The key event for today is the ECB meeting in Frankfurt, where the central bank will deliver its first policy decision since extending the run of QE in December. Since then, eurozone inflation has risen sharply, while Germany has called for the bank to bring its ultra-accommodative bond buying to an end. No changes are expected at a rate decision due at 7:45 a.m. ET, but markets will be closely watching Mario Draghi's press conference 45 minutes later.

Economy

"At my core I think we're going to be OK," President Obama said as he concluded his final news conference at the White House. "We just have to fight for it, work for it, and not take it for granted." Obama also said he would avoid weighing in on specific policy matters during his post-presidency, but listed several political and social issues that would lead him to speak out.

The federal control board overseeing Puerto Rico's finances might accept a revised fiscal plan by Feb. 28 and extend a debt moratorium until May 1, which would give the U.S. territory more time to negotiate restructuring deals. Both requests will be taken up "later this month," but would be conditioned on the government agreeing to turn over more financial information and not taking on extra liquidity loans.

Fed Chair Janet Yellen woke up the bond market late Wednesday with a surprisingly hawkish stance, and now traders are looking forward to today's testimony from Donald Trump's Treasury nominee. With only one day left before the inauguration, comments from Steven Mnuchin about the dollar and Treasury will be of interest, as well as remarks about China and its currency.

"The U.K. will step up to a new leadership role as the strongest and most forceful advocate for free markets and free trade anywhere in the world," British PM Theresa May told the World Economic Forum in Davos. Her tone was strikingly different from the speech she made to her Conservative Party conference in October, when she criticized those who see themselves as "citizens of the world."

The International Energy Agency believes that global oil markets were tightening even before cuts promised by OPEC and non-OPEC producers kicked in. While it is "far too soon" to gauge OPEC members' levels of compliance with promised cuts, the IEA said oil stocks in the developed world fell for a fourth consecutive month in November, although they remained more than 300M barrels above the five-year average.

Stocks

A South Korean court has dismissed a warrant to arrest the head of the Samsung Group, amid a graft scandal that led to the impeachment of President Park Geun-hye. The decision is likely to come as a major relief for the country's largest conglomerate and Lee Jae-yong, who has tried to fill the vacuum in the group's leadership since his father suffered a heart attack in 2014.

Panasonic aims to extend its partnership with Tesla Motors (NASDAQ:TSLA) beyond batteries, as the Japanese conglomerate continues to shift its focus to the automotive business. "We are deeply interested in Tesla's self-driving system," Panasonic (OTCPK:PCRFY) CEO Kazuhiro Tsuga declared. "We are hoping to expand our collaboration by jointly developing devices for that, such as sensors." TSLA +2.8% premarket.

In his first public appearance since being forced to resign 16 months ago, Volkswagen (OTCPK:VLKAY) CEO Martin Winterkorn apologized for breaching the trust of millions of customers, while claiming he didn't know about Dieselgate. "It's incomprehensible why I wasn’t informed early and clearly," he said before a parliamentary committee in Berlin. "I would have prevented any type of deception or misleading of authorities."

Takata shares closed down 17% in Tokyo on reports that bidders Autoliv (NYSE:ALV) and Key Safety Systems have proposed Japanese court involvement in the troubled air bag maker's debt restructuring. Takata (OTCPK:TKTDY) last week admitted to hiding the deadly risks of its inflators for about 15 years and agreed to plead guilty in the U.S. to one criminal charge as part of a $1B settlement.

Becoming a major sponsor of the Olympics, Alibaba (NYSE:BABA) has signed a deal with the International Olympic Committee - that runs until 2028 - to provide cloud and e-commerce services. No financial details were disclosed, but IOC sources have previously told Reuters that major sponsors pay about $100M per four-year cycle, which includes one summer and one winter game.

We are pleased to have "put this legacy matter" behind us, Credit Suisse (NYSE:CS) declared, after agreeing to a $5.3B settlement with the DOJ over toxic crisis-era mortgages. The news comes just days after Deutsche Bank (NYSE:DB) reached a deal with the U.S. authorities. Barclays (NYSE:BCS) is also in talks with the DOJ over the mis-selling of MBSs, but it hopes for a "fair settlement" that correctly reflects the agreements made between the U.S. banks and officials.

A bigger Brexit exodus? Goldman Sachs (NYSE:GS) is considering halving its London staff, and may move 1,000 workers to Frankfurt because of concerns over Britain's vote to leave the EU, Handelsblatt reports. Yesterday, UBS said that about 1,000 of the bank's 5,000 employees based in London may be affected by Brexit, while HSBC announced it could relocate 1,000 staff to Paris.

Netflix added over a third more subscribers than anticipated in the last quarter of 2016, a sign of success for its ambitious global expansion that sent its shares up 7.5% in extended trading. Netflix (NASDAQ:NFLX) signed up 7.1M new subscribers globally, well above its own expectations of 5.2M, marking its largest-ever quarterly subscriber growth in its history.

Highlighting the latest effort to streamline its business, Twitter (NYSE:TWTR) has sold a unit to Google (GOOG, GOOGL) that runs a tool for developers to make mobile apps. The messaging service said it launched the unit, called Fabric, in 2014 and it is now used by more than 580K mobile developers. The Fabric team is moving to Google, though Twitter declined to say how many employees that included.

