Yesterday's Fed minutes revealed a split among policymakers on the timing of balance sheet normalization, while suggesting the bank plans to maintain gradual rate hikes. Today it's the ECB's turn. Following a "mini-taper tantrum" sparked by upbeat comments on the eurozone economy from Mario Draghi last week, the publication of June's policy meeting will be more closely watched than ever. It will be released at 7:30 a.m. ET.

Economy

North Korea's actions are "quickly closing off the possibility of a diplomatic solution," U.S. ambassador Nikki Haley told a U.N. Security Council meeting, stating the country is prepared to use military force against Pyongyang. Defense stocks could rise again today as President Trump said he's contemplating some "pretty severe things" to retaliate after the isolated regime launched an ICBM.

The European Union and Japan are to sign a major free trade deal today in Brussels, ahead of this weekend's G20 summit in Hamburg. Among other things, the pact would eliminate duties on cars, agriculture and food imports, as well as other goods and products. "Ambitious free and fair trade deal in the making," EU President Donald Tusk tweeted earlier this week.

EU Brexit negotiator Michel Barnier said London's "red lines" for a future trade relationship meant Britain was definitely leaving the single market and customs union, but only membership of both would permit the current "frictionless" trading arrangements. "I have heard some people in the U.K. argue that one can leave the single market and keep all of its benefits - that is not possible."

Government supporters armed with pipes burst into the National Assembly in Caracas on Wednesday and severely beat several opposition lawmakers during a special session coinciding with Venezuela's Independence Day. The unprecedented attack comes as the nation's political and economic crises grow more inflamed ahead of a contested effort to redraft the constitution.

Illinois looks set to pass a budget this week, with the legislature having overridden the governor's veto. While the passing of a budget was thought to be enough to satisfy the ratings agencies, Moody's isn't being swayed. "The plan appears to lack concrete measures that will materially improve Illinois' long-term capacity to address its unfunded pension liabilities."

Stocks

The Fed and FDIC have disclosed how eight of the nation's largest banks would wind down - without needing a taxpayer bailout - and gave AIG and Prudential Financial (NYSE:PRU) an extra year to submit their doomsday plans. Public portions of the "living wills" were posted for BofA (NYSE:BAC), JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), BNY Mellon (NYSE:BK), Citigroup (NYSE:C), Morgan Stanley (NYSE:MS), State Street (NYSE:STT) and Wells Fargo (NYSE:WFC).

Latest Brexodus... Deutsche Bank (NYSE:DB) is preparing to move large parts of the trading and investment banking assets it currently books in London to its hometown of Frankfurt in response to Brexit, Bloomberg reports. The strategy, which is still being finalized and would be reviewed if the Brexit scenario changes, will probably be implemented over the next 18 months.

Poland has agreed to buy Patriot missile defense systems (NYSE:RTN) from the U.S., in a deal worth up to $7.6B, as President Trump visited Warsaw to discuss transatlantic relations. During a joint news conference with Polish President Andrzej Duda, Trump stated it was "past time" for all NATO countries to "get going" on their financial obligations.

Reckitt Benckiser has warned it will report lower sales after falling victim to the "Petya" malware attack in late June that wreaked havoc on a range of global companies. Shares are on under pressure in London, falling as much as 3%. Reckitt (OTCPK:RBGLY) now expects a 2% drop in second quarter like-for-like revenues and revised down its full-year growth forecast.

EU antitrust regulators are charging Merck (NYSE:MRK), Sigma-Aldrich (NASDAQ:SIAL), General Electric (NYSE:GE) and Canon (NYSE:CAJ) for providing misleading information during their merger deals. While the charges will not affect the EU approvals, they could lead to fines up to 1% of global revenue for Merck and General Electric, and up to 10% for Canon.

