A federal judge has blocked the planned tie-up of Staples (NASDAQ:SPLS) and Office Depot (NASDAQ:ODP) due to competition concerns, prompting the office-supply chains to abandon their roughly $6B deal. "We are disappointed by this outcome and strongly believe that a merger would have benefited all of our customers in the long term," said Office Depot CEO Roland Smith. Staples will now pay a $250M break-up fee to its smaller rival for terminating the transaction. SPLS -10%; ODP -26% in AH trading.

Economy

Bernie Sanders defeated Hillary Clinton in West Virginia's primary on Tuesday, winning over voters deeply skeptical about the economy. The loss slows Clinton's march to the nomination, but she is still heavily favored to become the Democratic presidential nominee. Donald Trump, who secured the Republican contests in West Virginia and Nebraska, will meet with heads of the GOP in Congress tomorrow, as party leaders doubt his substance and style.

The dollar is stumbling again, succumbing to a bout of profit-taking as U.S. futures point to a fall of around a third of a percent on Wall Street. The move comes after Goldman Sachs called the greenback's bottom (again), stating it "remains dollar bullish and thinks the trajectory is higher from here." The U.S. Dollar Index -0.2% to 94.05, easing back from Tuesday's two-week high of 94.15.

Companies around the world are using the United States as an excuse to avoid trade with Iran, Secretary of State John Kerry announced, as he declared the Islamic Republic "open for business" for European banks. The comments arrive as the U.S. works to address Tehran's complaints that it hasn't received the sanctions relief it was promised in exchange for rolling back its nuclear program.

As the Puerto Rican debt crisis continues to unfold, mutual fund managers have been busy trimming their holdings to reduce exposure to the commonwealth's crisis. Over the past year, the number of funds with exposure to the island has been pared to 29 - out of a pool of 562 municipal bond funds - from as many as 48 in June 2015, according to data from Morningstar. Total dollar exposure has been cut as well, from about $9.9B last summer to $6.3B now.

Brazil's Senate is set to vote on whether to put President Dilma Rousseff on trial for breaking budget rules, amid expectations she will become the country's first leader in more than two decades to be removed from office. If her opponents garner a simple majority of the 81 senators, Rousseff will be suspended for up to six months during the trial and Vice President Michel Temer will take power. A final vote is expected to take place around 7 p.m. ET.

Canadian oil sands companies near Fort McMurray are beginning to restart their operations, as the out-of-control wildfire continues to rage but has now moved far enough away from the oil sands' sites to allow them to return. Royal Dutch Shell (RDS.A, RDS.B) is the first firm to turn on its operations, resuming production at its Albian mine. Before Shell's restart, the total decline to output in the area reportedly reached at least 839K bbl/day, or close to one-third of Canada's overall daily production. Crude futures -1% to $44.23.

Stocks

Hit by a sharp appreciation in the yen, Toyota (NYSE:TM) is predicting net income to drop 35% to ¥1.5T ($13.8B) for the fiscal year ending in March, snapping three straight years of record profit. "Our earnings over the past several years have been boosted by [favorable] exchange rates," President Akio Toyoda said. "But we recognize that this trend has changed significantly." Toyota also stated it would repurchase as much as ¥500B ($4.6B), or about 3.2%, of its stock and pay a dividend of ¥210 per share.

Takata swung to a full-year net loss of ¥13.1B ($120.5M), dragged down by an increase in costs for recalls of its potentially deadly airbag inflators. The loss for the year ended in March, in line with estimates given earlier this week, was the firm's third in the past four financial years. Takata (OTCPK:TKTDY) also appointed a team of five experts to help with its restructuring plan which it hopes to have in place by the fall.

Tesla is warning of production risks associated with the Model 3, the mass-market sedan the electric car maker expects to begin building within the next 18 months. "We have no experience to date in manufacturing vehicles at the high volumes that we anticipate for Model 3," the company said in its quarterly financial report. Tesla (NASDAQ:TSLA) also cautioned that if one or more of its "many assumptions" turns out to be incorrect, its "ability to successfully launch on time and at volumes and prices that are profitable...may be materially and adversely impacted."

The U.S. Attorney's Office for the Southern District of New York is investigating contracts between drugmakers and pharmacy benefit managers. Federal prosecutors have approached at least three companies, including Johnson & Johnson (NYSE:JNJ), Merck (NYSE:MRK) and Endo International (NASDAQ:ENDP). When drugs are knocked off their formularies, patients may have to pay full price for them. PBMs often keep or dump a product depending on whether they can obtain favorable pricing.

