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Current Futures: Dow +25.00, S&P +3.40, NASDAQ +1.25
Asian markets and U.S. futures are trading in the green, on weak volume as investors expect the U.S. car manufacturer GM to file for bankruptcy on Monday morning.
It looks like GM has reached the end of the line, after 101 years of history. GM was for many years one of the biggest car brands in the world, but the last few years proved to be too much as the car-company incurred mounds of debt. Since 2004, GM accrued almost $90 billion in debt, as it tried to restructure and find its way back to profitability, unfortunately never happening.
For now, as much as 50% of GM’s bondholders are expected to take part in the new car company, which would replace GM after the bankruptcy fillings. These bondholders will receive as much as 10% of the new company, while United Auto Workers would receive as much as 17.5%. The biggest stake would be taken by the U.S. Government, which most likely will financially support the new company.
Later in the session, most of the European markets will be closed as investors observe the Whit Monday holiday. This will probably have a strong influence over the financial markets, reducing substantially the implied volume and momentum. For now, Asian markets are posting modest gains, led by commodity stocks and car-manufacturers.
Overnight, the Japanese Nikkei added 86.18 points (0.91%) to 9,608.68. The Australian S&P/Asx rose 32.50 points (0.85%) to 3,850.60.
Crude oil for July delivery was recently trading at $64.50 per barrel, higher by $0.20.
Gold for July delivery was recently trading lower by $0.20 to $980.40.
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