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"The feedback we have received from NYSE Euronext stockholders is very positive, and we would expect NYSE Euronext would, at the very least, meet with us and our advisors to discuss the merits of the proposed combination," Robert Greifeld, Chief Executive Officer of Nasdaq, said in the statement.

NYSE on Sunday said it was sticking with its deal with Deutsche Boerse, calling the rival offer from Nasdaq OMX Group too risky and counter to the Big Board's vision.

The NYSE board's decision smacks the ball back in the court of Nasdaq, which with partner IntercontinentalExchange Inc will have to decide whether to appeal directly to NYSE shareholders, raise the $11.3 billion bid, or walk away.

Perhaps setting the tone for what could be a drawn-out bidding process, NYSE Euronext Chief Executive Duncan Niederauer criticized Nasdaq's unsolicited bid as hollow and undefined, saying it would unacceptably carve up his transatlantic exchange operator.

"It's hard to call it an offer because it's a loosely worded proposal that was, in our minds, an empty vessel," he said in an interview.

"We had a strategy. The combination with Deutsche Boerse is consistent with that strategy. A dismantling of the company is not. End of story," added Niederauer, who would take the reins of a combined Deutsche Boerse-NYSE Euronext.

The formal rejection comes nine days after Nasdaq and ICE unveiled their plan, arguing it would strengthen the United States' hand as the world's bourses scramble to band together to fend off smaller rivals and find new profits.

On Sunday, Nasdaq said "there are significant execution and integration risks to stockholders with the proposed NYSE Euronext/Deutsche Boerse transaction," citing among other factors that the transaction faces European competition hurdles.

But NYSE Euronext's directors, which oversee the Big Board and a handful of European exchanges, found the bid from Nasdaq and ICE "strategically unattractive, with unacceptable execution risk" -- a reference to the antitrust concerns that could come between NYSE and Nasdaq, the top two U.S. exchanges.

The friendly, $10.2 billion deal with Germany's Deutsche Boerse was in shareholders' long-term interest, and "significantly more likely" to be completed, the board said. That merger, announced in February, would create the world's biggest exchange operator.

The counteroffer would give Nasdaq stock exchanges in New York, Amsterdam, Brussels, Lisbon and Paris, as well as U.S. options platforms and technology, while Atlanta-based ICE would get NYSE Euronext's London-based Liffe platform and other derivative businesses.

"Breaking up NYSE Euronext, burdening the pieces with high levels of debt, and destroying its invaluable human capital, would be a strategic mistake in terms of where the global markets are going, and is clearly not in the best interests of our shareholders," NYSE Euronext Chairman Jan-Michiel Hessels said in a statement.

ICE did not immediately comment.

The battle for the parent of the venerable New York Stock Exchange has boosted its shares more than 15 percent. Now, shareholders could face more weeks of uncertainty as the exchanges reposition themselves.

Dow component Alcoa will launch the earnings season after the closing bell on Monday in what is expected to be another solid round of corporate results.

The aluminum producer is expected to report quarterly earnings of 27 cents per share on revenue of $6.07 billion, according to Thomson Reuters estimates.

Some top financial names are also expected to report this week, including JPMorgan Chase & Co and Bank of America Corp. Google Inc is also due to report.

"Earnings are what the market is all about. Earnings are critical in here, guidance is critical in here, the conference calls are critical in here," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

"In terms of earnings and sectors, you basically want to be with those people who have the ability to raise prices or are participating in the commodity price increases," he said. "And you really don't want to be in those people who have the input costs increases and are going to see their margins squeezed by rising commodity prices.

Market analysts have found encouragement for a strong earnings season from the relatively light amount of company preannouncements, leading to the belief that surging commodity costs have yet to compress margins and impact corporate profits.

The Reuters/Jefferies CRB index rose 8 percent in the first quarter, is up 2.6 percent so far in April, and hit its highest level since September 2008.

The S&P 500 has recouped all of the losses suffered in the wake of the Japanese earthquake on March 11, but has been unable to convincingly muscle past the 1,333.58 level, a technical resistance point representing double the 12-year low hit on March 9, 2009.

A potential U.S. government shutdown was averted late on Friday after President Barack Obama signed a short-term spending bill following extended negotiations over the federal budget.

With just over an hour to spare before a midnight deadline, Obama's Democrats and opposition Republicans agreed to a compromise that will cut about $38 billion in spending for the last six months of this fiscal year.

A shutdown was considered unlikely, and the impact on equities from the budget resolution was expected to be muted.

Investors will also eye a batch of economic data this week, providing more insight into the economic recovery, including the consumer and producer prices indexes, the Reuters/University of Michigan consumer sentiment index and the Federal Reserve's Beige Book of economic activity.

"The inflation numbers will certainly be important -- producer price index and consumer price index -- the expectation is inflation will be higher than the Federal Reserve will feel comfortable with," said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, New York.

"The focus (this) week will clearly be on the earnings numbers and the economic numbers and that is where the focus of the market should be."

The listing -- which could be the largest to date in London and one of the largest in Europe -- will force the Swiss-based firm to shed its once-fabled secrecy and open up its huge and successful mining and trading operations to increased scrutiny.

It will also create massive paper wealth, dissolving the group's partnership structure and handing the 485 employees who own the group millions of dollars on average in shares -- though all are expected to be locked in for at least a year, with top management unable to sell for five years.

Glencore is expected to list roughly a 20 percent stake, which, along with short lock-ups on some of the existing shares, would give it the free float necessary to secure a spot in London's top share index.

Sources familiar with the matter have said Glencore and its advisors are working to issue the ITF document in London around mid-April -- this week -- though that could still be delayed.

ITFs, which are not a legal requirement, vary from brief statements setting out little more than a company's sketched plan to list at some stage to hefty documents listing details on timing, finances and management.

Glencore is expected to provide extensive detail, including the name of its new chairman. The Sunday Times named Simon Murray, a Hong Kong businessman and former French foreign legionnaire, as a frontrunner among three candidates.

Murray, currently chairman of Asian private equity firm GEMS, could not be reached for comment on Sunday.

Glencore, which has kept its plans under wraps since briefing analysts more than a month ago, has consistently declined to comment on the timeline of any IPO. The firm also declined to comment on Sunday on the search for a chairman.

"MUST OWN" IN TURBULENT MARKETS?

Sources familiar with the situation have said the firm, valued by one analyst at about $60 billion, has held "positive" talks with investors in recent weeks, and these are expected to have included discussions with potential "cornerstone" investors for the Hong Kong portion of the listing.

Citi (C.N), Morgan Stanley (MS.N) and Credit Suisse (CSGN.VX) are likely to serve as joint global co-ordinators, with Bank of America Merrill Lynch (BAC.N) and BNP Paribas (BNPP.PA) as bookrunners. Barclays Capital (BARC.L), Societe Generale (SOGN.PA) and UBS (UBSN.VX) are likely to make up a third tier of banks advising on the IPO, according to sources familiar with the matter.

Markets, however, remain tough.

Although equities markets have rebounded since a spike in volatility last month on fears of a nuclear crisis in Japan and unrest in the Arab world, bankers say investor willingness to back IPOs in general remains limited.

"The tail risks are still quite elevated with concerns over the Middle East, the oil price, the Portuguese bailout, aftershocks in Japan," said one. "The market is very jumpy."