Capping four years of on-and-off talks, Sprint (NYSE:S) and T-Mobile (NASDAQ:TMUS) have agreed to merge under a $26B all-stock deal, valuing the combined company at $146B. With 127M customers, the group will be a more formidable competitor to Verizon (NYSE:VZ) and AT&T (NYSE:T), but regulatory approval may be challenging as it would leave the U.S. with three major wireless firms instead of four (see more M&A below).

Economy

Crowning the Fed victorious? The March report for personal consumption expenditures, the central bank's preferred inflation gauge, is expected to come in today at about 2% on a core basis. If that happens, the Fed will have essentially achieved its dual mandate from Congress, which calls for maximum employment (that box is already checked) and stable inflation (the Fed has specified a 2% target).

President Trump has threatened to shut down the federal government in September if Congress doesn't provide more funding to build a wall on the border with Mexico. "We will have no choice. We will close down the country because we need border security," he told a rally in Michigan. However, support from fellow Republicans could be complicated as the shutdown would come before mid-term elections in November.

Theresa May has lost a pro-EU ally following the resignation of Home Secretary Amber Rudd over an immigration scandal, marking her fourth cabinet member to quit in the last six months. Rudd was due to attend a key meeting of the Brexit "war cabinet" on Wednesday to weigh the options for the U.K.'s future trading relationship, but depending on who replaces her, it could shift the cabinet balance in favor of a harder Brexit.

Fearing tariffs on steel and aluminum imports, German business leaders voiced disappointment on Saturday about the outcome of talks between Chancellor Angela Merkel and President Trump. "We had an exchange of views. The decision lies with the president," Merkel said at a press conference. Europe has been pushing for a definitive carve-out from the higher duties with temporary exemptions set to expire on May 1.

Russia's Prime Minister Dmitry Medvedev is backing the idea of making it a criminal offense for Russians to observe the sweeping sanctions imposed by the U.S. The restrictions are aimed at destroying Russia's socio-political system and harming the economy and individuals, he declared, adding that the government should support sanctions-hit Russian companies to ensure that jobs are not lost.

"As a first practical step for national reconciliation and unity," North Korea will shift its time zone 30 minutes earlier to align with South Korea as it shuts down its nuclear test site and "demonstrates the closure to the world." China will also send its top diplomat, Wang Yi, to visit Pyongyang on Wednesday and Thursday, ahead of an upcoming summit with President Trump.

Stocks

Shaking up the U.K. supermarket sector, J Sainsbury (OTCQX:JSAIY) and Walmart's (NYSE:WMT) Asda have announced plans to merge in a deal worth £15B. The two grocers have struggled with their sales growth, which has weighed on their ability to get cheaper deals with suppliers. If approved by regulators, the combination would surpass Tesco (OTCPK:TSCDY) - currently the largest retailer in Britain with a 25% market share.

Marathon Petroleum has agreed to buy rival Andeavor (NYSE:ANDV) for more than $23B, forming a company that would leapfrog Valero Energy (NYSE:VLO) as the largest U.S. refiner by capacity. The group, which will have the ability to process about 3.1M barrels per day, is expected to produce $1B of synergies and will be run by Marathon (NYSE:MPC) CEO Gary Heminger. A senior role will also be granted to Andeavor CEO Gregory Goff.

Industrial REIT M&A? Deepening its presence in high-growth markets, Prologis (NYSE:PLD) is acquiring DCT Industrial Trust (NYSE:DCT) in an $8.4B all-stock transaction, with expectations of near-term synergies of about $80M. Prologis owned or managed more than 3,200 properties worldwide as of Dec. 31 and leased facilities to about 5,000 customers, the largest being Amazon.com (NASDAQ:AMZN).

BASF has secured EU antitrust clearance to acquire a package of businesses from Bayer (OTCPK:BAYRY), which is looking to offload assets in return for EU approval for its $62.5B acquisition of Monsanto (NYSE:MON). According to the European Commission, the concessions address concerns that the BASF (OTCQX:BASFY) deal may reduce innovation for some herbicides and certain seed treatments.

