Monsanto has finally agreed to a takeover offer from Bayer (OTCPK:BAYRY), sources say, valuing it at $128 per share or a total of more than $66B. The deal would be the largest all-cash transaction on record and put a quarter of the combined world market for seeds and pesticides under one roof. Bayer has also settled on a $2B break-up fee for the deal, which is expected to close by the end of 2017. MON +1.7% premarket

Economy

In his annual State of the Union speech, European Commission President Jean-Claude Juncker warned the EU was facing an "existential threat," but insisted that Brexit doesn't mean "the disintegration of the European Union." He also said the U.K. could not expect access to the EU's internal market without the free movement of people and called for an EU military with its own European headquarters, something Britain had long resisted.

Greece will tell creditors it cannot comply with labor reforms demanded by the IMF as a condition of its support for the country's third bailout, Labor Minister George Katrougalos told Reuters. At issue is a ban on the right of workers to negotiate wages and conditions on a collective basis. A breakdown with the IMF could jeopardize its financing of the €86B bailout and undermine overall confidence in the accord.

The BOJ plans to make negative interest rates the centerpiece of future monetary easing, promising to weigh further cuts as expansions to its already massive asset buying near their limits, the Nikkei reports. The central bank adopted the controversial policy in February to hit its 2% inflation target, but the move's unwelcome side effects have been a stronger yen and pressure on financial institutions from thinner margins.

The Obama administration is enlisting business leaders in a last-ditch effort to win Republican support for its signature Pacific trade agreement after the election. A business-led advisory committee known as the President's Export Council is expected to call on Congress today to pass the Trans-Pacific Partnership agreement in the "lame duck" session at the end of the year.

A new ceasefire in Syria brought a full day with no combat deaths in the war between President Assad and his opponents, as efforts to deliver aid to besieged areas got cautiously under way. The Syrian Observatory for Human Rights puts the death toll since the start of the conflict at abound 430K, in line with U.N. estimates. About 11M people have been made homeless, triggering a major refugee crisis.

Stocks

European officials will unveil new technology rules today aimed at reining in many of the world's largest tech firms. Under the proposals, which will take years to complete, European publishers may be given powers to charge internet companies whenever their content shows up in online results or other services. Chat apps will also be more heavily policed by extending rules which currently only cover telecoms providers. Related tickers: GOOG, GOOGL, FB, MSFT, ORAN, OTCQX:DTEGY, OTC:AXSPY

Alibaba is not looking to buy the remaining piece of Yahoo (NASDAQ:YHOO), which includes a large stake in the Chinese e-commerce giant, because it would face a hefty U.S. tax bill in order to do anything with those shares. "If there was an easy tax solution someone would have figured it out already," said Joseph Tsai, Alibaba's (NYSE:BABA) executive vice chairman. Buying back the stock "doesn't solve our tax problem" because it's still a U.S. corporation.

With plans to launch by the end of October, Facebook (NASDAQ:FB) and Twitter (NYSE:TWTR) have joined a network of over 30 companies to tackle fake news and improve the quality of reporting from social media. Google-backed (GOOG, GOOGL) First Draft Coalition will create a voluntary code of practice, promote news literacy among social media users, and establish a platform where members can verify questionable stories.

Two more ships operated by financially troubled South Korean shipper, Hanjin Shipping (OTC:HNJSF), have been put up for sale, with offers for the vessels being sought by the end of this month. The news follows the fire sale of three Hanjin bulk carriers to Singapore and Greek buyers for a total of almost $39M, according to data from ship valuation firm VesselsValue.

Volkswagen is still uncertain when or if it will bring diesel engines back to the U.S. car and light-truck market, but the company is not ruling it out. VW's (OTCPK:VLKAY) North America head Hinrich Woebcken told reporters that since U.S. emissions regulations are tightening, the automaker will focus on gasoline-powered cars and a gradual roll out of hybrid and all electric vehicles.

SpaceX hopes to start launching its rockets again in November, a mere three months after the company's Falcon 9 exploded on a launch pad at Cape Canaveral. But given the significant repairs needed for Launch Complex 40 - the site of the explosion - SpaceX's (Private:SPACE) next flight will likely take off from the Vandenberg Air Force Base or an alternate launch site at the Kennedy Space Center.

