Another Round of Economic Reports to be Released Today
- Dec 23, 2008
With economic and housing sector reports slated for release today, investors aren’t expecting good news. Several housing market reports as well as the government’s report on the third-quarter gross domestic product figures will be released today along with a consumer confidence report, according to CNNMoney.com. One report focuses on existing home sales in November with the National Association of Realtors expected to report that sales declined to 4.93 million in November from 4.98 million in October, CNNMoney.com reported. The Census Bureau is expected to report that new home sales fell to a seasonally adjusted 420,000 last month, down from from 433,000 in October, too, the report stated.Builders such as Centex Corp., Pulte Homes Inc. and Hovnanian Enterprises Inc. have been caught with a glut of unsold properties over the past year as mortgages became harder to get and sales slowed. Developers have slashed prices, but many buyers remain on the sidelines, waiting and watching for bigger discounts, according to the Associated Press. Wall Street expects the gross domestic product, the country’s total output of goods and services, fell at an annual rate of 0.5 percent in the July-September quarter, according to the Associated Press. That would match the estimate for GDP made a month ago, but economists believe that small drop will be followed by a much larger plunge in the current October-December quarter, the report stated.Additionally, the University of Michigan is expected to revise its consumer sentiment index lower to a reading of 58.6, down from the 59.1 reading it announced on Dec. 12, CNNMoney.com reported. Bankruptcy courts have been busy as Circuit City Stores got final approval for $1.1 billion in financing to provide liquidity as it reorganizes and said its same-store sales had dropped even more steeply than predicted, Reuters reported. The debtor-in-possession financing, approved by U.S. Bankruptcy Court, enables the retailer to pay vendors and other business partners for goods and services received. The company filed for Chapter 11 protection last month, the report added. Also, a U.S. bankruptcy judge approved a settlement calling for $1.27 billion in cash plus securities with a face value of $5.7 billion to be transferred to Barclays Plc in connection with its purchase of the core U.S. brokerage business of Lehman Brothers Holdings Inc.The settlement relates to fund transfers made the week of Sept. 15 to keep Lehman’s brokerage business operating while the parent company filed for Chapter 11 bankruptcy, Reuters reported. American International Group Inc. is selling assets with Munich Re, a German reinsurer, buying AIG subsidiary HSB Group Inc., parent of The Hartford Steam Boiler Inspection, an equipment insurer, CNNMoney.com reported. The companies said that Munich Re will acquire all outstanding shares for $742 million in cash and assume $76 million of outstanding HSB capital securities. The deal is expected to close at the end of the first quarter of 2009, AIG said in the article. Smartphone maker Palm received $100 million of private equity funds from private equity firm Elevation Partners on Monday, Forbes reported.