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Critical last-ditch talks to form a coalition government in crisis-struck Greece foundered once more Sunday, leading the country one step closer to new elections, although the socialist party leader said he retained “existing but limited’ optimism for a deal.

The political uncertainty has alarmed the international creditors who have given Greece billions of euros in bailout loans over the past two years, and has thrown the country’s continued presence in the European Union’s joint currency into serious doubt.

President Karolos Papoulias convened the heads of the parties that came in the top three spots in last Sunday’s inconclusive elections, in an ultimate effort to broker an agreement after a week of talks led to deadlock.

The meeting ended without a solution, but the process continued Sunday evening with the president meeting individually with the leaders of smaller parties that made it into parliament. Those include the extremist right-wing Golden Dawn, whose head, Nikolaos Michaloliakos, caused a furor by giving a fascist salute during an Athens city council meeting last year. The party won 7 percent of the vote in the elections.

Voters furious at the handling of Greece’s financial crisis and two years of harsh austerity measures taken in return for billions of euros in international bailout loans punished the formerly dominant socialist PASOK and conservative New Democracy parties in the elections. The two saw their support crumble to the lowest point in decades, while Radical Left Coalition, or Syriza, made big gains to come in second place after campaigning on an anti-bailout platform.

The PASOK and New Democracy leaders could form a coalition with the smaller Democratic Left party of Fotis Kouvelis _ combined they would have 168 seats in the 300-member parliament. New Democracy won 18.9 percent last Sunday while PASOK garnered just 13.2 percent, compared to nearly 44 percent in the last elections in 2009. Kouvelis’ 6.1 percent put him in a kingmaker position, with 19 seats.

But all three insist any power-sharing deal must include Syriza, led by the 38-year-old Alexis Tsipras, given its strong showing at the ballot box.

Tsipras, however, insists he cannot join or even lend his support to a government that will continue implementing the terms of Greece’s international bailout. In return for euro240 billion in rescue loans from the European Union and International Monetary Fund, Greece has imposed severe spending cuts, including slashing pensions and salaries in the public sector, and repeated rounds of tax hikes. The measures have left Greece mired in a fifth year of deep recession, with unemployment spiraling above 21 percent.

“The three parties that have agreed on a two-year government in order to apply (the bailout) have 168 seats in parliament,” Tsipras said after the meeting. “Let them go ahead. Their demand that Syriza participate come what may in their own agreement is senseless and unprecedented.”

Tsipras insists the terms of the bailout must be cancelled payday loans. PASOK head Evangelos Venizelos, who spent nine months handling the crisis as finance minister, and conservative leader Antonis Samaras, say that position is irresponsible and will force Greece out of the euro. Although Sunday’s meeting convened by the president with the three top party leaders was inconclusive, Venizelos said that “I retain some limited but existing optimism that a government can be formed.”

Samaras appeared more pessimistic.

“I made every effort for the cooperation of all,” he said. “Syriza didn’t listen to the mandate of the Greek people and does not accept not only the formation of a viable government, but not even the tolerance of a government which would in fact undertake to renegotiate the terms of the (bailout) and the loan agreement.”

Tsipras, however, stuck to his position, insisting that supporting a pro-bailout government would be a betrayal of his pre-election platform.

“After today’s meeting it is obvious they are demanding that Syriza become an accessory to a crime,” he said after the discussions with the president. “In the name of democracy, of our patriotic duty, we cannot accept this shared guilt. We call on all Greeks to condemn once and for all the forces of the past and to realize that only one hope remains: unity against blackmail in order to prevent the continuing barbarity.

“Fellow Greeks, we can assure you of one thing: we will not betray you.”

Tsipras will also have his eye on recent opinion polls which show his party would gain strength if Greeks go to the ballot box again next month.

A poll published by To Vima newspaper Sunday indicated Syriza would come first in new elections with 20.5 percent of the vote _ less than the 28 percent an earlier opinion poll published Thursday gave him, but still well ahead of New Democracy. Although it would not be enough to form a government, it would put him in the dominant position to form a coalition with smaller anti-bailout parties.

