In what has become an annual event, MSCI will decide this afternoon whether to include China's mainland stock market - which has restricted access for foreign investors - into its ETFs, including funds EEM and ACWI. It's a major decision: Indexers now rule the world. MSCI has more than $10T of active and passive assets benchmarked against it, with emerging markets alone accounting for $2T.

Economy

Sterling fell by almost a full cent vs. the dollar to $1.2669 after BoE Governor Mark Carney said now was not the time to raise interest rates, dashing some investors' hopes that the central bank had shifted in that direction. What about Brexit talks? Day one of negotiations between the U.K. and EU ended with Brussels getting its way on the timetable for Britain's exit from the bloc.

Renegotiating NAFTA could spill into next year, according to Commerce Secretary Wilbur Ross, but he still sees "plenty of reasons" to finish the trade talks in 2017. Mexico has a general election in July 2018, while the U.S. holds midterms elections a few months later. "We're certainly mindful of the calendar and the fact that the calendar is fundamentally not our friend."

A new group is looking to support carbon-cutting, less than three weeks after President Trump pulled the U.S. out of the Paris climate accord. The Climate Leadership Council took out a full page ad in today's WSJ, stating that America needs a consensus climate solution that "bridges partisan divides, strengthens our economy and protects our shared environment." Founding members: BP, XOM, GM, JNJ, PG, PEP, SAN, TOT, UL, RDS.A, RDS.B

The threat of direct Russian-American confrontation in Syria is escalating. Moscow said it would treat any plane from the U.S.-led coalition flying west of the Euphrates river as a potential "aerial target" and suspended communications via a military hotline. It comes after the U.S. downing of a Syrian government jet over the weekend.

More century bonds? Argentina sold $2.75B of a hotly demanded 100-year bond in U.S. dollars on Monday, which will go toward financing its budget and refinancing existing debt. The country only removed currency controls in 2015, and has yet to gain an investment-grade credit rating, but investors have been encouraged by President Macri's selection of market-friendly reforms.

Stocks

Tech is back on a tear as Apple (NASDAQ:AAPL) helped the Nasdaq yesterday log its best day of the year, with the S&P and Dow closing at new record highs. "Tech got beat up unfavorably over the past week or two, but as the group's earnings remain strong, we expect buyers are coming in to take advantage of the depressed prices," said Murphy Capital Management's Peter Lewis. More gains look in store for today's open.

"Like an old traditional marriage, where there are all kinds of rules and chaperones, we can't consummate the marriage, until we're actually officially hooked up," Whole Foods (NASDAQ:WFM) CEO John Mackey declared, describing the company's $13.7B deal with Amazon (NASDAQ:AMZN). Expansion of products? "Over time, there could be other formats that evolve that - that might - wouldn't be branded Whole Foods Market, potentially, wouldn't be our standards."

The tradeoff between time and quality looms large for McDonald's (NYSE:MCD) as it begins to roll out its fresh burgers. An on-demand Quarter Pounder takes about a minute longer to land in a customer's hands than does the original sandwich, according to restaurant managers and analysts, because grilling begins only after a patron orders. Speed-minded drive-through patrons account for 70% of McDonald's U.S. revenue.

Dumping sweets, chasing health? Nestle (OTCPK:NSRGY) has acquired a minority stake in Freshly, a provider of direct-to-consumer freshly prepared meals that are made without refined sugars or artificial ingredients. The investment will help Freshly build a new East Coast distribution center and kitchen in 2018 as it prepares to expand its U.S. service nationwide.

UPS plans to charge retailers extra fees to deliver packages during the busiest weeks before Christmas, creating a new challenge for an industry seek to offset declining foot traffic to shopping centers. UPS's fees will force retailers like Amazon (AMZN) and Wal-Mart (NYSE:WMT) to decide over the next few months whether to raise prices, a difficult to do when online shoppers are reluctant to pay shipping fees.

The U.K. Serious Fraud Office has charged Barclays (NYSE:BCS) and four former senior executives over fundraising from Qatari investors in 2008. The investigation, which has taken five years, centered around undisclosed payments to investors in the country amid a £12B emergency fund raising at the height of the financial crisis. BCS -0.3% premarket.

Don't believe everything Martin Shkreli says, at least what he tweets, his lawyer told a federal judge in an attempt to reduce his bail from $5M to $2M. The motion was rejected. The plea came ahead of Shkreli's fraud trial next week, which will decide whether the "Pharma Bro" looted millions of dollars from Retrophin (NASDAQ:RTRX) to repay investors in two hedge funds.

The FTC is filing an antitrust lawsuit seeking to block the proposed merger of DraftKings (Private:DRAFT) and FanDuel (Private:DUEL), alleging the deal would harm consumers who play daily fantasy contests. "We are disappointed by this decision and continue to believe that a merger is in the best interests of our players, our companies, our employees and the fantasy sports industry," the companies said in a joint statement.

Samsung is hoping the Galaxy Note 8 will be able to put last year's exploding Note 7 fiasco behind it and be a major challenger to Apple's (AAPL) iPhone 8. Alleged leaked images of the upcoming smartphone were posted overnight and sources say Samsung (OTC:SSNLF) will unveil the device at a media event in New York City on Aug. 26.

A merger between Sprint (NYSE:S) and T-Mobile (NASDAQ:TMUS) is "financially compelling," according to Moody's, but it faces a long road and daunting challenge from an operational standpoint. "A successful integration would likely take significant time, enabling competitors such as Verizon (NYSE:VZ) and AT&T (NYSE:T) to advance their own strategies and take market share."

A federal judge in San Francisco has named lawyer Elizabeth Cabraser to lead the case brought against Fiat Chrysler (NYSE:FCAU) by owners over allegations it bypassed diesel emission controls. She also served as lead attorney in Volkswagen's (OTCPK:VLKAY) Dieselgate scandal that led to the automaker agreeing to buy back 500K vehicles and spend billions compensating owners.

A man killed in a crash last year while using the semi-autonomous driving system on his Tesla (NASDAQ:TSLA) Model S kept his hands off the wheel for extended periods of time despite repeated audible warnings not to do so. That's according to the NTSB, which released 500 pages of findings. Tesla is also nearing a deal to open its first production plant in China, Bloomberg reports, which would help it avoid a 25% import tariff.

The U.S. Air Force is resuming local flying operations of Lockheed Martin's (NYSE:LMT) F-35 at Luke Air Force base in Arizona after an 11-day suspension. They were stopped earlier in the month when five "physiological"problems, like irregularities in pilots' oxygen supplies, occurred during flights between May 2 and June 8.

Boeing received more than three dozen pledges to buy the planned Max 10 on the first day of the Paris Air Show, as the planemaker stretched its 737 workhorse to challenge Airbus's (OTCPK:EADSY) sales lead for the largest single-aisle airliners. Boeing expects to win 240 orders or commitments for the new model - valued at roughly $30B - during the industry event this week.

Today's Markets

In Asia, Japan +0.8%. Hong Kong -0.3%. China -0.1%. India flat.
In Europe, at midday, London +0.1%. Paris +0.3%. Frankfurt +0.3%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -1.7% to $43.66. Gold +0.1% to $1247.30.
Ten-year Treasury Yield flat at 2.18%

Today's Economic Calendar

8:30 Current Account
8:55 Redbook Chain Store Sales
3:00 PM Fed's Kaplan: Monetary Policy