Economy
The European Commission is preparing an investigation examining the low tax rates global companies pay in Ireland, Luxembourg and the Netherlands. The probe will make known if their tax deals are allowed under EU law, or amount to illegal state aid. The probe comes after yesterday's news that Apple used Irish tax laws to allow it to pay just a 3.7% tax rate on non-U.S. income during its last fiscal year.

Seven U.S. senators have urged the Department of Transportation to finally ban the use of electronic cigarettes on domestic flights and those to or from the United States. The ban for "vaping" on U.S. flights was proposed in September 2011. Although many airlines have prohibited the use of e-cigarettes, federal law still allows them to be used during flights.

Gazprom has extended the deadline for Ukraine to start paying in advance for natural gas to next Monday, amid the EU-brokered deal to avoid a cutoff of supplies. The talks will continue later today, as Ukraine attempts to alter its 2009 contract with Gazprom (OTCPK:OGZPY) by lowering the price it pays per cubic meter and undoing a clause to buy a set volume of gas per period.

Stocks
Alibaba has bought its way into the U.S. market, with the launch today of 11Main.com. The website is the first direct-to-consumer online shop for the company in the United States, and has been developed by two of Alibaba’s (ABABA) wholly owned American subsidiaries. The website will function similar to Alibaba’s China-based TMall, which offers virtual store fronts to merchants who set their own prices and handle their own logistics.

Due to building pressure, eBay is starting to move away from auctions, with the launch of its new online designer shop. The new website will operate as an extension to its other e-commerce platforms, and sell 16 fashion labels at full price. eBay's (EBAY) new e-commerce store will be named Designer Collective, and feature brands such as Calvin Klein, True Religion, Rebecca Minkoff and Nicole Miller.

Airbus has received a major blow after Dubai's Emirates airline cancelled its entire purchase of 70 Airbus (OTCPK:EADSF) A350 jets. The cancellation also stung engine maker Rolls-Royce (OTCPK:RYCEY), the sole engine maker for the A350. The deal, which closed in 2007, was worth around $16B ($22B based on the current price catalog). Rolls-Royce commented that the cancellation will result in a £2.6B ($4.4B) loss from its order book.

Bank of America and the DOJ have reached an impasse in their settlement deal regarding the sour mortgage investments the bank sold before the financial crisis. On Monday, Bank of America (BAC) offered more than $12B to settle claims and the federal investigation, although it appears that the DOJ is seeking a higher amount. BofA then sought to continue negotiations yesterday, although the DOJ moved towards completing its civil complaint against the bank.

U.S. government-related holdings in the Pimco Total Return Fund (ETF: BOND) were raised to 50% in May, up from 41% in April. Mortgage holdings were increased to 22%, from 19% the previous month. U.S. credit holdings for the fund were lowered to 11% in May from 12% in April, while the ETF displayed -9% money market and net cash exposure, from 5% the previous month.

Toyota is recalling about 650k cars in Japan due to defective airbags made by Takata (OTCPK:TKTDY). This expands a prior recall involving 2.14M vehicles in April 2013. The additional 650k Toyota (TM) vehicles have been announced today since the serial numbers Takata provided last year were incomplete. The defect involves a problem with the airbag inflator, which could possibly explode and injure the driver or passengers. Honda and Nissan are now examining if their vehicles contain the malfunction.

To add to the auto woes, GM CEO Mary Barra has told shareholders that the company will likely provide an estimate of the financial fallout from its ignition switch recall by early next month. GM will begin accepting claims from victims on Aug. 1; estimates for the potential amount paid to compensate victims, legal fees and any settlements or judgments have ranged from less than $5B to as much as $7B.

Today's economic calendar:

7:00 MBA Mortgage Applications
10:00 Quarterly Services Report
10:30 EIA Petroleum Inventories
1:00 PM Results of $21B, 10-Year Bond Auction
2:00 PM Treasury Budget

Notable earnings before today's open: HRB, MDCI

Notable earnings after today's close: DDC, RH, SIGM