-Pfizer/Allergan merger terminated: Pfizer Inc. has decided to end its $160 billion merger with Allergan Plc, according to a person familiar with the matter. The cancellation comes after the Treasury Department unveiled new rules to combat tax inversions. The cancellation of the deal, which was to be the the largest ever in the pharma industry, will cost banks and advisors millions of dollars in lost fees but will be seen as a victory for U.S. President Barack Obama who called inversions “one of the most insidious loopholes out there.”
-Markets rise: After a mixed session in Asia overnight which saw the MSCI Asia Pacific Index little changed, European stocks are rising. The Stoxx 600 Index added 0.4 percent by 10:11 a.m London time, rebounding from a six-week low, with energy shares leading the gains. S&P 500 futures were 0.4 percent higher. In the bond market, U.S. Treasuries are giving back some of yesterday’s gains, while Germany this morning sold €3.2 billion of debt maturing in 2018 at a yield of -0.48 percent.
-Fed minutes are due: The Federal Reserve will release minutes from the March 15-16 meeting at 2 p.m. EDT in Washington . Investors will be watching for signs of hawkishness as they look to the return of global central bank divergence. The European Central Bank releases its account of its March 10 meeting tomorrow. The euro was 0.4 percent lower at $1.135o at 11:00 a.m. in London.
-Oil recovers: Oil is extending its gains following comments from Kuwait’s governor to OPEC saying that a production freeze may be agreed, even if Iran refuses to take part. West Texas Intermediate for May delivery was $1.00 a barrel higher at $36.87 at 10:57 a.m. London time. In oil consolidation news, the U.S. Justice Department has prepared a lawsuit to stop Halliburton Co.’s bid to buy Baker Hughes Inc.
-Underdogs win in Wisconsin: Texas Senator Ted Cruz and Vermont Senator Bernie Sanders both won their respective party votes in Wisconsin. For Republican front-runner Donald Trump, the setback increases the likelihood of the race going all the way to the party convention in July. On the Democratic side Hillary Clinton still holds a strong delegate count lead as she looks to the New York primary on April 29.
– Massive pharma deal collapses: The $160 billion takeover deal between Pfizer (PFE) and Allergan (AGN) has fallen apart. The breakup comes after the U.S. Treasury introduced new regulations on Monday designed to deter U.S. companies from merging with foreign firms in order to lower their American tax bill. Shares in the Dublin-based Allergan dropped sharply Tuesday on expectations the deal would be nixed. The firms said the acquisition was «terminated by mutual agreement.»
– Global market overview: U.S. stock futures are pushing up and there’s a relatively positive mood in European markets. Asian markets ended the day with mixed results. The mood has been helped by a rally in oil prices of about 3% to around $37 per barrel. Traders will get more information about the oil market at 10:30 a.m. ET when the U.S. Energy Information Administration releases its weekly oil inventory report. One of the biggest market movers of the day is Air France-KLM Group. Shares in the European carrier are down by about 3% after the company announced its CEO was leaving the firm for a new role.
– Earnings: A few high-profile earning reports will be coming through Wednesday. Monsanto (MON) and Constellation Brands (STZ) are reporting results ahead of the open. Swedish retailer H&M (HNNMY) reported results showing sales rose by about 8.5%, though profit took a hit due to higher costs. Shares in the company are rising by about 4% on the Nasdaq Nordic exchange. Bed Bath & Beyond (BBBY) will report its quarterly results after the markets close.
-The view from the Fed: The U.S. Federal Reserve will release the minutes from its latest meeting on monetary policy at 2 p.m. ET. Traders like to mine this release for insight into the Fed’s views on the economy and its plans for interest rate levels. The Fed began raising interest rates in December from record-low levels. But there is uncertainty about how quickly it will hike rates in the future.
– Tuesday market recap: Tuesday was a negative day for U.S. stocks. The Dow Jones industrial average declined by 0.8%, while the S&P 500 and the Nasdaq each fell by 1%.