To Vima’s poll, carried out by Kappa Research, showed New Democracy in second place with 18.1 percent and PASOK losing yet more votes to reach 12.2 percent. The poll was carried out on May 9 and 10, and had a margin of error of 3.09 percentage points.

Attention Sunday night will be focused on the president’s meeting with Kouvelis. First in for the evening round of meetings was Panos Kamenos of the anti-bailout right-wing Independent Greeks party, to be followed by Communist Party head Aleka Papariga and then Michaloliakos.

Papoulias’ mediation to broker a deal could in theory continue until May 17, the scheduled opening date for the new parliament, although they are expected to end sooner. If no agreement is reached, Greece will have to hold new elections next month, most likely on June 10th or 17th.

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Final results from France’s presidential election show Francois Hollande narrowly defeated incumbent Nicolas Sarkozy with 51.62 percent of the vote.

Interior Ministry figures released Monday morning show the outgoing Sarkozy garnered 48.38 percent of the vote, giving Hollande a winning margin of 1.13 million votes.

Voter turnout was 80.34 percent, about the same as in the first round of voting April 22.

Hollande is pledging to buck Europe’s austerity trend and NATO’s timetable for Afghanistan no teletrack payday loan.

His allies are now jockeying for government jobs. Sarkozy’s conservative party is turning its sights to upcoming parliamentary elections to try to hold onto its majority despite a wave of support for the left.

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A surprisingly big rebound in a closely watched U.S. manufacturing survey continued to shore up markets Wednesday, particularly in continental Europe where traders returned to their desk after the May Day public holiday to the news that Dow Jones industrial average closed at its highest level in five years.

The Institute for Supply Management reported that U.S. manufacturing expanded last month at its strongest pace since June, with orders, hiring and production all up. That news came on top of a similar report out of China, the world’s No. 2 economy and has helped boost optimism about the state of the global economy, despite the ongoing debt-related problems in much of Europe.

“Just as I am getting really concerned about the depths of Europe’s economic slowdown, and the lack of policy measures to combat it, global financial markets have a spring in their step thanks to better surveys in the U.S. and elsewhere,” said Kit Juckes, an analyst at SG Securities.

In Europe, Germany’s DAX was up 0.8 percent at 6,810 while the CAC-40 in France rose 1.2 percent to 3,250. The FTSE 100 index of leading British shares, which was open Tuesday and reacted to the ISM upside rise unlike its counterparts in Frankfurt and Paris, was down 0.3 percent at 5,793.

Wall Street was poised for further modest gains, a day after the Dow Jones industrial average closed at its highest mark since 2007 _ both Dow futures and the S&P 500 futures were up 0.1 percent.

The focus over the rest of the week is likely to center on the U.S. economy in the run-up to Friday’s release of March nonfarm payrolls data _ the figures often set the market tone for a week or two after their release payday loan.

Later Wednesday, investors will have the monthly private payrolls report from ADP to assess. The ADP figures often provide a guide toward the actual government report.

“A strong reading would follow on nicely from yesterday’s data, and would set the stage for a positive report on Friday,” said Chris Beauchamp, market analyst at IG Index.

In the currency markets, the euro was giving up some recent gains and trading 0.8 percent lower at $1.3136 as figures showed the parlous state of the eurozone economy. Eurostat, the EU’s statistics office, reported that unemployment across the 17-country eurozone rose to 10.9 percent in March, its highest level since the euro was launched in 1999.

Earlier in Asia, Japan’s Nikkei 225 rose 0.7 percent to close at 9,380.25 after a sharp tumble the day before. Hong Kong’s Hang Seng gained 1 percent to 21,309.08.

Mainland Chinese shares advanced after authorities said that China’s two stock exchanges would cut fees charged for trading yuan-denominated shares by 25 percent from June 1. The benchmark Shanghai Composite Index rose 1.8 percent to 2,438.44 and the Shenzhen Composite Index gained 1.7 percent.

Benchmark oil for June delivery was down 34 cents to $105.82 per barrel in electronic trading on the New York Mercantile Exchange.

____

Pamela Sampson in Bangkok contributed to this report.

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The first time I wrote about Sean Egan and his small, independent credit-research firm, Egan-Jones Ratings Co., was in December 2007 for a column about the bond insurer MBIA Inc. And man, did he nail it.