Following five weeks of testimony, closing arguments in the DOJ's antitrust case against AT&T's (T) planned acquisition of Time Warner (NYSE:TWX) are due tomorrow. The session will provide a venue for U.S. District Judge Richard Leon to further signal his thinking, although he isn't expected to rule for several weeks. A win for the DOJ would give antitrust enforcers additional momentum, while a loss could embolden companies to pursue more transformative deals.

Darwin Deason and Carl Icahn, top shareholders in Xerox (NYSE:XRX), are celebrating, as the company's $6.1B merger with Fujifilm (OTCPK:FUJIY) was temporarily blocked following a court injunction. The ruling, which reopens nominations to Xerox's board, comes after the activists filed a lawsuit against the "dramatically undervalued" deal. Fujifilm is now considering all options, including whether to appeal the decision.

Saudi Aramco has reshuffled its board, adding five members - of which three are non-Saudi nationals - as it prepares for a public listing later this year or in early 2019. Besides bringing in more international experience, one of the new directors is former Sunoco CEO Lynn Laverty Elsenhans. That will add a female voice to Aramco (ARMCO), where few women hold leadership roles.

Originally filed in 2016, PayPal (NASDAQ:PYPL) has refreshed a patent for an augmented reality shopping experience. The glasses as imagined could overlay product information like prices, payment options and return policies onto physical objects. It could also walk shoppers through the steps to purchase items online, with vendor and purchaser information already stored in the system.

Avengers fever... Disney's (NYSE:DIS) Infinity War has officially recorded the highest-grossing opening weekend in the history of cinema. The film brought in $250M in the U.S. alone, besting the previous record-holder, Star Wars: The Force Awakens, which made just under $248M domestic upon its release. More records are in store as the movie doesn't even come out in China until May 11.

Wynn Resorts has renamed the $2.5B casino it's building outside of Boston to Encore (from WYNN) Boston Harbor as the company continues to distance itself from founder Steve Wynn after sexual misconduct allegations. Massachusetts state regulators are also expected to issue a decision this week on whether he'll be considered a part of the project for regulatory purposes.

WPP +7% premarket as the world’s biggest advertising group reported better than expected results and reiterated its full-year guidance despite the recent departure of long-serving founder Martin Sorrell. Joint chief operating officers Mark Read and Andrew Scott also said they would review WPP's strategy, focus on growth and address the parts of the business that are struggling.

Wells Fargo moment for Australia's AMP (OTCPK:AMLYY)? The fallout is widening from the financial services company's fees-for-no-service scandal, with Chairwoman Catherine Brenner resigning following the departure of CEO Craig Meller. AMP directors will also be stripped of 25% of their fees for the rest of the year amid a public outcry over misconduct in the financial services sector.

A passenger aboard Southwest (NYSE:LUV) Flight 1380 has filed a lawsuit against the airline calling for compensatory and punitive damages following the fatal engine failure earlier this month. Southwest had "placed profits and business" over passenger safety and continued to operate the engine "even when there was confirmation that an unsafe condition existed." The suit also named CFM International (GE, OTCPK:SAFRY).

Space travel is "the most important thing" I'm currently working on, said Jeff Bezos ahead of the eighth successful launch and booster return of Blue Origin's (BORGN) New Shepard rocket on Sunday. The spacecraft are being designed to carry up to six "space tourists" to altitudes above 62 miles, the widely recognized threshold of space, with piloted test flights presumably starting later this year.

Today's Markets

In Asia, Japan closed. Hong Kong +1.7%. China closed. India +0.6%.
In Europe, at midday, London flat. Paris +0.2%. Frankfurt +0.5%.
Futures at 6:20, Dow +0.4%. S&P +0.3%. Nasdaq +0.5%. Crude -1.1% to $67.36. Gold -0.5% to $1316.90. Bitcoin -1.4% to $9258.
Ten-year Treasury Yield flat at 2.96%

Today's Economic Calendar

8:30 Personal Income and Outlays
9:45 Chicago PMI
10:00 Pending Home Sales
10:30 Dallas Fed Manufacturing Survey