Less than 24 hours to go until U.K. voters cast their ballot! Prime Minister Theresa May has toughened her anti-terrorism stance, vowing not to let human rights stand in the way of restricting the freedoms of suspects, but some final polls for the general election show the country could end up with a hung parliament as Jeremy Corbyn's Labour party has diminished the gap with Conservatives. If that should happen, the pound could plunge to as low as $1.20, a level last seen in January.

Economy

The latest IMF proposal is not helpful in reaching a resolution to the country's impasse with its European creditors, according to Greece's ruling party. Syriza's political committee said the plan pushed back decisions and "does not contribute positively in the direction of finding an honorable and commonly accepted solution."

Overlapping or replacing NATO? The European Union is set to unveil proposals today for a new European defense union. The "nature of the trans-Atlantic relationship is evolving," the EU's executive arm will say in a "reflection paper" on the future of the bloc's defense. "More than ever, Europeans need to take greater responsibility for their own security."

Further weighing into the Gulf state rift, President Trump appeared to support the isolation of Qatar, noting that his message against funding terror and extremism is being heeded by countries in the region. "The U.S. still wants to see this issue de-escalated and resolved immediately," said Press Secretary Sean Spicer. We're communicating with all the parties in the Middle East "to restore cooperation."

Australia's economy slowed in the first three months of the year as bad weather hit exports and a deceleration in homebuilding produced the weakest annual growth since 2009. New figures showed GDP growth at 0.3% Q/Q in the period ending March 31, slowing from 1.1% in the December quarter, but in line with economists' forecasts.

The Mexican peso has recovered all its losses vs. the greenback since President Trump was elected, discounting the worst fears of a trade war between the U.S. and its southern neighbor. A series of rate hikes by Mexico's central bank has added to the rally, as well as a win by President Nieto's PRI party in the election for governor of the country's largest state.

It also comes after the U.S. and Mexico reached an "agreement in principle" designed to avert a trade war over sugar, setting the course for bigger talks on rewriting NAFTA. While American producers failed to endorse the deal, the pact will go through a final drafting stage, during which the two sides will try to make it easier for them to "come on board."

The U.S. Department of Energy believes U.S. oil production will rise to 10M barrels a day next year, the highest average annual level on the books. The revision is another sign that U.S. drillers are taking full advantage of higher oil prices buoyed by OPEC's deal to limit production. Output in the American oil patch has surged about 9% to 9.3M barrels over the last eight months.

President Trump is will speak in Cincinnati today as part of what the White House has billed as a week-long effort to formally launch an initiative for $1T in infrastructure investment. He'll propose allocating $200B in federal funding over 10 years to spur at least an additional $800B in spending by states, municipalities and the private sector.

Stocks

Santander is taking over Banco Popular (OTCPK:BPESY). The Spanish bank is buying all shares of its distressed peer for the symbolic price of one euro and plans to carry out a €7B capital raise as part of the deal. Santander's (NYSE:SAN) acquisition will not affect deposit holders or imply any cost to taxpayers, according to Spain's economy minister, and implies no contagion for sovereign or banking sector risk.

Fresh woes for Wells Fargo (NYSE:WFC) as the Justice Department filed a friend-of-the-court brief in a lawsuit brought against the bank by two former employees, who were fired after they tried to report lending misdeeds to their supervisors. The DOJ remained neutral on the whistleblowers' claims, but urged the court to revise the legal analysis it made in dismissing the case last year.

HSBC is also facing a fresh lawsuit over allegations of foreign exchange manipulation. According to the FT, the bank's traders are being accused of cheating markets for their own profit more than a decade ago. HSBC and several other global banks were already fined $4.3B for systematic rigging in 2014.

Looking to make further inroads into lending, Goldman Sachs Bank USA (NYSE:GS) plans to raise the rate it offers customers on deposits to 1.2%, making it the highest interest paying bank, according to Bankrate.com. Its old rate was still pretty good. The Wall Street lender's consumer arm had previously offered savers 1.05%, compared to the national average of 0.06%.