The three big credit raters — Moody’s Investors Service, Standard & Poor’s and Fitch Ratings — all had AAA ratings on MBIA’s insurance unit, their highest grade. Egan said it deserved much lower. Anyone reading MBIA’s financial reports could see the company was losing money and needed billions of dollars of fresh capital.

By mid-2008, the Big Three had cut their ratings. Once again, Egan, a lonely voice of reason who saw the financial crisis coming, had shown his larger competitors to be incompetent or compromised. It was one of many great calls to come for Egan-Jones. As for MBIA, which had no revenue last quarter, it’s still struggling.

So if you had told me back then that the Securities and Exchange Commission’s enforcement division more than four years later would be accusing Egan, and his firm, of securities-law violations — but not any of the big rating companies — there’s no way I would have believed you. That’s what happened last week, though.

Life isn’t fair, as they say. The big raters, paid by the issuers of securities they grade, so far have gotten a pass, even after helping cause the financial crisis by slapping AAA scores on oodles of subprime-mortgage dreck. Egan-Jones, with fewer than 20 employees, makes its money by selling subscriptions to investors, meaning it’s not beholden to issuers. Yet Egan and his firm are getting pinched, although nothing in the SEC’s administrative complaint indicates investors were harmed.

None of this is to excuse infractions Egan-Jones might have committed. We will have to wait and see if the agency’s claims stick in court. That said, it seems Egan-Jones’ mistake was to seek recognition from the SEC at all.

The allegations mainly concern the application Egan-Jones filed with the agency in 2008 to expand its license as a so-called nationally recognized statistical rating organization. The firm, based in Haverford, Pa., first received that designation in 2007 for rating corporate debt, insurance companies and banks. Its 2008 application, which the SEC approved, sought recognition as a rater of asset-backed securities and government bonds.

Egan-Jones at the time said it had about 150 ratings on issuers of asset-backed securities and about 50 on government-debt issuers. The complaint said those numbers were overstated and that the firm hadn’t made any such ratings publicly available free online credit report. Attorneys for Egan, 54, and the firm say their clients filled out the SEC’s application based on their understanding of what the form required.

Additionally, the complaint accused Egan-Jones of committing numerous book-and-record violations, such as failing to maintain a system for retaining e-mails. It also said the firm let two analysts participate in determining ratings for companies in which they owned securities, in violation of agency rules. An attorney for the defendants, Alan Futerfas, said the claims are without merit.

What about the big rating companies? McGraw-Hill Cos., S&P’s parent, in September said the SEC’s staff had issued S&P a “Wells notice” warning that the agency may seek penalties over its rating of a $1.6 billion collateralized debt obligation in 2007. S&P received its letter the month before Egan got its Wells notice. There’s no telling if the SEC will follow through.

In 2010, the SEC issued an investigative report that said a Moody’s rating committee in 2007 knowingly decided to keep inflated ratings on about $1 billion of notes after discovering an error in one of the firm’s models. Later in 2007, Moody’s applied to the SEC for recognition under the same 2006 federal law that Egan-Jones saw as its chance to join the same club as the Big Three.

The rating process used by Moody’s in that instance violated the policies described in the company’s application, the SEC said. However, the report said the agency decided not to accuse Moody’s of violating any laws, because some of the conduct occurred outside the U.S., presenting jurisdictional hurdles. Lucky break, I guess.

The way Congress and the SEC have rigged this game, nationally recognized credit raters are a unique species of opinion merchants, endowed with sweeping authority and special privileges. Institutional money managers often are required by law to abide by their judgments. The better approach would be to scrap the designation, so investors are encouraged to do their own homework.

Egan-Jones, which has been in business since 1992, could have continued as an independent, not subject to government oversight or control. Instead it chose to play within the Big Three’s system, exposing itself to the whims of the SEC. Now it’s paying the price.

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Selling soybeans, iron and copper ore and other commodities to Asian countries has transformed Latin America over the past decade, stabilizing economies despite worldwide crises and lifting tens of millions of people into the middle class. Now, say officials from both Asia and Latin America, a second gold rush is under way.

