Three of the biggest U.S. department store operators, Macy's (NYSE:M), Kohl's (NYSE:KSS) and Nordstrom (NYSE:JWN), are expected to issue healthier second-quarter reports today compared with their dismal Q1 results. Warm weather in June and July is expected to have helped them sell apparel, a weak category over the past few quarters. Macy's profit is also expected to get a boost from real estate deals.

Economy

The world will consume less oil next year than previously thought due to a "dimmer macroeconomic outlook," the IEA said in its monthly oil market report. The energy watchdog expects global oil demand to grow by 1.2M barrels per day in 2017, a decrease of 100K bpd compared with last month's forecast. Adding to the recent pressure on crude prices, EIA data on Wednesday showed a U.S. crude inventory build of 1.1M barrels last week, while Saudi Arabia said its output hit a record high in July.

Appetite for gold is showing no signs of abating, as figures from the World Gold Council revealed record investment demand (1,064 tons) in the first half of 2016. The trend for ETFs to pile in to the precious metal sent the price of gold soaring by 25% in H1, the biggest price rise since 1980. And for the first time ever, investment, rather than jewelry, was the largest component of gold demand for two consecutive quarters.

Despite having a range of monetary levers at its disposal, China's central bank is taking a careful and considered approach to using them. Market speculators betting on more monetary easing in 2016 "will probably be disappointed," state media Xinhua said in an editorial late Wednesday, as it would "dampen efforts to reduce overcapacity and remove asset bubbles." The editorial was Xinhua's second this week saying new rate cuts this year are unlikely.

Today also marks the first anniversary of the so-called "one-off devaluation of the yuan". On this date last year, China's central bank cut its guiding rate for the national currency by around 2% against the dollar, a move that sent shockwaves through markets. The PBOC has since continued to incrementally weaken the yuan, with the currency depreciating by around 7% against the greenback over the past 12 months.

Germany is planning a string of new security measures, that could go as far as scrapping dual citizenship and banning the burqa. It's in response to public concern over two attacks claimed by ISIS and the mass shooting last month carried out by a German-Iranian teenager. Interior minister, Thomas de Maiziere, will outline an initial plan today, which will include some 27 measures meant to increase safety and security around the country.

Vladimir Putin has promised to respond to what he called Kiev's "terror" tactics in Crimea, raising the stakes as fighting between Ukrainian government forces and Russian-backed rebels intensifies in the country once again. With two servicemen killed in clashes this week, the Russian leader has threatened to cancel the peace negotiations at next month's G20 meeting and called the talks "pointless."

New York City's economy slowed in Q2 with drops in job creation and personal income tax revenues contributing to the slowest pace of activity since the end of 2013. "This report confirms that our recovery is no longer gaining steam," NYC Comptroller Scott Stringer said in a statement. The 1.7% increase in gross city product still managed to outpace overall U.S. GDP, where the advance second quarter figure showed a 1.2% increase.

Wall Street bonuses are expected to decline this year for both bankers and traders as new regulations on trading and capital curb profits. Year-end compensation will be down 5-15% for investment bankers that advise on M&A, according to a widely followed report by Johnson Associates. Bankers who help companies raise equity and debt could see their compensation drop as much as 25%, while stock and bond traders could see a fall of as much as 15%.

Hillary Clinton plans to deliver a speech this afternoon that's expected to be a counter-punch to Donald Trump's economic address earlier this week at the Detroit Economic Club. The Democratic presidential candidate is scheduled to speak at Futuramic Tool & Engineering, a Warren-based company that manufactures tooling for the auto, aircraft, aerospace and defense industries.

Stocks

The founder and chief of Google Ventures, Bill Maris, is leaving the venture capital firm, Recode reports. He'll be the third high-ranking executive to depart from an Alphabet (GOOG, GOOGL) unit in recent months, as the tech giant continues to stumble through the transition into its new corporate structure. Sources say Maris will be replaced by GV managing partner David Krane, effective Friday.

A federal judge in San Francisco has dismissed a lawsuit accusing Twitter (NYSE:TWTR) of providing material support to ISIS that contributed to the deaths of two Americans in Jordan last November. "As horrific as these deaths were... Twitter cannot be treated as a publisher or speaker of ISIS's hateful rhetoric and is not liable under the facts alleged," he wrote of his decision.