Chipotle board members will be in the hot seat today, when shareholders fight to shake up the board at the burrito chain's annual meeting. Investors are weighing a proposal that would allow stakeholders owning 3% or more of the company's outstanding shares continuously for three years to nominate directors to the board; Chipotle (NYSE:CMG) is running a counter proposal that would set the threshold at 5%. CMG shares are down about 30% since October, after getting whacked with a series of E. coli and norovirus outbreaks.

A new marketing campaign from Anheuser-Busch InBev (NYSE:BUD) this summer will see bottles of Budweiser labeled "America" with the tag line of E Pluribus Unum replacing King of Beers. The patriotic theme from the beer company is well-timed, with the Summer Olympics and the heated U.S. Presidential election on the calendar. It also coincides with Budweiser losing market share in the U.S.

In the latest feud over the costs of processing payments, Wal-Mart (NYSE:WMT) has filed a lawsuit against Visa (NYSE:V) in which it accuses the company of preventing it from requiring debit card users to enter a PIN number when using a chip-enabled card. According to a person familiar with the rates, the dispute involves money: Wal-Mart pays Visa about five cents more per signature transaction than it does for those that use a PIN. The two have tangled frequently in different lawsuits over the last several years.

The head of the Ultimate Fighting Championship, the world's largest mixed martial arts organization, has denied a report stating the group was exploring a sale. "The ESPN story is overblown," said UFC president Dana White, adding that the facts "could not be further off." ESPN reporter Darrell Rovell previously said that interested bidders included Blackstone (NYSE:BX), WME/IMG, China Media Capital and the Dalian Wanda Group, and a winning bid was expected to be between $3.5B-$4B.

Marketo jumped almost 25% on Tuesday following chatter that is was exploring a possible sale. Credit Suisse believes SAP is the most likely acquirer, but according to Bloomberg, the company is speaking to both strategic companies and private equity firms. Marketo is a maker of cloud-based marketing software with a market capitalization of $1.2B.

LendingClub will not be able to file its first-quarter report in time following the resignation of CEO Renaud Laplanche, who left the firm due to an internal probe showing faulty lending practices. The company now plans to file the report on or prior to May 16. LendingClub's (NYSE:LC) shares have lost 42.3% of their value since Monday, when the company first announced the executive departure.

Android legal troubles hit Google... The search giant faced off against Oracle (NYSE:ORCL) in a retrial on Tuesday over whether it infringed the latter's copyrights for the Java code to develop Android in 2006. If the new jury rules against Google (GOOG, GOOGL) on fair use, then it will consider Oracle's $9.3B damages request. Meanwhile, Russia's antitrust authorities today are expected to fine Google for misusing its Android dominance. The Internet company denies any wrongdoing, but the possible penalty - up to 7% of the company’s annual revenue in Russia - comes a month after EU officials made similar allegations.

A U.S. Senate committee has launched an inquiry into how Facebook (NASDAQ:FB) selects its news stories following a report that company employees blocked news about conservative issues. "Facebook must answer these serious allegations and hold those responsible to account if there has been political bias in the dissemination of trending news," Chairman John Thune declared. Tom Stocky, whose team is responsible for Facebook's Trending Topics, said he has "found no evidence that the anonymous allegations are true."

Tuesday's Key Earnings

Allergan (NYSE:AGN) +5.1% authorizing up to $10B in share repurchases.
Credit Suisse (NYSE:CS) +4.2% on expense cuts and overall downsizing.
Disney (NYSE:DIS) -6.2% AH following its first earnings miss in 5 years.
Electronic Arts (NASDAQ:EA) +6.6% AH on a record year for revenue/profit.
Lumber Liquidators (NYSE:LL) -7.8% after heavily missing estimates.
Nokia (NYSE:NOK) -6.7% following weak earnings in Q1.
Sodastream (NASDAQ:SODA) +23.7% on double-digit sales growth.

Today's Markets

In Asia, Japan +0.1% to 16579. Hong Kong -1.2% to 20007. China +0.2% to 2837. India -0.7% to 25597.
In Europe, at midday, London -0.2%. Paris -1%. Frankfurt -0.8%.
Futures at 6:20, Dow -0.3%. S&P -0.3%. Nasdaq -0.3%. Crude -1% to $44.23. Gold +0.8% to $1274.50.
Ten-year Treasury Yield flat at 1.75%

Today's Economic Calendar

7:00 MBA Mortgage Applications
10:30 EIA Petroleum Inventories
1:00 PM Results of $23B, 10-Year Note Auction
2:00 PM Treasury Budget