Four Arab states have cut off diplomatic ties with Qatar, as well as closing air and sea routes, pointing to Doha's ties to terrorism. The coordinated move by Saudi Arabia, Egypt, the UAE and Bahrain marks a sharp escalation of a rift between the Persian Gulf states since late last month. Crude prices initially rose, while the Qatari stock index plunged 7.3% on the heightened tensions.

Economy

Three knife-wielding men led a deadly rampage through London on Saturday night, plowing a van into pedestrians on London Bridge and stabbing multiple people nearby, before being shot dead by police. Seven people were killed and at least 48 were hospitalized in the terror attack (Britain's third in less than three months), which comes just days before a parliamentary election on June 8.

Underpinned by increasing demand, Markit's final composite PMI for the euro area was 56.8 in May, unchanged from both April's index and the earlier flash estimate. "The outlook for the eurozone economy seems to be tilting to the upside, and it seems likely that we'll start to see many forecasters' expectations for 2017 growth revised higher," said Chris Williamson, chief economist at Markit.

The World Bank has maintained its forecast for global growth in 2017 and 2018 at 2.7% and 2.9%, respectively, as manufacturing and trade pick up and confidence improves. It's supported by stronger demand from major advanced economies, increased trade flows to and from China, and a diminished drag from weak demand from commodity exporters.

Looking to reactivate its membership in the group, Indonesia has sent a letter to OPEC. "Yes, it's true," Energy and Mineral Resources Ministry spokesman Sujatmiko told Reuters, when asked to confirm the news. Indonesia's OPEC membership was suspended in December after the net oil importer said it could not agree to the group's proposed production cuts.

The Trump administration is concerned about any action by U.S. companies that provides a financial lifeline to Venezuela after Goldman Sachs (NYSE:GS) came under fire for purchasing so-called "hunger bonds." However, the bank said last week that it never transacted directly with Venezuelan authorities when it bought $2.8B of state oil firm PDVSA bonds for pennies on the dollar.

Stocks

Apple's Worldwide Developer Conference is only hours away, with the traditional keynote address from Tim Cook beginning at 10 a.m. PT. For the first time in years, Apple (NASDAQ:AAPL) will use the event to tout not just its software, but hardware too. It's expected to show off the latest iPads and Mac laptops and may even lift the cover on a smart speaker based off of Siri.

The successful opening of Wonder Woman this weekend could fuel shares of Time Warner (NYSE:TWX) to a 20% stock return over the coming year, according to Barron's. The film topped the U.S. box office with $100.5M, exceeding expectations and making it the best American debut for a female-directed movie. Barron's also believes Warner Bros. is in good shape with its upcoming schedule of releases.

Brace for the first major court challenge against a media company in the era of "fake news." Beef Products claims ABC (NYSE:DIS) slandered the company in 2012 by calling its ground-beef product "pink slime," leading to its removal from groceries, restaurants and cafeterias. The $5.7B suit, which opens today, also alleges that BPI had to close three of its plants and saw revenues drop 80% as a result of the defamation.

Now that Sinclair Broadcast Group has reached a deal to acquire Tribune Media (NYSE:TRCO) and create a local television giant, it's talking to one of Hollywood's most seasoned small-screen executives about joining the company. Steve Mosko, the former chairman of Sony (NYSE:SNE) Pictures Television, is in preliminary discussions with Sinclair (NASDAQ:SBGI) about a senior position that would expand its programming.

Amazon's stock closed at $1,006.73 on Friday, while Alphabet's Class A shares (NASDAQ:GOOGL) came within cents of the thousand mark last week, ending Friday at $996.12. Another race? Just a few dollars more on Amazon's (NASDAQ:AMZN) share price and the world will have a new richest man. Jeff Bezos, the company’s founder, is on the brink of overtaking Bill Gates to become the wealthiest person on the planet.

The annual auction for a lunch with Warren Buffett began Sunday evening and runs through Friday, with bids starting at $25K. The CEO of Berkshire Hathaway (BRK.A, BRK.B) has raised nearly $24M for the Glide Foundation, a nonprofit group that runs antipoverty programs in San Francisco, over the past 17 years. Last year's winner paid almost $3.5M, which tied the record set in 2012.

Ethereum, an alternative to bitcoin, hit a fresh record high on Sunday, amid continued interest in the digital asset space and increased trade from Asia. There's also been a surge in "initial coin offerings," which is a new way for cryptocurrency start-ups to raise money. According to CoinDesk, ethereum traded at $250.41, up 2,839% from the $8.52 handle it had on Jan. 1.

Quoting Chairman Terry Gou, the Nikkei said that Apple (AAPL) and Amazon (AMZN) will join Foxconn's (OTC:FXCOF) bid for Toshiba's (OTCPK:TOSBF) semiconductor business, which is valued at about $18B. The two U.S. technology giants plan to "chip in funds", but it was not immediately clear if that means a direct investment or financing for the transaction.

Another big deal? Blackstone (NYSE:BX) has offered to buy all shares in Finnish real estate investment company Sponda (OTC:SPOYY) for about €1.8B, as it seeks to expand its business in the Nordic region. On Friday, Blackstone agreed to sell European warehouse firm Logicor to China Investment Corp. for more than €12B in the biggest-ever private equity real estate deal in Europe.

Herbalife has raised its current-quarter adjusted profit forecast, expecting $0.95-$1.15 per share, compared with a previous forecast of $0.88-$1.08. However, the firm now expects revenues to be 1.5% lower than earlier estimates due to its transition to new FTC rules, which require it to make 80% of sales outside its distributor network, along with softness in Mexico. HLF -4.2% premarket.

The war against the U.S. sugar industry is coming to a head. Representatives from Coca-Cola (NYSE:KO), Archer Daniels Midland (NYSE:ADM) and Cargill met with White House official Ray Starling last month, warning against potential fallout if the U.S. and Mexico cannot agree to a new trade pact and avert large duties on American sugar imports from Mexico. The deadline for an agreement is today.

National insurer AAA is raising its rates on Tesla (NASDAQ:TSLA) vehicles by around 30% based on data showing that the Model S and X had abnormally high claim frequencies and costs of insurance claims compared with other cars in the same classes. "This analysis is severely flawed and is not reflective of reality," the EV automaker declared. "Among other things, it compares models that are not remotely peers."

Audi CEO Rupert Stadler only got a five-year contract extension last month because of an agreement among supervisory board members that he would not serve out his full term, Reuters reports. Munich prosecutors have been investigating Audi (OTCPK:AUDVF) on suspicion of fraud and criminal advertising in the U.S., where parent Volkswagen's (OTCPK:VLKAY) emissions scandal broke in September 2015.

Following the exit of many major airlines in recent years, United Airlines (NYSE:UAL) will end flights to Venezuela next month, further isolating the crisis-hit country from international travel. In addition to currency disputes and low occupancy on flights, carriers also fret about security for their crews on the ground due to violent political protests and economic chaos.

Today's Markets

In Asia, Japan flat. Hong Kong -0.2%. China -0.5%. India +0.1%.
In Europe, at midday, London -0.3%. Paris -0.6%. Frankfurt +1.3%.
Futures at 6:20, Dow flat. S&P -0.1%. Nasdaq -0.1%. Crude +0.1% to $47.69. Gold +0.2% to $1282.90.
Ten-year Treasury Yield +2 bps to 2.18%

Today's Economic Calendar

8:30 Productivity and Costs
8:30 Gallup US Consumer Spending Measure
9:45 PMI Services Index
10:00 Labor market condition index
10:00 Factory Orders
10:00 ISM Non-Manufacturing Index
12:30 PM TD Ameritrade IMX