5G mobile internet technology marks the beginning of the "fourth industrial revolution," Turkcell (NYSE:TKC) CEO Kaan Terzioglu told CNBC. He also said the telecom completed a test in partnership with Ericsson (NASDAQ:ERIC) this week, using the next-generation internet. 5G is largely viewed as a medium that can support the industrial and "Internet of Things" space, while 4G revolutionized the consumer market.

The global head of pharmaceuticals at GlaxoSmithKline (NYSE:GSK), Abbas Hussain, is leaving the company and will be replaced by Luke Miels from AstraZeneca (NYSE:AZN). Hussain had been seen as a potential contender to take over from CEO Andrew Witty, who steps down at the end of March, but the job went to Glaxo's consumer health division boss Emma Walmsley.

Martin Shkreli... whistleblower? The Federal Trade Commission has settled charges against Mallinckrodt (NYSE:MNK) for allegedly creating a monopoly to jack up the price of a drug used to treat infant spasms by 85,000% since 2001, to $34,000 a vial. The twist: the FTC launched the probe shortly after the "pharma bro" filed suit in 2014 alleging anticompetitive tactics by Questcor, a drug company that Mallinckrodt now owns.

BHP Billiton and Vale have struck a preliminary agreement with Brazilian prosecutors, which lays out a path for a future settlement of the largest legal claim emanating from the Samarco dam failure. BHP and VALE will provide an interim security of 2.2B reals ($681M) to support a series of programs, including the appointment of experts to advise prosecutors on the social and environmental impacts of the disaster.

Toshiba could post a ¥700B ($6.1B) loss at its U.S. nuclear reactor business, much bigger than the ¥500B it had earlier flagged to investors, sources told the Kyodo news agency. Shares in Toshiba (OTCPK:TOSYY) plunged 16% in Tokyo on the report, which comes a day after the company said it was considering a spinoff of its chip business to cover financial shortfalls.

The U.S. government's bankruptcy watchdog has objected to certain parts of Peabody Energy's (OTCPK:BTUUQ) plan to slash $5B of debt and exit Chapter 11, calling a proposed $240M in transaction fees "exorbitant." At a court hearing in St. Louis today, Peabody shareholders will seek to be part of a reorganized company, while the U.S. Trustee's objections will be heard at a hearing on Jan. 26.

Overcoming heated objections from a group of U.S. creditors, Hanjin Shipping (OTC:HNJSF) has received the green light for the $78M sale of its stake in a Long Beach, Calif., container terminal operator. "My decision is to approve the sale," U.S. Bankruptcy Judge John Sherwood said, adding he would approve the transfer of the sale's proceeds to South Korea.

The uppermost layer of Israel's three-tier missile shield has become operational, with the first advanced rockets delivered to the Israeli Air Force. The Arrow 3 system, developed by Israel Aerospace Industries and Boeing (NYSE:BA), is designed to strike targets outside Earth's atmosphere. Such high-altitude shoot-downs are meant to safely destroy incoming nuclear, biological or chemical ballistic missiles.

Creating the world's third-biggest aerospace supplier, French aero engine maker Safran (OTCPK:SAFRY) has agreed to buy seats manufacturer Zodiac Aerospace (OTCPK:ZODFY) for €8.5B. The move comes only three months after Rockwell Collins (NYSE:COL) agreed to pay $6.4B to acquire Zodiac's chief rival, B/E Aerospace (NASDAQ:BEAV), in a deal that would unite two of the other largest aerospace suppliers.

The U.S. Department of Defense and Lockheed Martin (NYSE:LMT) are close to a deal for a contract worth almost $9B as negotiations are poised to bring the price per F-35 below $100M for the first time. According to Reuters, talks are still ongoing for the tenth batch of stealth fighter jets with a deal for 90 planes expected to be announced by the end of the month.

Wednesday's Key Earnings

Canadian Pacific (NYSE:CP) -1.2% AH with its CEO stepping down early.
Citigroup (NYSE:C) -1.7% as revenues fell short of estimates.
Goldman Sachs (GS) -0.6% with strong results already priced in.
Kinder Morgan (NYSE:KMI) -2% AH on another drop in quarterly revenues.
Netflix (NFLX) +7.5% AH dazzling with subscriber growth.
U.S. Bancorp (NYSE:USB) +0.5% after beating expectations.

Today's Markets

In Asia, Japan +0.9%. Hong Kong -0.2%. China -0.3%. India +0.2%.
In Europe, at midday, London -0.5%. Paris -0.2%. Frankfurt -0.1%.
Futures at 6:30, Dow -0.1%. S&P -0.1%. Nasdaq -0.1%. Crude +0.6% to $52.21. Gold -0.8% to $1202.30.
Ten-year Treasury Yield +5 bps to 2.43%

Today's Economic Calendar

8:30 Housing Starts
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
9:45 Bloomberg Consumer Comfort Index
10:00 Fed's Williams Speech
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
8:00 PM Janet Yellen speech