Asian investors flush with hundreds of billions of dollars in cash now see Latin America as a top business opportunity, and they’re flooding into manufacturing, construction and other industries, particularly in up-and-coming countries such as Brazil, Peru and Mexico. That’s transforming the lucrative relationship that was based primarily on exporting raw materials to Asia, an arrangement that frustrated governments eager to stimulate their own manufacturing.

Government and business officials meeting this week at the World Economic Forum in Mexico said the investment surge means Asia is poised to overtake the United States and the European Union as Latin America’s top trading partner over the next decade. Asian representatives have been an unmistakable presence at the forum, with South Korean, Chinese and Japanese investors making the rounds at this seaside city’s gleaming white convention hall.

“We’re talking about tens of billions of dollars in just Korean banks looking for a destination,” said Kevin Lu, Asia Pacific regional director of a World Bank Group agency that insures foreign investments against political risk. “When I meet with investors, Latin America is in every conversation about this.”

Already, Chinese investment in Latin America has jumped from a few million dollars just a few years ago to about $15 billion in 2010, with most of the money going into mining and other extractive industries in Brazil, Peru and other nations, said Alicia Barcena, executive secretary for the Chile-based United Nations Economic Commission for Latin America and the Caribbean. Chinese investment in the region jumped again last year, to about $23 billion, Barcena said.

Japan, meanwhile, surpassed even that figure last year and displaced China as the region’s top Asian investment and trade partner, Barcena said. She didn’t provide a precise number for Japan’s total.

China already ranks among the top three trading partners with Peru, Brazil, Chile and Argentina, and Asian investment in auto and other manufacturing in Mexican industrial cities has greatly expanded the middle class.

“I don’t have any doubt that Asia will soon become the region’s top trading partner,” said Mexican Economy Secretary Bruno Ferrari Garcia de Alba. “In Mexico, we believe we need to get closer and closer to Asia.”

According to the U.N. economic commission, 17 percent of Latin America’s exports went to Asian-Pacific countries in 2010, more than tripling from 5 percent in 2000 business card design. Over the same span, the share of the region’s total exports that went to the United States dropped from 60 percent to 40 percent.

Ferrari said Asian-Pacific countries buy 31 percent of Mexico’s total exports, amounting to $110 billion, with that number growing by an average of 20 percent annually over the past five years.

Lu, of the World Bank Group agency, said raw material industries in Latin America are now getting only 40 percent to 50 percent of total Asian investment in the region, while the rest goes to manufacturing, construction and other businesses.

He said foreign money flowing into a new region often first goes into buying natural resources because it’s a simpler business than making things, which requires dealing with labor, setting up supply chains and complying with various government rules.

“The Chinese look at natural resources as easier to manage, while manufacturing and construction is a lot more complicated,” Lu said. “It’s a very natural progression for any bilateral trade relationship to start to become broader, and to move into other areas.”

Hanwha, a South Korean petrochemicals company, is considering manufacturing in Latin America rather than continue to concentrate its production in China, said Sang M. Lee, CEO of the company’s U.S. operations.

At the same time, the company is eyeing the Latin American market, especially as it moves into solar energy, Lee said after a Wednesday morning at the World Economic Forum dedicated to the future of Asian-Latin American relations.

“We need that new production because there are a lot of resources in Latin America, and we need more markets,” Lee said. “We’re just at a beginning stage with this.”

To be seen is whether the rising Asian investment will quiet concerns around Latin America that exporting commodities while importing manufactured Asian goods will ruin domestic companies and leave the region vulnerable. Brazil, in particular, has raised import tariffs on manufactured goods to protect its own industries.

Peruvian Trade and Tourism Minister Jose Luis Silva Martinot made clear Wednesday that despite the economic benefits from Asian trade and investment, Peru still sees China and other Asian countries as competitors.

“We can see they’re up scaling the quality of their products,” Silva said. “Three-quarters of our exports are raw materials. It’s something we want to change.”

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If you thought having thousands of Twitter followers made you famous, how about showing up in a reality television series?

Bravo announced plans on Wednesday for two new shows focused on the tech realm.

The network is teaming with Facebook founder Mark Zuckerberg’s sister Randi Zuckerberg, who left Facebook in August to start her own media company, for a series with the working title of "Silicon Valley."

