By Carlos Guillen

Equity markets began the trading day slightly up but have been sliding into the red as debt restructuring talks in Greece continue to remain unsolved. While the hope continues to be that Greece will resolve its debt agreement with private bond holders, so far there is no conclusive result. Over the weekend, creditors left Athens without agreeing on a solid debt restructuring deal. They apparently are not willing to accept losing any more than 65 to 70 percent of the value of the Greek government bonds they hold. The word is that private investors have put forth their part of the plan to write down the value of their bond assets, although the details are not known. At the moment, it is up to the Greek government to accept or reject the offer.

Euro zone finance ministers were originally supposed to discuss a new bailout for Greece in Brussels today, but it is contingent on a debt restructuring deal involving private creditors, including many of the largest banks in Europe. Although negotiations will be difficult, there needs to be a second program implemented for Greece so that the next tranche can be released in March.

Other rather discouraging news from the euro zone was that GDP growth in Spain is expected to contract 1.5 percent this year. According to the Bank of Spain, GDP declined sequentially by 0.3 percent during the fourth quarter of 2011, but it still increased by 0.3 percent from the year-ago level. GDP this year will decline as unemployment is forecasted to reach 23.4 percent, but in 2013 growth may return softly, increasing just 0.2 percent for the full year. Of course all bets are off if Spain fails to meet its strict budgetary goals.

Despite that equity markets are currently in the red, volatility still remains low; however, we need to see a solid break above 12,700, and this is just not happening at the moment. Some important upcoming events this week include the FOMC directives this Wednesday, GDP advanced estimate, and Michigan Sentiment on Friday. These may very well put us above the resistance level by the end of the week.

Natgas Ignites
By David Urani

One of the more interesting market moves for the day comes from natural gas, with February futures up 4.6%. Gas prices had been all the way down to 2002 levels last week during what has turned out to be a very tame winter. As a result gas stockpiles have been building up, especially with a lot of new shale production having gone online recently.

Natural gas is finally getting a boost now though with a couple of news items. Firstly there is Chesapeake Energy, the second largest producer in the country, saying that it will cut back production. The company says that it is responsible for more than half of the supply glut that has built up onto the market, and for them to cut back is a significant step for the market. They say they will cut 8% of their output and cut the number of operating drilling rigs almost in half.

With prices so low, that means some of the producers have discount value, and today we're seeing investors swoop in on gas companies. Apache (APA) says it will be buying Cordillera Energy for $2.85 billion and Chinese energy firm Sinopec will make a $1.1 billion investment into an Australian natural gas operation.

Even if the winter does stay tame for the rest of the season and prices remain vulnerable near term, you'd have to say that in the long term natural gas looks cheap. Unless you're a believer that global warming is somehow here and upon us for good, one has to think following winters will show more demand for heating. And as far as its overall usage, natural gas continues to gain traction as an energy source, including as a replacement for coal power plants and as an alternative fuel for cars and trucks. That said, rising shale production does have strong implications for long term supply.