Here are the most important news items that investors need to start their trading day:
1. Eyes on inflation
Hotly anticipated inflation data rolls out this week as investors look for clues to what the Federal Reserve will do in its next few meetings. The consumer price index for June came in cooler than expected Wednesday morning, with inflation rising by a lower-than-expected 0.2% month to month and 3% vs last year. The producer price index, which tracks wholesale inflation, is on deck Thursday morning. Taken together with June's jobs data, which showed that hiring was still strong albeit slower, this week's reports could show that the Fed's rate hikes are paying off. After taking a pause in June, the central bank is widely expected to raise its benchmark rate later this month. Meanwhile, stocks are coming off two winning days as they head in to Wednesday's session. Follow live market updates.
2. Microsoft levels up
A federal judge ruled against the Federal Trade Commission's attempt to block Microsoft's nearly $70 billion acquisition of video game giant Activision Blizzard. "The Court finds the FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition," Judge Jacqueline Scott Corley wrote. The decision dealt the latest blow to the Biden administration's – particularly FTC Chair Lina Khan's – aggressive antitrust push, writes CNBC's Lauren Feiner. Microsoft and Activision aim to close their deal by Tuesday, although the FTC can still appeal.
3. Hot union summer
It's time to talk in Detroit. The United Auto Workers on Wednesday kicked off its bargaining period with auto companies as the union seeks a new contract ahead of mid-September, when its master agreement expires. The new UAW leadership has promised to take a tougher stance at the negotiating table with Ford, General Motors and Stellantis, particularly as the industry moves toward new electric vehicle technology and away from the traditional gasoline-powered internal combustion engine. Auto makers could end up losing hundreds of millions of dollars a week if they don't reach a deal with the UAW and workers go on strike, according to Wall Street estimates.
4. Another headache for Illumina
European regulators hit U.S.-based DNA sequencing company Illumina with a record $476 million fine Wednesday over the company's failure to get approval before closing its deal to buy Grail. Illumina's acquisition of the cancer test developer has been trouble since the deal closed in 2021. It sparked a fight with activist investor Carl Icahn, while Francis deSouza abruptly quit as CEO in May despite surviving a proxy vote. Illumina's market value has also tumbled to about $29 billion today from around $75 billion when the Grail deal was finalized. Illumina plans to appeal the EU's fine.
5. Zelenskyy pushes NATO
Ukraine President Volodymyr Zelenskyy wants stronger guarantees from NATO as his country remains under attack by Russian forces. While the U.S. and other Western nations have poured aid into Ukraine's effort to defend itself against Vladimir Putin's military, Zelenskyy wants his nation to join NATO, which considers an attack on one of its members an attack on all of them. "We want to be on the same page with everybody, with all the understanding, and for today what we hear and understand that we'll have this invitation when security measures will allow, so I want to discuss with our partners all these things," he said. Zelenskyy is also slated to meet with U.S. President Joe Biden at the NATO summit in Lithuania. Follow live war updates.
– CNBC's Alex Harring, Lauren Feiner, Jordan Novet, Michael Wayland, Annika Kim Constantino and Natasha Turak contributed to this report.
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