According to Bravo’s site, the show "captures the intertwining lives of young professionals on the path to becoming Silicon Valley’s next great success stories."

It’s too early to tell say whether Facebook founder Mark Zuckerberg will make a cameo. Perhaps instead of cat-fights, viewers will see code wars and hackathons. Bravo was mum on the details, and Zuckerberg — that’s Randi, not Mark — did not immediately respond to a request for comment.

Bravo also unveiled plans for a tech series with the working title called "Huh?," giving viewers an inside look at the crew behind ICanHasCheezburger.com. Run by entrepreneur Ben Huh, the Seattle-based Cheezburger, Inc. is known for LOLcats, FAIL blog, and its empire of Internet memes.

Bravo has frequently teamed up with buzzy tech startups, from Foursquare to TaskRabbit, to promote its shows, so a show tracking the young founders behind many of those startups isn’t a complete surprise.

Let’s just hope "Silicon Valley" doesn’t end up titled "Real Entrepreneurs of Silicon Valley."  

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U.S. builders trimmed activity for a second straight month in February, pushing construction spending down by the largest amount in seven months. There was widespread weakness with spending on home building, office construction and government projects all dropping.

The Commerce Department reported Monday that construction spending fell 1.1 percent in February after a drop of 0.8 percent in January which was revised down from an initial estimate of a decline of 0.1 percent.

With the back-to-back declines, construction spending stood at a seasonally adjusted annual rate of $808.9 billion in February, just 6.1 percent above a low hit in March 2011 and about one-third lower than the high hit during the housing boom.

The construction weakness over the past two months underscored that the nation’s construction industry is still struggling to emerge from the 2007-2009 recession, a decline that was triggered by a collapse in housing following an unsustainable boom in that sector.

Housing construction was unchanged in February at a seasonally adjusted annual rate of $246.5 billion after a small 0.1 percent dip in January. The weakness last month came from a 1.5 percent drop in construction of single-family homes which offset a 2 percent rise in apartment construction.

Spending on non-residential construction projects dropped 1.6 percent following a 2.3 percent decline in January. The February decline reflected weakness in office construction, hotels and shopping malls.

Government construction dropped 1.7 percent to an annual rate of $281 fast cash without a hassle.6 billion with state and local building projects down 2.1 percent while spending by the federal government rose 1.9 percent..

In February, sales of new homes fell for a second straight month, a reminder that the depressed housing market remains weak despite some signs of improvement.

Sales of new homes fell 1.6 percent in February to an annual rate of 313,000. That is less than half the 700,000 homes that economists consider to be healthy. By contrast, a mild winter and three months of strong job gains have lifted sales of previously owned homes but that support has not benefited the new home market.

Sales of previously owned homes have risen more than 13 percent since July and January and February combined for the best winter of re-sales in five years, right at the start of the housing crisis.

Though new-home sales represent less than 10 percent of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to the National Association of Home Builders.

Builders are growing more confident after seeing a growing number of people express interest in buying this year. They’ve responded by requesting the most permits to build single-family homes and apartments since October 2008.

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A growing number of U.S. companies such as Facebook and Carlyle Group lining up to go public and a smattering of U.S. and European secondary offerings are once again giving investment bankers hope that the moribund equity capital markets may finally be waking up.

The S&P 500 has risen 12 percent in the first quarter and the market volatility tracker VIX is at five-year lows as fears about the U.S. economy and the euro zone debt crisis ease, prompting more companies to tap the public markets after being effectively shut out for the last few months.

Global equity fundraising, including IPOs and secondary offerings, tumbled 25.8 percent in the first quarter of 2012 to $150.2 billion, compared with the same period in 2011, Thomson Reuters data shows.

Global IPO proceeds, which reached $17.4 billion in 173 issues, sank to their lowest volume since the second quarter of 2009, the data shows.

Many risks to a recovery still persist, such as the impact of slowing growth in China on Asian markets, but bankers said they expect volumes at least in the United States to improve over the rest of the year.

“The IPO market had been very slow to get out of the gate in the first half of the quarter, but the last half has really been catching up,” said David Hermer, head of Americas syndicate at Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz). “A number of recent landmark deals will materially change the landscape, in a positive way.”

