Expectations are running high that Governor Mark Carney could shave 25 basis points off the Bank of England's base rate today and/or boost its bond-buying program to ward off a Brexit recession. Sterling is rallying ahead of the announcement, holding above $1.32, while world equities trade higher. An interest rate cut to 0.25% would be the BoE's first after seven steady years and represent an unprecedented low in the central bank's 322-year history.

Economy

In the meantime, Theresa May is readying her Brexit team: Freshly appointed Chancellor of the Exchequer Philip Hammond said the country will move swiftly to set broad goals for its new relationship with the EU. Former London Mayor Boris Johnson has been appointed as foreign secretary, fellow Brexiteer David Davis will be May's Brexit "Tsar," while former Defense Secretary Liam Fox has been handed the job of establishing new trade links.

The U.S. economy shouldn't sustain much damage from the Brexit vote and may warrant as many as two interest-rate increases before the end of the year, said Philly Fed President Patrick Harker, slightly downgrading his forecasts. Harker feels Q1 U.S. economic weakness was largely due to seasonal adjustments, and predicted inflation would hit a 2% target in 2017 and the Fed would raise rates toward 3% by the end of 2018.

Pokemonetary policy? Japanese stocks and the yen have been pushed about today by conflicting media reports that stated officials around Prime Minister Shinzo Abe are considering helicopter money and perpetual bonds. The rumors likely came about due to Ben Bernanke's visit to Tokyo this week. Although, the BOJ's July 29 policy decision is more than a fortnight away, it's already stirring immense speculation.

A rebound in manufacturing and services helped Singapore's economy grow in Q2 by the most in five quarters. GDP expanded by 2.2% Y/Y in the three months to June 30, up from the upwardly revised 2.1% pace in the first quarter. The figure was enough to blow out the Singapore Exchange. Not really, but equities trading was halted for most of the day due to a series of technical glitches.

U.S. Secretary of State John Kerry will meet with Vladimir Putin in Moscow today to set out a potential deal for averting an escalation of fighting in Syria's civil war. According to several sources, he'll offer to share military information for targeting Islamic State and the Nusra Front, in return for Russian assurances that President Bashar al-Assad's forces will stop bombing rebels who’ve signed up to a cease-fire.

Stocks

The "Pokemon GO" craze has spread to Europe, where the augmented-reality game is available for download in Germany. It is now one of the most viral mobile apps in history, outpacing Twitter (NYSE:TWTR) in terms of daily users (over 65M in the U.S.) and with people spending more time in the game than on Facebook (NASDAQ:FB). The Pokemon fever is giving Nintendo (OTCPK:NTDOY) a lift again today, with shares up another 16%.

Kicking off the bank earnings season, JPMorgan (NYSE:JPM) will release second-quarter results this morning. Wells Fargo (NYSE:WFC), Citigroup (NYSE:C) and U.S. Bancorp (NYSE:USB) report on Friday. Investors will be closely listening for comments regarding Brexit impacts on the banking industry and how a deeper economic slowdown in Europe will affect American institutions.

The Obama administration's plan to prevent tax inversions is coming under fire from companies and banks that say it would be costly and cumbersome. At issue are proposed regulations to combat "earnings stripping," a key goal for companies that carry out tax-avoiding mergers to reincorporate. The Treasury Department is scheduled to hold a public hearing today on the proposed changes.

An unsurprising suitor when it comes to U.S. movie assets, Dalian Wanda has held talks with Viacom (VIA, VIAB) about potentially taking a 49% stake in Paramount Pictures. Executives at Paramount, including Brad Grey, are reportedly in favor of the deal to raise cash, but the studio's major shareholder, Sumner Redstone, is understood to be against the transaction. If it goes ahead, the sale could value Paramount at between $8B-$10B.

