NEW YORK (CNN/Money) - Continued concerns about Iraq and terrorism, and a setback for financial services company J.P. Morgan Chase looked to distract trade early Monday, as investors struggle to break out of three straight weeks of stock declines.

Early indications point to a flat to lower open for the major indexes.

Markets have been jittery for the past few weeks as the Bush administration prepares for a military conflict with Iraq. Administration officials, led by Secretary of State Colin Powell, appeared on the weekend talk shows to make the case, saying Iraq has not complied with United Nations mandates barring development of weapons of mass destruction. The Iraqis, who deny they are developing such weapons, say they will allow inspectors to return only if the United States doesn't bring military action and if U.N. sanctions are lifted.

Fear of the U.S. war involvement and its potential impact on global oil prices has unnerved stock investors in recent weeks.

"Obviously the market would be very jittery about Iraq action. I think you would see a big selloff if that were to happen," Patrick Spears, lead strategist and futures trader at RB&H Financial Services, told CNNfn's CNNmoney Morning.

For details of Friday's session, click above

Another factor in market jitteriness is concern about terrorism. Over the weekend, the FBI arrested five men in the Buffalo, N.Y., area who authorities say are linked to the al Qaeda terrorist network. Muslim community leaders say a sixth suspect was arrested in Bahrain and brought back to the United States.

All this occurs in the wake of the first anniversary of the terrorist attacks that brought down New York's World Trade Center and damaged the Pentagon, killing more than 3,000 people.

Market participants are hoping to get some good news from companies issuing results this week. Among them are Bear Stearns (BSC: Research, Estimates), Morgan Stanley (MWD: Research, Estimates), Best Buy (BBY: Research, Estimates), Nike (NKE: Research, Estimates) and Oracle (ORCL: Research, Estimates).

"We have Oracle coming up soon and these markets need something to break them out one way or another. Obviously, people are hoping it will break out upwards," Spears added. "We've been in this trading range for a while and we need something to get out of it. We need volume and liquidity to break us out of it."

Shares of J.P. Morgan Chase (JPM: Research, Estimates), a Dow component, lost 65 cents to $21.39 in pre-market trade Monday after a judge dismissed the financial services company's fraud claim against insurers to recover nearly $1 billion in losses on trades between Enron and a company called Mahonia. Lehman Bros. issued a fairly negative note following the news, saying that this is a significant setback as the company does not have the reserves to cover this, it comes with potential credit rating downgrades which could limit its ability to get loans, and the firm expects full disclosure from the bank shortly on earnings implications tied to this issue.

The Dow Jones industrial average begins the day at 8,312.69, having lost more than 66 points Friday and 1.4 percent for the week . The Nasdaq composite index is coming off a 0.3 percent decline last week, although it was more than 11 points higher Friday (see chart).

Insurers paced a midday European decline, while Asia-Pacific stocks closed mostly lower Monday; Tokyo's market was shut for a holiday.

Treasury prices fell in early trading, sending the 10-year note yield up to 3.93 percent from 3.91 percent late Friday. The dollar strengthened against the yen and euro.

Brent oil futures slipped 22 cents to $28.45 a barrel in London, where gold fell in early trading.

The government said wholesale inventories rose 0.4 percent in July, double the 0.2 percent increase forecast by economists surveyed by Briefing.com. Inventories rose 0.3 percent in June.

McDonald's (MCD: Research, Estimates), a Dow component, gained 65 cents to $21.18 in pre-market trading after Morgan Stanley upgraded shares of the fast-food retailer to "equal-weight" from "under-weight," saying that the share price is oversold and there is little downside risk. The note was in reaction to some mixed opinions following news Friday that the company's U.S. franchisees approved a plan to start a new national discount menu in an attempt to boost waning U.S. sales.

Biotech company Genzyme General (GENZ: Research, Estimates), which specializes in drugs for rare diseases, warned Monday for the third time this year that slowing sales of its kidney disease treatment drug Renagel will hurt its upcoming results on both a revenue and per share basis. Shares of the stock lost $1.16 to $17.23 in pre-market trade.

Shares of Boeing (BA: Research, Estimates) looked to be active. A strike by the aircraft maker's machinists was avoided over the weekend, but only because union leaders fell just short of the two-thirds majority needed to authorize a walkout. That meant an unpopular contract offer was accepted by default. Boeing shares fell 87 cents to $35.58 Friday; they rose slightly in early European trading Monday.

Other U.S. defense companies looked to be active. Late Friday, the U.S. Navy said it had awarded General Dynamics (GD: Research, Estimates) and Northrop Grumman (NOC: Research, Estimates) a total of $5 billion in contracts to build 10 guided missile destroyers. Shares of General Dynamics added a penny Friday to $83.02, while Northrop Grumman lost 80 cents to $126.00.

Shares of No. 1 chipmaker Intel (INTC: Research, Estimates) looked to be active after Barron's mentioned the company's possible plans to add wireless networking technology to its mobile computing chips; the chips could be ready by 2004. Should it do this, it would pose a new threat to wireless networking chipmakers Texas Instruments (TXN: Research, Estimates), Intersil (ISIL: Research, Estimates) and Microtune (TUNE: Research, Estimates). Separately, Intel announced plans to put both digital and analog functions on the same microchip. Shares of Intel gained 3 cents to $16.03 Friday.

Linux provider Redhat (RHAT: Research, Estimates) gained $1.01 to $6.26 in pre-market trade after it announced that it is expanding its Linux deal with IBM (IBM: Research, Estimates).

Monday is Yom Kippur, the Jewish day of atonement. Many market participants will be absent to take part in the commemoration, which could be a factor in lighter-than-usual trading.