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23:05 Monday 28 June, 2010

Investors scouring for cheap real estate assets are starting to find opportunities in bankruptcy courts, where companies are selling assets they no longer can afford to keep.

After the worst recession since the Great Depression, many real estate companies and developers that sought bankruptcy protection are selling properties through 363 sales, so named to refer to the section of the bankruptcy code that deals with this procedure. Such sales, typically processed quickly, hand the properties free of liens to the new owners and provide a way for real-estate investors to buy distressed debt.

In the last six months, many opportunity funds created to buy such troubled assets have been disappointed at the scarcity of properties listed in the market. The paucity results mainly from lenders not forcing owners into foreclosure, which in turn has helped maintain status quo in commercial real estate despite a 10% delinquency rate.

Following in the footsteps of such corporations as Chrysler LLC and Eddie Bauer Holdings Inc., more real-estate companies are using 363 sales to sell assets without calling it a liquidation.

23:01 Monday 28 June, 2010

Current oil prices are "comfortable," and there will be no change in production strategy, nor other meetings before the planned one in October, the Secretary General of the Organization of Petroleum Exporting Countries said Sunday.

"Current prices are comfortable," Abdalla El-Badri told reporters ahead of a meeting with European Union officials on Monday. "I don't see any change in the production, I don't see any meeting coming before the set up meeting in October," he added.

21:06 Monday 28 June, 2010

The banking crisis is not over and the global economic recovery is far from guaranteed, according to Danny Gabay, a director at Fathom Consulting in London.

Another analyst voiced fears of a double-dip recession Monday, while others expect slow growth ahead but not a double dip.

While a gradual recovery led by the US and Asia is still Gabay's central forecast, he said the risks are becoming far uglier and collectively more likely forcing investors to walk a tight rope.

"We see the chance of two major evils. Weak growth with inflation or even weaker growth and deflation," says Gabay.

"The biggest risk for the G4 is a repeat of Japan's lost decade, rather than inflation. We see a 40 percent chance of deflation across the entire G4 in 2011," he said.

21:03 Monday 28 June, 2010

The key factor for the stock market in coming months will be the pace at which the global economy slows, Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets, told CNBC Monday.

Some analysts expect slow growth ahead, but do not predict a double-dip recession, saying that the corporate sector has adjusted already.

“The market is moving back and forth between hope and fear. The market is at the same time complicated and extremely easy to understand. There are only two games in town, the risk on and risk off trade” Gijsels told CNBC.

“Expect volatility to remain quite high as long as the market does not have an answer to the most important question: how strong will the slowdown be in the second half of this year and going into 2011,” he added.

20:59 Monday 28 June, 2010

President Barack Obama said Sunday he would follow through on a pledge to rein in soaring U.S. budget deficits and said that would involve presenting Americans with "some very difficult choices" next year.

Obama also said that he believed a review of the "messy and unfair" U.S. tax code should be considered as part of a plan to deal with long-term budget problems.

"I'm serious about it," Obama said when asked at a news conference at the Group of 20 summit in Canada if he believed he could meet his deficit reduction goals.

20:55 Monday 28 June, 2010

Safe havens are back in vogue as global growth prospects decline and the European debt crisis rumbles on. Despite Japan's economic and fiscal problems, the yen will continue to rise.

20:50 Monday 28 June, 2010

U.S. stock futures posted modest gains on Monday, as leaders of the world's advanced economies pledged to halve their government deficits by 2013.

Futures on the Dow Jones Industrial Average rose 28 points to 10,132. S&P 500 futures added 4.30 points to 1,079 and Nasdaq 100 futures gained 7 points to 1,846.20.

Most major U.S. stock indexes finished slightly higher on Friday.

Meeting in Canada over the weekend, leaders of the Group of 20 major economies agreed on common goals to reduce deficits and debt. They vowed to stabilize or reduce the ratios of government debt to gross domestic product by 2016.

Lars Christensen, chief analyst at Danske Bank, downplayed the importance of the G-20 commitments.

"I don't think the G-20 has changed a lot in terms of market sentiment," Christensen said. "The world picture is still one of caution. We saw a little bit of stabilization on Friday and that carries through today as there is a lack of much news."

15:39 Monday 28 June, 2010

There will be a raft of economic data, new legislation and a small handful of earnings reports, any or all of which could add to stock-market volatility, for investors to digest as July gets under way.

The House and Senate are expected to vote on Friday's deal by their negotiators that would create the most sweeping overhaul of bank regulation since the Great Depression, placing new restrictions on big banks, pinning back the power of the Federal Reserve and bringing in more consumer protections.

"It establishes the greatest consumer financial protections in American history," said Treasury Secretary Timothy Geithner. "It prevents financial firms from taking risks that will threaten the economy. And it provides the government with significant new tools to better protect taxpayers from the damage of future financial crises."

The legislation is expected to pass both houses and be sent to President Obama for his signature into law before the July 4 holiday.

15:34 Monday 28 June, 2010

China is likely tracking more than a dozen currencies in addition to the U.S. dollar in setting the value of the yuan, though the greenback likely retains its dominant status, analysts say.

China -- which adjusts the yuan trading range at the beginning of trading each day -- said it would use a basket of currencies to manage exchange rate when it first ended its official U.S.-dollar peg in July 2005.

"Many doubt if China is serious about the basket this time around," the analysts said. "But to test this, we need to first come up with a basket."

11:41 Monday 28 June, 2010

Much of the initial excitement about China ending its de-facto peg to the dollar has worn off, leaving time for more sober reflection of what will happen and how quickly. Perhaps not too much effect will be felt immediately, but it's where China is heading that gets interesting.

We have clearly witnessed a certain amount of tactical public relations by Beijing in the run-up to this weekend's summit of the Group of 20 major economies. On cue, the People's Bank of China even allowed the yuan, or renminbi, to edge up 0.3% on Friday to a recent high against the dollar.

In fact, broker CLSA suggests Beijing's efforts have helped delay a U.S.-China trade war, although unlikely for long. They also forecast a 5% annualized increase in the renminbi against the dollar, hardly ground shaking. That looks in line with the 16% appreciation in the currency against the dollar from 2005 until it was again pegged to the greenback.

11:36 Monday 28 June, 2010

Japanese shares traded nearly unchanged Monday morning in Tokyo, finding little support ahead of a slew of key economic data this week, including unemployment and industrial output.

08:24 Monday 28 June, 2010

Jobs, manufacturing reports will top summer vacation-week data with few earnings reports on tap. Historic financial-regulation bill should go to President Obama for signing into law. MarketWatch's Greg Morcroft reports.

08:20 Monday 28 June, 2010

Asia-focused lender Standard Chartered is due to deliver an update, and Portugal Telecom holds a vote on whether to take an offer for a Brazilian mobile stake. Euro-zone unemployment data is due Friday.

08:15 Monday 28 June, 2010

Japan's tankan survey is expected to show improved business confidence. Investors will watch for signs that China's economy may be slowing further. Japanese automakers will report monthly sales results. MarketWatch's Andria Cheng reports.

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