Tesla has shed another 3% premarket, on top of yesterday's 7% fall - its biggest percentage decline in more than a year - as worries grew over its delivery numbers. News from a new set of crash tests isn't helping. The Insurance Institute for Highway Safety is questioning Tesla's (NASDAQ:TSLA) claim that the Model S is the "safest car in history."

The European Commission has given the green light to Peugeot's (OTCPK:PEUGF) €2.2B takeover of Opel (NYSE:GM), creating Europe's second-largest carmaker after Volkswagen (OTCPK:VLKAY). The EU said the combined market shares of the two companies were relatively small in all the bloc's national markets, only exceeding 40% in Estonia and Portugal. Opel hasn't turned a profit since 1999.

Baidu is under investigation to determine whether it had broken any laws after its chief executive tested a driverless car on public roads and live-streamed the experience. Forming broad alliances and partnerships, Baidu (NASDAQ:BIDU) is taking a leading role in the development of self-driving cars in China and beyond, but may now face sanctions from authorities investigating the incident.

United Airlines is in hot water again over forcing a woman flying from Houston to Boston to hold her 2-year-old son on her lap after an employee gave the toddler's purchased seat to a standby passenger. "What happened to my son was unsafe, uncomfortable and unfair," Shirley Yamauchi told KITV. United (NYSE:UAL) issued an apology five days after the flight.

Pandora board members and top shareholders have Adam Bain, Twitter's (NYSE:TWTR) former chief operating officer, on a short list of possible candidates to become the company's new CEO. "They have someone in mind who is a world-class executive with an advertising background," a source told the NY Post. However, he still hasn't had substantive talks with Spencer Stuart, the firm seeking Pandora's (NYSE:P) new chief.

A tale of two billionaires... Dish Network (NASDAQ:DISH) CEO Charlie Ergen has been turning his attention to the tech world and a somewhat surprising potential partner has emerged: Amazon (NASDAQ:AMZN) CEO Jeff Bezos. The two have gotten to know each other better over the past year and have discussed a partnership to enter the wireless business, sources told WSJ.

As viewers increasingly rely on the internet to watch sports, Facebook (NASDAQ:FB), Twitter (TWTR) and Snap (NYSE:SNAP) are seeking online rights to video clips from next year's World Cup. According to Bloomberg, the companies have offered 21st Century Fox (FOX, FOXA) tens of millions of dollars for highlights of the Russia-hosted games that air in the U.S.

SoftBank is targeting raising between $3B-$5B through an offering of U.S. dollar bonds, Reuters reports. An issuance of hybrid bonds is said to be under preparation. It comes after SoftBank (OTCPK:SFTBY) announced the world's largest private equity fund - the nearly $100B Vision Fund (also backed by Saudi Arabia's main sovereign wealth fund) - in May.

Cybersecurity pioneer John McAfee has agreed not to use his own name atop his firm or in connection with other cybersecurity products as part of a deal to end a lawsuit he brought against Intel (NASDAQ:INTC). Intel bought the name more than two decades ago, but McAfee sued the company in September asking a court to declare he could use his name to rebrand MGT Capital Investments (OTCPK:MGTI).

Today's Markets

In Asia, Japan -0.4%. Hong Kong -0.2%. China +0.2%. India +0.4%.
In Europe, at midday, London-0.6 %. Paris -1%. Frankfurt -0.7%.
Futures at 6:20, Dow -0.3%. S&P -0.4%. Nasdaq -0.7%. Crude +1.6% to $45.84. Gold +0.2% to $1223.60.
Ten-year Treasury Yield +3 bps to 2.36%

Today's Economic Calendar

Chain Store Sales
7:00 MBA Mortgage Applications
7:30 Challenger Job-Cut Report
8:15 ADP Jobs Report
8:30 International Trade
8:30 Initial Jobless Claims
8:30 Gallup Good Jobs Rate
9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
9:45 Bloomberg Consumer Comfort Index
11:00 EIA Petroleum Inventories
4:30 Money Supply
4:30 Fed Balance Sheet