Glencore reported a significant fall in output for most of its products in the first half of the year after closing mines in response to a rout in prices. Production of copper, which made up most of its revenue, dropped 4% while coal saw a 14% decline and zinc a 31% tumble. Glencore (OTCPK:GLNCY) also increased its full-year estimate for copper output due to strong performance from its Collahuasi mine and trimmed its coal prediction.

Looking to escape onerous pipeline contracts, Chesapeake Energy (NYSE:CHK) has agreed to give away its Barnett Shale holdings to First Reserve Corp.-backed Saddle Operating, exiting the birthplace of the shale revolution. As part of the deal, Chesapeake will also exit its transportation agreements with Williams Partners (NYSE:WPZ), saving $1.9B over the life of the contracts. CHK +7.5% premarket.

Australia's government has preliminarily blocked Chinese and Hong Kong bidders from taking a controlling stake in the country's largest electricity network, citing worries over national security. State Grid Corp. and Cheung Kong Infrastructure Holdings (OTCPK:CKISY) were attempting to buy a 50.4% stake in Ausgrid, in a deal that was expected to be worth about A$10B ($7.6B).

The Obama administration is planning to eliminate certain barriers to marijuana research as part of a policy that would potentially catalyze more studies of the drug's medical functions. The government is expected to announce the new policy decision today, but has still declined to change marijuana's classification from its current status as a dangerous substance with no medical use. Related tickers: OTC:AEGY, OTCQB:CNAB, OTCPK:ERBB, OTCPK:GRNH, OTCPK:HEMP, OTCPK:HPNN, OTCPK:LATF, OTCPK:MJNA, OTCPK:PLPL, OTCQB:VAPE, OTCPK:VAPR, VPCO

Federal prosecutors are investigating whether Valeant Pharmaceuticals (NYSE:VRX) defrauded insurers by shrouding its ties to the Philidor mail-order pharmacy that boosted sales of its drugs. The relationship between the two has been under scrutiny since last October, but Dow Jones says the new criminal probe is based on an unusual legal theory and could lead to criminal charges against former Philidor executives and Valeant as a company. VRX -9% premarket.

Brazilian telecom Oi will present a plan to overhaul its business and repay creditors later this month or by early September, according to CEO Marco Schroeder. The plan will include a debt-for-equity swap for suppliers and creditors. Oi (NYSE:OIBR) filed in June for Brazil's biggest-ever bankruptcy, seeking protection to restructure $21B in debt.

In another victory for broadband Internet providers, a federal appeals court has ruled in favor of Tennessee and North Carolina, which were attempting to set limits on municipal broadband networks. The FCC had sought to pre-empt state laws that put heavy restrictions on cities' rights to build and expand their own high-speed networks, a move that would've reduced demand from private-sector Internet service providers. Related tickers: VZ, T, CMCSA, S, TMUS, WIN, CTL, FTR, CHTR, CCOI

The chief executive of Delta Air Lines has taken full responsibility for the computer failure that forced the airline to cancel more than 2,100 flights over three days, but said it was a one-time event. There is "nothing endemic" in the meltdown that started at the airline's Atlanta headquarters Monday morning "to make us believe we're at risk," Ed Bastian said in an interview. "This is an incident." DAL +1.5% premarket.

Wednesday's Key Earnings

JD.Com (NASDAQ:JD) +4.7% after strong Q2 earnings.
Michael Kors (NYSE:KORS) -2.8% on slumping same store sales.
Shake Shack (NYSE:SHAK) -9.9% AH on slower comparable sales growth.
Silver Wheaton (NYSE:SLW) hardly moved AH following in-line results.

Today's Markets

In Asia, Japan -0.2% to 16735. Hong Kong +0.4% to 22581. China -0.5% to 3002. India +0.3% to 27859.
In Europe, at midday, London -0.3%. Paris +0.7%. Frankfurt +0.6%.
Futures at 6:20, Dow +0.3%. S&P +0.2%. Nasdaq +0.3%. Crude -0.3% to $41.58. Gold -0.1% to $1350.
Ten-year Treasury Yield +1 bps to 1.51%

Today's Economic Calendar

8:30 Initial Jobless Claims
8:30 Import/Export Prices
9:45 Bloomberg Consumer Comfort Index
10:30 EIA Natural Gas Inventory
1:00 PM Results of $15B, 30-Year Note Auction
4:30 PM Money Supply
4:30 PM Fed Balance Sheet