Futures wavered between slight gains and losses overnight with investors largely attuned to the Fed's symposium in Jackson Hole, Wyoming, over the next two days. Philly Fed President Patrick Harker and Dallas Fed President Robert Kaplan will kick off the festivities today, commenting on the world's largest economy, before Fed Chair Jerome Powell takes the stage tomorrow. The ECB is also scheduled to release minutes of its July policy meeting, at which it raised the possibility of further rate cuts, money printing and a reprieve from its penalty charge on bank deposits.

'Recalibration' of policy stance

The widely watched 2-year/10-year U.S. yield curve flattened and then briefly inverted on Wednesday after the release of the Fed's meeting minutes. Officials cut rates as insurance against low inflation or a deeper decline in business investment driven by the trade war, reasons that look even sharper as the central bank moves toward its meeting in September. While policymakers were deeply divided over whether to cut interest rates, they were united in wanting to signal the Fed was not on a "pre-set course" for more easing.
Go deeper: Mark Grant comments on the negative yield rabbit hole.

Tax reversal

A day after President Trump said he was looking at a payroll tax cut or indexing capital gains to inflation, he is no longer thinking of such moves. "I'm not looking at a tax cut now. We don't need it. We have a strong economy," he told reporters on the White House lawn. "I've studied indexing for a long time and I think it will be perceived - if I do it - as somewhat elitist. I don't want to do that."

Ballooning U.S. deficit

The federal government will rack up $12.2T in deficits through 2029, according to a new projection from the Congressional Budget Office, an $809B increase from its last projection in May. That will boost debt held by the public to 95% of gross domestic product, its highest since just after World War II. Fueling the increase from May’s projection is the bipartisan deal to raise spending caps, which would add $1.7T to the deficit over the course of the next decade.

Farmers vs. Big Oil

Farmers have been infuriated at the Trump administration's decision to grant waivers exempting 31 oil refineries from rules requiring them to blend corn-based ethanol into gasoline. As a result, national and state trade groups have delivered letters to the White House over the past 48 hours detailing the damage the agreements have caused the biofuel industry. Farmers, who are seeing crop prices hit hard by the trade war, have also complained that the recent government crop report did not reflect damage from historic flooding this spring.
Go deeper: Check out related ETFs like CORN and FUE.

E-cig scrutiny

Four dominant e-cigarette manufacturers are facing a probe from the U.S. House Energy and Commerce Committee. Chairman Frank Pallone has contacted the CEOs of Juul Labs (JUUL), Fontem Ventures (OTCQX:IMBBY), Japan Tobacco (OTCPK:JAPAF) and Reynolds American (NYSE:BTI) requesting information by Sept. 20 about the health impact of their vaping products, as well as their marketing practices related to use by children. On Wednesday, the CDC additionally said it was investigating 153 possible cases of severe lung illness associated with e-cig use.
Go deeper: Altria (NYSE:MO) holds a 35% stake in Juul.

Brexit tour

The prospect of a no-deal Brexit is growing after Germany's Angela Merkel gave Boris Johnson 30 days to solve "backstop" disagreements, while the reaction was harsher in France. Ahead of a meeting today with Johnson, French President Emmanuel Macron bluntly ruled out any further talks on the divorce deal. He sees no reason to grant another Brexit delay unless there was a "significant political change" in Britain and warned that the U.K. risked being subordinated by the U.S if it crashed out of the EU.
Go deeper: Breakdown on sterling vs. its peers.

Zero interest

Negative yields may be taking their toll on investor demand, as the world's first 30-year bond offering a zero coupon struggled to find buyers. Germany sold only €824M of the notes maturing 2050, falling far short of its €2B target. A zero-coupon, 0% long-term bond is not without precedent - with the country selling 10-year, 0% paper in April 2015. Signals that the global bond rally may now be sputtering given that more than $16T of securities around the world have negative yields.

No G7 agreement

This weekend's G7 summit is set to end without a joint communique for the first time since the gatherings began in 1975, after French President Emmanuel Macron decided to abandon the tradition due to "a very deep crisis of democracy." He cited the U.S. decision to withdraw from Paris climate accords as one example of why it would be difficult to display a united front. Alongside environment and trade, analysts expect Brexit, inequality, the possible reinstatement of Russia to the "G8" and tech giant taxation to dominate the meeting.

Wednesday's Key Earnings

Nordstrom (NYSE:JWN) +12.7% AH delivering strong profits.
L Brands (NYSE:LB) -0.5% AH dragged down by Victoria's Secret.
Lowe's (NYSE:LOW) +10.4% smashing earnings estimates.
Target (NYSE:TGT) +20.4% after a blowout quarter.

Today's Markets

In Asia, Japan +0.1%. Hong Kong -0.8%. China -0.1%. India -1.6%.
In Europe, at midday, London -0.6%. Paris -0.4%. Frankfurt -0.1%.
Futures at 6:20, Dow -0.2%. S&P -0.3%. Nasdaq -0.4%. Crude +0.7% to $56.07. Gold -0.5% to $1507.60. Bitcoin -1.5% to $10039.
Ten-year Treasury Yield flat at 1.57%

Today's Economic Calendar

8:30 Initial Jobless Claims
9:45 PMI Composite Flash
10:00 Leading Indicators
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
4:30 PM Money Supply
4:30 PM Fed Balance Sheet