10 things you need to know before the opening bell

Here is what you need to know.

Britain probably won’t leave the UK until 2019. Citi says article 50 — the mechanism under the Lisbon Treaty in which a country tells the European Union it is leaving the bloc and thereby gives a two-year notice period — isn’t likely to be triggered anytime soon. The bank believes the ruling Conservative party will first find a new prime minister, then political conferences are likely to be held before a potential general election. After all that happens, the new government could trigger article 50 once it was in office, Citi says.

Mario Draghi says Brexit could reduce eurozone GDP. Speaking in front of EU leaders on Tuesday, European Central Bank head Mario Draghi said Brexit could shave 0.3 to 0.5 per cent off eurozone growth over the next three years. Reuters reports, citing an EU official, Draghi said the slowdown in growth is likely to come from a softening in the British economy and a slump in UK trade. Additionally, Draghi reportedly told leaders lower stock prices could lead to a higher cost of capital, which could weigh on growth.

The British pound is higher. The pound continues to claw its way back after its steep slide in response to Brexit. Sterling dropped about 11% from its high on Thursday into Monday’s trade. Wednesday’s 0.5% gain has the pound up to 1.3410, and 2.2% off its recent low.

A huge energy deal is being terminated. Energy Transfer has terminated its $33 billion merger with Williams due to “failure of conditions under the merger agreement.” According to Bloomberg, Energy Transfer was able to back out of the deal after it was discovered a combination wouldn’t free investors from their tax liabilities. Williams shareholders approved the deal on Monday and are appealing.

Nike’s futures sales disappointed. The athletic apparel giant reported adjusted earnings per share of $0.49, beating the Bloomberg consensus by a penny. Revenue rose 6% to $8.2 billion, but was a bit shy of the $8.28 billion that was expected. The closely followed worldwide futures orders jumped 11%, missing the 13% increase that analysts were anticipating. Shares of Nike were down as much as 6% in after-hours trade.

Sony cut its 2017 revenue target. The electronics company lowered its fiscal year 2017 revenue target to a range of 1 trillion-1.05 trillion yen ($9.76 billion-$10.25 billion) for the year starting April 2017, citing slowing global demand for smartphones. The new target is down from Sony’s estimate of 1.3 trillion-1.5 trillion yen.

Fed “stress tests” results are coming. Last week, the first part of the Fed’s stress tests were released, showing all of the big banks met their capital requirements. At 4:30 p.m. ET, the second round results of the tests will be released. The results will show whether or not the banks can proceed with their plans to return capital to shareholders through either dividends or buybacks.

Global markets continue to rally. Spain’s IBEX (+3%) leads the gains in Europe after Japan’s Nikkei (+1.6%) paced the advance in Asia. S&P 500 futures are up 12.75 points at 2041.25.

Earnings reports trickle out. General Mills and Monsanto report ahead of the opening bell.

US economic data picks up. Personal income and spending will be released at 8:30 a.m. ET and pending home sales will be announced at 10 a.m. ET. Then, at 10:30 a.m. ET, US crude oil inventories are due out. The US 10-year yield is down one basis point at 1.46%.

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