Economy
Eurozone business activity got off to a solid start in the second quarter, according to Markit, whose composite PMI rose to 54 in April, in line with expectations and up from 53.1 in March. The gauge, says Markit, points to Q2 GDP growth of 0.5%, the strongest in three years. "The most exciting news is the strong upturns that are becoming apparent in Spain and Ireland, where the rates of growth rose to the fastest for seven and eight years respectively," says Markit chief economist Chris Williamson.

Pro-Russian militants killed four government servicemen and downed a military helicopter yesterday as Ukraine sought to regain ground in the Eastern part of the country. Acting Interior Minister Arsen Avakov, in a Facebook posting, said government forces may have killed about 30 of the rebels. Putin's push to further destabilize the country comes with Presidential elections looming on May 25. French President Hollande warned Putin of "chaos and a risk of war" should the election be thwarted. "We must do everything to avoid civil war ... You know when it starts but never when it ends."

Stocks
Target Chairman and CEO Gregg Steinhafel resigned, effective immediately, and was replaced in the CEO's spot on an interim basis by CFO John Mulligan. December's data breach may have been the final straw, but it was a number of missteps which upped the pressure for a change at the top. Among them: An expansion into Canada that hasn't worked out, an e-commerce strategy failing to gain momentum, and - most of all - a Target (TGT) formula for bringing in customers that isn't working the way it used to. The number of transactions at Target fell 2.7% in 2013, including a 5.5% decline in the key fourth quarter - the worst print since the company began reporting the metric in 2008. The stock fell 3.5% following the news.

In a deal that had been tipped late last week, Bayer (OTCPK:BAYZF, OTCPK:BAYRY) is buying Merck's (MRK) consumer care business - home of brands such as Claritin, Afrin, and Coppertone - for $14.2B. “By unlocking value in Merck Consumer Care, we’re able to further our goal of being the premier research-intensive biopharmaceutical company through targeted investments that strengthen our product portfolio and enhance our pipeline," says Merck CEO Kenneth Frazier.

David Einhorn took aim at a high-flyer in his Ira Sohn presentation, unveiling a short position in athenahealth (ATHN) and sending the shares plunging 12% in after-hours trade. Calling athenahealth a well-meaning stock caught up in a broader bubble, Einhorn says the shares "easily fall 80% or more" from their recent high.

AIG's first quarter profit came in ahead of expectations, but the stock was lower by 3% in after-hours trade after revenue of $8.23B fell short of analyst estimates by more than $1B. Income at the property and casualty unit of $1.159B dropped from $1.557B a year ago thanks to higher catastrophe losses. Pronouncing himself "underwhelmed with the results," Janney's Larry Greenberg notes the unexpectedly strong income from AIG's "Direct Investment Book" accounted for about $0.13 of earnings (roughly the size of the "beat"). Greenberg also points out a faster-than-expected pace of share buybacks as boosting EPS a bit. The company used up $867M of its $1.4B share repurchase authorization in Q1.

The DOJ and Credit Suisse are reportedly nearing a $1B settlement over charges the bank helped Americans evade taxes. In a new tack for prosecutors, they are trying to wring a guilty plea from Credit Suisse (CS) to go along with the fine, and, according to reports, are confident they can do so. Earlier in the day, Attorney General Eric Holder - who has come under criticism for the lack of criminal actions against the big banks - suggested charges were near for at least a couple of lenders.

In a Web win for Wal-Mart, global Internet sales for the bricks-and-mortar giant rose 30% in 2013, faster than Amazon's (AMZN) 20% growth. Amazon, of course, still dwarfs Wal-Mart's (WMT) Web sales, with online revenue of $67.8B vs. Wal-Mart's $10B. Intent on catching up, Wal-Mart has been spending heavily and also buying up e-commerce businesses. Today it is expected to announce the purchase of Adchemy - a search-engine marketing company helping retailers optimize their use of search terms.

Today's economic calendar:
7:45 ICSC Retail Store Sales
8:30 Gallop US ECI
8:30 International Trade
8:55 Redbook Chain Store Sales
1:00 PM Results of $29B, 3-Year Note Auction

Notable earnings before Tuesday’s open: ACM, ACOR, AER, AKRX, AME, ARCC, ARCO, ARW, BCE, CBOE, CNK, COCO, CRTO, CRZO, CYNO, DISCA, DNR, DTV, DWRE, EMR, EXH, EXLP, FE, GDP, GLDD, HCP, HFC, HPT, HSH, HSIC, HTH, IFF, ISIS, KWK, MMP, MNTA, MONT, MOS, MPW, MSO, MVIS, MWIV, NRG, NTI, NUS, ODP, OXF, PDCE, PQ, PRIM, RDC, RHP, RTI, OTC:RTRX, STWD, TDG, TGH, TPH, TW, UBS, VMC, VSH, VTG, WCG, WNR, XRAY, ZBRA, ZTS

Notable earnings after Tuesday’s close: ACLS, AFG, AGU, ALL, AMTG, ARC, ARRS, ATVI, AVNR, AVNW, AWR, BEAT, BID, BIO, CENT, CHUY, CNVR, CODE, CPT, CSU, CYH, CYNI, DDR, DIS, DLR, DPM, DTLK, EA, EGAN, ENPH, ETE, ETP, EXTR, FEYE, FMC, FNGN, FRGI, FSLR, FST, FTR, GALE, GHDX, GNC, GNMK, GRPN, IAG, ICUI, IMI, JIVE, LBTYA, LGCY, LLNW, LYV, MCHP, MITT, MOVE, MPO, MRO, MTDR, MYGN, NYMT, OCLR, OKE, OKS, PBPB, PEGA, PSEC, PXD, PZZA, QGEN, QUAD, RDN, REGI, RGP, RLOC, RP, SAAS, SAPE, SGMO, SPA, SSNI, SXL, THOR, THRX, TRIP, TRMB, TRMR, TSRA, WES, WFM, WTI, ZAGG, ZU