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

Investors this morning will begin digesting Congressional developments which are likely to impact trading today and have long-term implications for the stock market as well. The most significant was that the House voted in favor of the financial reform bill and passed it onto the Senate where it s now expected to be voted on after the July 4th vacation.

For investors, some of the more notable points in the bill center on the government s heightened level of authority to intervene in the financial markets. The bill not only would increase the Federal Reserve s role over large financial firms, it would increase regulation of derivatives, and create the Consumer Financial Protection Bureau, which will oversee consumer lending products. It appears that these measures could provide additional protections to investors from failing firms. Also, investors could experience a new relationship with their broker-dealer as the bill seeks to raise the standard for broker dealers giving investment advice by allowing the Securities and Exchange Commission to hold them to a fiduciary standard.

However, for shareholders, a source of concern remains whether these measures within the bill will add pressure on banks profit margins. For example, the bill requires banks that package loans to hold onto 5% of the credit risk on their balance sheets in most cases. Banks will also have to post more collateral when trading derivatives. But a common misconception is that the bill will add capital pressures only on financial firms; in fact, it s likely to also affect most companies that trade derivatives to handle their exposure, says Andrew Barber, a strategist at Waverly Advisors, an asset management firm. The bill requires companies engaging in derivatives trading to post more collateral. That, in turn, could tie up money that s on their balance sheets, putting more pressure on profits and even resulting in a company having less money to hire new employees, he says.

In addition, last night the Senate voted to extend the homebuyer tax credit by giving buyers until September 30 to close a sale. (The House passed the measure earlier this week.) Some analysts projected that without the tax-credit extension, a number of buyers who were in contract but missed the original June 30th deadline to close would walk away from the sale. That number could have been up to 180,000 buyers, wrote David Rosenberg, chief economist and strategist at Gluskin Sheff, in a report. Then there s the impact on near term home sales; recently, declining sales numbers were attributed largely to the expiration of the credit it now seems the housing market may have yet another lifeline.

IN OTHER NEWS:

• Morgan Stanley (MS) may hire 500 private bankers by the end of 2011 to offer more lending products. LINK
• Fannie Mae (Freddie Mac) and Freddie Mac () may not accept home loans for consumers who take advantage of energy-efficiency programs. LINK
• Microsoft (MSFT) has pulled the plug on its Kin phones underscoring the challenges it faces in the smartphone market. LINK