European shares .FTEU3 rose 0.5 percent in early trade, reversing the previous session's dip, as hopes Spain will request a bailout eclipsed investors' worries about the corporate earnings season.

Spain could ask for financial aid from the euro zone next month and if it does the request would likely be dealt with alongside a revised loan program for Greece and a bailout for Cyprus in one big package, euro zone officials said.

The Commerce Department releases retail sales figures for September at 8.30 a.m. EDT. Economists expect a 0.8 percent rise, compared with a 0.9 percent increase in August.

Amazon.com Inc (AMZN.O), the world's largest Internet retailer, is in advanced talks to buy the mobile chip business of Texas Instruments (TXN.O), Israeli financial newspaper Calcalist reported on Monday.

New York Federal Reserve releases its Empire State Manufacturing Survey for October at 8.30 a.m. EDT. Economists expect a reading of -4.55, compared with -10.41 in September.

Citigroup Inc (C.N) announces results on Monday after earnings reports from JPMorgan Chase & Co (JPM.N) and Wells Fargo & Co (WFC.N) sparked concern about shrinking profit margins for big lenders despite both reporting stronger-than-expected profits. That led U.S. stocks to wrap up their worst week in four months on Friday.

The Commerce Department issues Business Inventories figures for August at 10.00 a.m. EDT. Economists expect a rise of 0.5 percent, versus a 0.8 percent gain in the prior month.

Shares in Italy's Fiat Industrial (FI.MI) fell 0.7 percent on Monday after its U.S. unit CNH (CNH.N) said it rejected the terms of a proposed merger between the two companies.

Sales growth in the global luxury market will slow this year to 5 percent from 13 percent in 2011 at constant exchange rates as Chinese customers rein in their spending and concerns about the global economy take their toll, a study by Bain & Co together with Italian luxury goods trade body Altagamma said.

Benign inflation in September showed China has scope to ease policy even as evidence mounts that earlier pro-growth measures are gaining traction, reducing the pressure on policymakers to act as a once-a-decade leadership transition approaches.

The Dow Jones industrial average .DJI edged up 2.46 points, or 0.02 percent, to 13,328.85 at the close. But the S&P 500 .SPX fell 4.25 points, or 0.30 percent, to finish at 1,428.59. The Nasdaq Composite .IXIC dipped 5.30 points, or 0.17 percent, to 3,044.11.

(Reporting by Atul Prakash; editing by Patrick Graham)

• A Permanent Economic Emergency