GM Files for Bankruptcy Protection
As widely expected, General Motors Corp. filed for bankruptcy protection under the Chapter 11 provisions of US bankruptcy law earlier this morning. The Obama administration is pushing for a quick resolution with the expectation that the US government will acquire 60 percent ownership, the Canadian government will receive 12.5 percent, while the United Autoworkers Union assumes 17.5 percent. The remaining 10 percent will be awarded to a group of unsecured bondholders while shareholders will likely be wiped out. More
British Pound Gains on US Dollar
Sterling continues to make inroads against the dollar rising to a seven-month high of $1.6288 in early-morning trading in London. More
Fiat Deal for Chrysler Approved
The court overseeing Chrysler’s bankruptcy protection bid has ruled that most of Chrysler’s assets can be sold to a consortium including the United Autoworkers Union and Fiat. More
Crude Closing in on $68 a Barrel
Growing optimism has pushed the price of crude for July delivery up by $1.38 to $67.69 a barrel in electronic trading on the New York Mercantile Exchange. Despite the recent run-up in prices, gloabl demand remains weak and supplies – particularly in the US – remain very high.
“The market sent a clear message in May, it will ignore any and all bad news. We expect to see a correction” that will take prices back down to $40 a barrel, wrote Stephen Schork in his Schork Report. More
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