GOOD MORNING. Stocks in Asia closed lower today, European shares are down, and U.S. futures are pointing to a lower open.

Wall Street is training its sights on home values and sales this week, but hopes are muted as the housing market continues to stumble through a choppy recovery. Many analysts believe that condition will continue until unemployment, foreclosures and bank lending sort themselves out--feats unlikely to occur before the end of this year.

Today, the Case-Shiller Home Price 20-city index was released, showing a 3.8% increase in the value of residential real estate in the country's larger 20 metropolitan areas for the month of April compared to April 2009. That's higher than the 3% increase that economists polled by Briefing.com expected and higher than March figures that were up 2.3% from a year ago. Also, on Thursday, the National Association of Realtors will release data on pending home sales at 10:00 a.m. for the month of May. These sales have been rising for the past three consecutive months, but economists polled by Briefing.com project a 12.5% decline for May compared to a 6% increase in April.

The biggest obstacle to growth for the housing market has of course been the unemployment rate, which has remained above 9% since May 2009. But now another issue the homebuyer tax credit appears to be influencing housing data in a negative way. Buyers had until the end of April to qualify and through the end of this month to close in order to be eligible for the tax credit. The concern now is that the expiration of the credit will result in declining sales. In May, for example, housing starts fell 10% and existing home sales fell more than 2% compared to the previous month. The underlying level of demand will not be apparent until the distortionary effects coming from the tax credit fade, wrote Theresa Chen, an analyst at Barclays Capital, in a report. We expect new home sales to bottom over the next couple of months and to return to a gradual upward trend thereafter.

In addition, foreclosures are adding downward pressure on the housing market. One in every 400 U.S. housing units received a foreclosure filing during the month of May, according to the most recent data from RealtyTrac.com. That month also marked a 7% drop in default notices from April and the fewest default notices since Novemeber 2008. However, defaults are now expected to rise, as banks sort through a backlog of distressed properties, says Tony Danaher, president of Guild Investment Management, an investment advisor. The banks are getting more responsive in non-payments and getting more proactive speeding up with foreclosures," he says.

For now, an expired tax credit and ongoing foreclosures suggest that home prices and values are unlikely to rise in most regions. It s hard to see residential real estate getting a meaningful bounce in the near term, says Danaher.

IN OTHER NEWS:

• Silicon Valley-based electric car maker Tesla Motor s public offering is set to launch today with shares priced at $17, up from a previously expected $14 to $16 a share. LINK
• Google (GOOG) said it will change how Chinese Internet users access its service after China s government threatened to revoke the company s license. Google says it will stop automatically redirecting users of Google.cn to Google.com.hk, which doesn t censor results. LINK
• European shares dropped today over concerns about Wednesday s presidential election in Germany and Spain s government bond auction on Thursday. LINK