One of the most interesting explanations of emotions that I've read is that emotions are subconscious predictions produced by the brain (sorry, didn't save the link). For instance, happiness is a subconscious prediction of safety. Depression is a subconscious prediction of death. It's like super-scalar execution -- the event hasn't happened yet (and may never happen), but the brain has already calculated its outcome and signals its estimation through emotions.

A few conclusions:

A) Anything with brains has some kind of emotions. The bigger the brain the more developed emotions are.

B) Emotions in animals has nothing to do with "soul" or anything transcendental. It's just a way the animal brain works. Humans can feel empathy to animal emotions because they are also technically animals.