BASF has declined to comment on a report Monsanto (NYSE:MON) is looking into a series of possible deals, including the potential acquisition of its agrochemicals unit. The news comes after Monsanto rejected a buyout offer from a different Germany company - Bayer (OTCPK:BAYRY) - back in May. BASF (OTCQX:BASFY) shares are in the green this morning, up 3% in Frankfurt, but the wider DAX is on the march higher too.

Counting on food sales to help maintain growth, Starbucks (NASDAQ:SBUX) is investing in an Italian bakery and plans to expand it with new locations. The world's biggest coffee-shop chain is buying a stake in Princi, which sells pastries, pizza and pasta in Europe, and will also act as a global licensee of the Italian company, helping it to expand globally. Financial terms of the deal weren't disclosed.

California regulators have again rejected Volkswagen's (OTCPK:VLKAY) plan to fix diesel vehicles that were programmed to cheat on air pollution tests, saying the idea was "incomplete" and "substantially deficient." The proposal would have covered about 16,000 3.0 liter diesel cars for model years 2009 to 2016. About 85,000 VW 3-liter diesel vehicles that cheat on emissions are on roadways nationwide.

Tesla has ended a program that guaranteed the resale value of its cars and lowered the starting price of its Model X crossover. The discontinuation of the buyback program, as of July 1, allows the automaker to free up cash that had been set aside to repurchase Model S cars after three years (at a value of at least 50% of the base purchase price). A Tesla (NASDAQ:TSLA) spokesperson said the decision was made in order "keep interest rates as low as possible and offer a compelling lease and loan program to customers."

The failure of Congress to approve any money to help fight Zika is "simply inexcusable" and a "dereliction of duty," senators said during a hearing on Wednesday, just two days before a long break that could mean no money before autumn. Statistics: Almost 600 cases have been reported among pregnant women in the U.S., with seven infants being born with microcephaly, the disturbing birth defect that's become the hallmark of the Zika virus infection. Related tickers: SNY, INO, AEMD, XON, CEMI, BCRX, TMO, OTCQB:GOVX

Teva Pharmaceutical will raise between $20B-$25B next week to finance its acquisition of Allergan's (NYSE:AGN) generics business, Globes reports. The bond offering is aimed at foreign investors. TEVA in October said it would sell $22B of bonds, mostly dollars but also euro and pounds, in a number of markets to help fund the deal. TEVA +1.2% premarket.

Tencent is boosting its stake in China Music Corp. to about 60% from 16%, in a deal that values the firm at roughly $2.7B. The agreement will turn China's biggest social-networking and entertainment company into a clear market leader of online music, bringing together the country's top-three mobile music apps. CMC owns Kugou and Kuwo, while Tencent (OTCPK:TCEHY) operates QQ Music.

EU antitrust chief Margrethe Vestager has announced a new round of charges against Google (GOOG, GOOGL), claiming that some of the company's advertising products restricted consumer choice. The new charges relate to some of the technology giant's online advertising tools — the main engine for Google’s $75B in annual revenues — and parts of the company’s search business linked to online shopping.

Wednesday's Key Earnings

CSX Corp. (NASDAQ:CSX) +1% AH after topping expectations.
Yum! Brands (NYSE:YUM) +3.1% AH boosting its profit forecast.

Today's Markets

In Asia, Japan +1% to 16385. Hong Kong +1.1% to 21561. China -0.2% to 3054. India +0.5% to 27942.
In Europe, at midday, London +0.9%. Paris +1%. Frankfurt +1.4%.
Futures at 6:20, Dow +0.8%. S&P +0.8%. Nasdaq +0.7%. Crude +1.2% to $45.29. Gold -1% to $1329.80.
Ten-year Treasury Yield +3 bps to 1.5%

Today's Economic Calendar

8:30 Initial Jobless Claims
8:30 Producer Price Index
9:45 Bloomberg Consumer Comfort Index
10:00 Fed's Bullard speech
10:30 EIA Natural Gas Inventory
11:15 Fed's Lockhart speech
1:15 PM Fed's George: U.S. Economy
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
7:00 PM Fed's Kaplan: Monetary Policy