3Q Financial Markets Preview: Disquieting murmurs

Companies and investors looking for a quick end to their pain are unlikely to find much joy in the traditionally slow third quarter. And although some market watchers say the malaise could end in the fall, others say a 1H09 turnaround is more likely. Indeed, the hard times have spurred talk of an industry restructuring not heard in years.

As the drought continues, some loss-making companies are doing what they can to preserve cash, sidelining some programs, partnering earlier or financing on more dilutive terms. But the 2Q numbers show cash-strapped companies are choosing to sit on the sidelines rather than take a PIPE financing on disagreeable terms despite the fact the average cash position of small cap companies continues to deteriorate...