Sears is shuttering 72 more stores, in addition to the more than 180 that have already been announced this year. The company released a list internally detailing the closures, which includes 16 Sears (NASDAQ:SHLD) outlets, 49 Kmart shops and seven auto centers. Most of the stores will close in September.

Moving things along... TerraForm Global (NASDAQ:GLBL) and TerraForm Power (NASDAQ:TERP) have announced court approval regarding their settlement of intercompany claims with SunEdison (OTCPK:SUNEQ). "Bankruptcy Court approval is a key condition to the closing of the sponsorship transaction with Brookfield (NYSE:BAM)," said CEO Peter Blackmore.

Anthem is pulling out of the health-insurance exchange in Ohio next year, leaving a second region of the country poised to have no marketplace options under the Affordable Care Act. According to Anthem (NYSE:ANTM), "decisions on ACA have become increasingly difficult due to the shrinking individual market as well as continual changes in federal operations, rules and guidance."

Stop challenging the chip sale process! "Toshiba (OTCPK:TOSYY) encourages Western Digital (NYSE:WDC) to redirect the considerable efforts that it has put into disrupting Toshiba's sale process into more productive channels that benefit both Toshiba and SanDisk," Toshiba lawyers said in a letter dated June 7. SanDisk, which was acquired by WDC last year, owns a 49.9% stake in a joint venture with Toshiba.

Bombardier is confident of winning a trade dispute with Boeing (NYSE:BA) in the U.S. and dismissed suggestions that the row could slow efforts to accelerate CSeries sales. The International Trade Commission is expected to make a preliminary ruling by June 12 on Boeing's complaint that Bombardier (OTCQX:BDRAF, OTCQX:BDRBF) dumped the jet below cost in the U.S. market while benefiting from unfair Canadian subsidies.

Blastoff! SpaceX (Private:SPACE) will fly its first mission for the U.S. Air Force in August when it launches the military's X-37B miniature spaceplane, said Air Force Secretary Heather Wilson. Four previous X-37B missions were launched by United Launch Alliance Atlas 5 rockets. ULA is a joint venture of Lockheed Martin (NYSE:LMT) and Boeing (BA).

Tesla is "definitely" on track to begin Model 3 production next month, according to Elon Musk. The automaker will also begin letting customers customize their orders, but initially will only offer a choice of color and wheel size. Other news? The Model Y crossover will be built on a new platform, while Tesla (NASDAQ:TSLA) is working with its "biggest customers" on the design of the semi truck.

Renault-Nissan boss Carlos Ghosn is recruiting a new operational second-in-command for the carmaking alliance, in a move designed to prepare his own succession and advance the companies' integration. Under the plan, the currently separate chief competitive officer roles at Renault (OTCPK:RNLSY) and Nissan (OTCPK:NSANY) would be fused into a single position. The role is expected to be filled later this year.

The housecleaning at Uber is just getting underway after more than 20 people were fired following a company-wide investigation into harassment claims. The ride-hailing firm is now thinking new strategy and branding. Bozoma Saint John - an Apple executive who has played a prominent role in recent product launches - is leaving to become chief brand officer at UBER.

Today's Markets

In Asia, Japan flat. Hong Kong -0.1%. China +1.2%. India +0.3%.
In Europe, at midday, London +0.1%. Paris +0.9%. Frankfurt +0.3%.
Futures at 6:20, Dow flat. S&P +0.1%. Nasdaq +0.1%. Crude -0.5% to $47.93. Gold -0.5% to $1291.30.
Ten-year Treasury Yield flat at 2.15%

Today's Economic Calendar

7:00 MBA Mortgage Applications
8:30 Gallup U.S. Job Creation Index
10:30 EIA Petroleum Inventories
3:00 PM Consumer Credit