If Europe fails to deliver a credible plan as promised, global stocks and the euro in particular would likely face immediate pressure. The stakes are particularly high because stocks have staged a blistering rally since the start of October. The CBOE Volatility Index has been steadily declining after topping out in early October. On Monday, the index rose nearly 17%, putting back above 30, at 33.02. European stocks deepened losses after U.S. markets opened lower. London's FTSE lost 0.5% and Germany's DAX fell 1.8%. Japan's Nikkei Average finished up 1.5%, and Hong Kong's Hang Seng jumped by 2%. In addition to Europe, investors also weighed U.S. earnings news, economic data and the announcement of the largest energy merger this year. However, Monday's earnings results were mixed and took a backseat to recent developments in Europe. Citigroup ( C) beat analyst estimates before the open, reporting revenue of $20.83 billion after $20.73 billion a year ago. Analysts had expected revenue of $19.24 billion. Shares slipped 1.7% to $27.93. Meanwhile, Well Fargo ( WFC) missed estimates even though the bank was thought to be stronger than Citigroup. Shares sunk 4.4% to $28.20. One of the worst performers of the day was oilfield services company Halliburton ( HAL), which plunged 7.9% to $34.48 despite beating earnings estimates. The company, which has seen run up in its share value since early October, said it faces competition from lower prices abroad and increased activity in places like Iraq, according to MarketWatch. Kinder Morgan ( KMI) agreed to buy El Paso ( EP) in a cash and stock. The merger would create the largest network of natural gas pipelines in the U.S. El Paso shares surged 24.8% to $24.45, while Kinder Morgan shares advanced 4.8% to $28.19. In another merger, Anadarko Petroleum ( APC) agreed to pay BP ( BP) $4 billion to settle all claims from the Gulf of Mexico oil spill in April 2010. Anadarko shares jumped 5.5% to $74.44 and BP shares gained 0.7% to $40.17. On Monday, the euro slipped against to the greenback after rising to nearly a one-month high. The dollar index, a measure of the dollar's value against a basket of currencies, rose 0.75%. The benchmark 10-year Treasury was up 23/32, diluting the yield to 2.167%. Gold for December delivery lost $6.40 to settle at $1676.60 an ounce. In other commodities, the November crude oil contract shed 44 cents to settle at $86.38 a barrel. A read on manufacturing activity in the New York region showed little change in October. The Empire State manufacturing index continued to contract at -8.48, less than consensus estimate for -4.0, according to ThomsonONE Analytics. In a separate report, industrial production suffered from slowing exports. Capacity utilization in September remained around the August levels and industrial output for September edged up by 0.2% helped by manufacturing. August's output was revised downward to zero growth. -- Written by Chao Deng and Melinda Peer in New York.