Technology deals, which captured nearly a third of all U.S. IPOs during the quarter, are expected to lead the market again, as investors pile into sectors like cloud computing, social media and mobile.

Bankers said even European companies, particularly those with a tech focus, are thinking about U.S. listings.

British vacuum technology firm Edwards, which pulled a London float last year due to choppy markets, and German high-tech lighting company Novaled this month filed with U.S. regulators for IPOs.

In a sign that the recovery might be more broad-based, companies in other sectors are beginning to test the markets as well. Private equity giant Carlyle Group (CG.O: Quote, Profile, Research, Stock Buzz), crafts retailer Michaels Stores MCHST.UL and real estate investment trust Empire State Realty Trust (ESB.N: Quote, Profile, Research, Stock Buzz) are all planning IPOs.

“You’re going to see more industrial companies coming out, many with higher levels of financial leverage, along with technology, energy and consumer retail,” said James Palmer, New York-based managing director of equity capital markets at UBS AG (UBSN.VX: Quote, Profile, Research, Stock Buzz). “You’ll see a much broader spectrum in both the quality and type of product.”

A big chunk of the activity is expected to come from private equity firms, as they look to exit investments, many of which date back to the buyout boom of 2006-2007, and sell down stakes through follow-on offerings.

“Sponsors are going to play an important role in overall capital formation,” said Phil Drury, co-head of equity capital markets in the Americas at Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz).

For banks, more activity means more underwriting fees fast cash loans. In the first quarter, Citigroup topped the global ranking of equity underwriters with 76 deals accounting for proceeds of $14.3 billion, up from No. 7 in the first quarter of 2011.

Goldman Sachs (GS.N: Quote, Profile, Research, Stock Buzz) came in at No. 2, down from its No. 1 slot in the prior year, and JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz) took No. 3, up from its No. 5 position.

Guosen Securities, a Chinese investment bank, was the leader for global IPOs, raising $1.4 billion for clients, thanks to a number of solo deals like a $337.7 million IPO for computer knitting machine producer Ningbo Cixing Co and a $249.8 million offering for silicon maker Xi’an LONGi Silicon Materials.

“The IPO market has been slow to start, but the stars are finally starting to align,” said Brian Reilly, head of U.S. equity capital markets at Barclays (BARC.L: Quote, Profile, Research, Stock Buzz).

TENTATIVE RECOVERY

While the level of activity is expected to rebound from the lows seen over the last six months, bankers said the global markets are far from getting back to normal. Risks such as worries about a fragile global economy, Europe’s debt problems and escalating tensions with Iran continue to add uncertainty and weigh down the markets.

Investors’ concerns over a slowdown in China’s economy put a damper on the Asia-Pacific market, which had dominated equity capital market issuance as the West grappled with the aftermath of the financial crisis of 2008.

“The problems are much closer to home,” said Rupert Mitchell, head of equity syndication for Asia-Pacific at Citigroup. “The world is worried about China right now, where growth is going to be more measured this year.”

Activity in the region tumbled 37 percent in the first quarter from a year earlier to $36.7 billion, the lowest quarterly volume since the second quarter of 2009. IPOs were down 75 percent, accounting for most of the weakness in the beginning of the year.

The major listings expected in Asia this year include the $1 billion IPO by high-end jeweler Graff Diamonds and $1.5 billion offering by Haitong Securities in Hong Kong; the $1 billion IPO by football club Manchester United MNU.UL in Singapore; and nearly $4 billion from two deals in Malaysia: Felda Global Ventures and healthcare company Parkway Pantai.

In Europe, German chemicals maker Evonik and insurance group Talanx and Italian aero-engine parts maker Avio are among those seen as most likely to launch their IPOs in the first half. The sale of the Russian central bank’s stake in Sberbank (SBER.MM: Quote, Profile, Research, Stock Buzz), worth around $6 billion, could also be launched in mid-April.

But overall companies are likely to wait at least until the second half of the year before tapping the markets, bankers said.

“The market in Europe is open and investors are engaged, but every deal will be evaluated on its own merit and on a case-by-case basis,” said Viswas Raghavan, global head of equity capital markets at JPMorgan.

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