.