TOP STORIES 
 
U.S. CONSUMER SPENDING FALLS 

Household spending fell in July, a sign cautious consumers could hold back economic growth. Personal spending fell a seasonally adjusted 0.1%. Personal income rose 0.2%. Economists expected spending would rise 0.1% and income would rise 0.3%.

 
PUTIN LASHES OUT AT UKRAINE OVER FAILURE OF TALKS 
 

Russian President Vladimir Putin accused Kiev and its allies of backing peace talks only as a smoke-screen to allow Ukraine to continue military operations, sidestepping accusations that Russia is funneling troops into Ukraine to fight alongside separatist rebels.

 
LEW TO SPEAK ON TAX REFORM, INVERSIONS 
 

Treasury Secretary Jacob Lew is planning a Sept. 8 speech about a controversial corporate strategy known as tax inversions, suggesting that the White House could be progressing in its effort to upend the practices.

 
U.S. STOCKS EDGE BACK UP 
 

U.S. stocks rose, with the Dow industrials on pace to cap their biggest monthly gain since February. Traders said the level of activity was low -- in line with the market's recent summer lull.

 
U.S. SENTIMENT INDEX IMPROVES 
 

The Thomson-Reuters/University of Michigan final-August sentiment index rose to 82.5 from a preliminary reading of 79.2 and the final July reading of 81.8. The latest reading was above the 80.2 expected by economists.

 
CHICAGO PMI JUMPS IN AUGUST 
 

The Chicago Business Barometer, commonly called the Chicago PMI, rose 11.7 points in August to 64.3, regaining all the ground lost in July, driven by a surge in production and new orders.

 
J&J, BAYER AIM TO EXPAND XARELTO'S USES 
 

Johnson & Johnson and Bayer announced plans to launch clinical trials of the anticoagulant Xarelto against three new diseases in an ambitious bid to widen the market for a drug poised to exceed $1 billion in sales this year.

 
SPRINT TO SELL NEXT SONY XPERIA PHONE IN U.S. 
 

Sprint will sell Sony's next Xperia handset in the U.S. as part of a strategy to broaden its lineup of smartphone offerings to limit customer flight, a person familiar with the matter said.

 
IMF APPROVES BAILOUT PAYMENT TO UKRAINE 
 

The International Monetary Fund approved the latest payment to Ukraine in its $17 billion bailout program, providing a critical boost to Kiev as it faces military, economic and political threats.

 
OIL RISES ON UKRAINE VIOLENCE 
 

Oil prices rose as tensions in Ukraine continued to rise and leaders in the U.S. and Europe said they would consider new sanctions against Russia's economy.

 
RUSSIA SHUTS 12 MCDONALD'S RESTAURANTS 
 

The number of McDonald's restaurants shut down by Russia's consumer regulator continues to rise as tensions between Moscow and the West grow after Kiev accused Russia of invading Ukraine.

 
 
 
 
  ======= DOW JONES NEWSWIRES ANALYSIS AND COMMENTARIES ======= 
 
 
Heard on the Street 
GETTING TO THE CORE OF THE ECB'S INFLATION PROBLEM 
 

The European Central Bank is under pressure to loosen policy because energy and food prices are dragging inflation lower. The euro zone seems at greater risk of a panic over deflation than of experiencing the phenomenon itself.

 
Money Talks 
THE GOOD NEWS IN EUROPE'S INFLATION STORY 
 

Outright deflation for the single currency region overall seems a distinct prospect. But there's a bright spot. Lower inflation due to dropping energy prices leaves more money to spend on discretionary goods, writes Alen Mattich.