A state of anxiety and tensions dominates trading at the beginning of the week on mounting expectations the U.S. congress will fail to agree on the procedures needed to cut the budget deficit, where investor's fears did not calm down after the win of the right-wing party in Spain in the general elections as Papademos and Super Mario visit Brussels.

The Conservative Popular party won in the Spanish Parliamentary elections with 186 seats versus 111 seats for the Socialist party.

Mariano Rajoy, the leader of the Popular right-wing Party who will head the government starting from December 20, pledged to do intensified efforts to face the debt crisis but he stated that miracles will not happen, referring to the difficult situation in Spain due to the rise in unemployment to the highest level in the euro region and the global slowdown.

Moreover, the newly appointed Greek Prime Minister Lucas Papademos will visit Brussels, the headquarter of the European Commission, to secure the next bailouts required to avoid a possible default of his country.

Papademos is currently facing daunting challenges including the rejection of Samaras, the leader of the democratic partly in the new government, to sign written guarantees for the EU and IMF to receive the needed bailout package.

Papademos is trying to convince international lenders to deliver his country the sixth tranche of last year's bailout to avoid Greek default, where Athens has to sign guarantees to receive this installment, when he meets with Jose Manuel Barroso and Van Roumpy then he has to travel to Luxembourg to meet with Jean-Claude Junker in the next day.

Moving to Italy, the new Prime Minister Mario Monti got the approval of both lower and upper houses on his government last week, where the new government will focus on the implementation of austerity measures which aims to cut the budget deficit.

Monti will also meet with Van Roumpy and Barroso today before he goes to France to meet with the French President Nicolas Sarkozy and German Chancellor Angela Merkel.

Currently, the euro is trading around within narrow ranges versus the U.S. dollar amid expected volatility with lack of important fundamentals. The pair opened trading at 1.3592 recording the highest level at 1.3537 and the lowest level at 1.3469 while it currently hovering around 1.3475.