The drugmaker buffeted by the furor over its hefty EpiPen price increases had the second-highest executive compensation among all U.S. drug and biotech firms over the past five years, paying its top five managers a total of $292.1M, according to a WSJ analysis. The big pay packages are unusual because of Mylan's (NASDAQ:MYL) relatively small size in the U.S. drug industry, where it is No. 11 by revenue and No. 16 by market capitalization.

An independent panel to the FDA is expected to make a recommendation today on whether a serious warning about neuropsychiatric side effects associated with Pfizer's (NYSE:PFE) quit-smoking drug Chantix should be removed from its label. An 8,000 patient study has shown that the therapy doesn't significantly increase the incidence of suicidal thoughts, hostility and agitation. While the FDA is not obligated to follow the panel's recommendations, it typically does so.

Carl Icahn is asking regulators for the option to up his Herbalife (NYSE:HLF) stake to 50% and said the company would be "better off private" to rid itself of Bill Ackman and avoid some of the public scrutiny it has received. That would be a huge increase, since Icahn's currently limited to 35% of shares (he raised his Herbalife stake last month to 21%). HLF shares rose 2.4% AH in response.

More MegaBrew fallout... China Resources Beer Holdings (OTCPK:CRHKY) is considering a bid for SABMiller's (OTCPK:SBMRY) central and eastern European assets, valued at about $6B, sources told Bloomberg. A sale process for the assets, which include the brewer of Czech lager Pilsner Urquell, is expected to start next month after SABMiller's deal with AB InBev (NYSE:BUD) closes.

Facing two straight years of a profit and stock price decline, Viacom's (VIA, VIAB) revamped board will meet today to discuss strategic options. What's on the menu? The company's capital structure, dividend policy, exploring the recombination of Viacom and CBS, and the possibility of deals involving Paramount Pictures.

Wells Fargo CEO John Stumpf has apologized for the bank's alleged improper practices relating to account openings, but said he won't be resigning. Last week, the lender was fined $185M for opening 2M unauthorized bank accounts in order to fulfill sales targets. Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B), which has a 10% stake in Wells Fargo (NYSE:WFC), lost around $1.4B yesterday after the bank's shares fell over 3% during the session.

Without giving any further information, the board of America Movil (NASDAQ:AMOV) said it would propose delisting its shares from the Nasdaq and Latibex exchanges. The company will offer stockholders the choice to receive the second part of their ordinary dividend in cash or in shares.

When Apple unveiled its AirPod wireless earbuds, the big concern (besides their $159 price) was that they'd fall out and get lost. Looking to dispel those fears, Apple's (NASDAQ:AAPL) Tim Cook said even when he dances, they stay in place. "I've been on treadmills, walking, doing all the things you normally do," he told ABC, adding, "You know how earbuds are constantly getting caught on something? You never have that problem."

Walmart is working on a self-driving shopping cart that customers would be able to hail like an Uber (Private:UBER) – possibly through a smartphone app. Not only has the retailer filed a patent for a cart that has a motor and video cameras, but it would be able to return itself from customers' cars to the store. The system may also help Walmart (NYSE:WMT) manage inventory by scanning store shelves to ensure products are there.

Seeking to develop a fleet of autonomous vehicles, Uber's (UBER) self-driving car will begin accepting passengers in Pittsburgh today, although a specially trained employee will stay behind the wheel in case the system makes a mistake. For those really eager to get in one, you'll unfortunately need a special invite to try it out, which Uber says it's only sending to its "most loyal" customers. Rides for now will be free.

Today's Markets

In Asia, Japan -0.7% to 16614. Hong Kong -0.1% to 23190. China -0.7% to 3002. India +0.1% to 28379.
In Europe, at midday, London 0.7%. Paris +0.1%. Frankfurt +0.3%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.1%. Crude +0.5% to $45.10. Gold +0.2% to $1326.40.
Ten-year Treasury Yield -2 bps to 1.71%

Today's Economic Calendar

7:00 MBA Mortgage Applications
8:30 Import/Export Prices
10:30 EIA Petroleum Inventories