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Good morning. There's new executive arrests in the Wirecard scandal, MiFID II rules are to be de-fanged, and more blue-chip earnings are on tap. Here's what's moving markets.

Years of Lies

Former Wirecard AG CEO Markus Braun has been re-arrested without the possibility of bail, accused by German prosecutors of having falsified accounts as early as 2015. Former CFO Burkhard Ley and former head of accounting Stephan Freiherr von Erffa are now also in custody, accused of having acted in concert with Braun. Braun's lawyer did not reply to calls seeking comment, and lawyers for the other arrested men could not be located. Former COO Jan Marsalek, the first executive to be fired after the revelations, remains at large, amid media reports that he fled to Belarus last month and is presumably still there or in Russia.

Naughty List

Switzerland will probably get named a currency manipulator by the U.S., making life more difficult for the country's central bank, according to UBS Group AG. The Swiss, who for years have been using foreign exchange interventions to prevent the franc from appreciating too much, now meet all three criteria for manipulators set out by the U.S., namely a high trade and current account surplus plus large-scale interventions, a UBS economist wrote.

Testing Crunch

Globally, virus cases surpassed the 15 million mark, with the U.S., Brazil and India together accounting for nearly half of all confirmed cases globally. In the U.S.,logistical issues with getting virus tests done quickly enough is proving a hurdle to getting the outbreak under control. The U.S. is up to 700,000 to 800,000 tests a day, according to the Covid Tracking Project. But according to Ashish Jha, director of Harvard's Global Health Institute, it would take 1.2 million tests a day to contain the outbreak. To suppress the virus would take 4.3 million tests each day. Meanwhile, on the stimulus front, Senate Majority Leader Mitch McConnell may introduce the GOP stimulus plan as soon as Thursday with a series of bills that would serve as an opening to negotiations with Democrats.

MiFID II Light

The European Union is planning to roll back landmark regulations on securities trading and investment research, arguing that softer rules on the finance industry are needed to help the economy recover. MiFID II's "unbundling" rules have been criticized for removing the incentive for analysts to produce research, especially on smaller stocks that struggle to attract the attention of investors. Proposed new rules by the European Commission would allow payments to be re-bundled for research on fixed income markets and companies worth less than 1 billion euros ($1.15 billion), according to documents seen by Bloomberg News.

Coming Up…

Chip maker STMicroelectronics NV boosted its guidance and beat quarterly estimates, pharma group Roche Holding AG posted results that missed estimates but signaled higher dividends, and Mercedes-Benz parent Daimler AG warned that it wouldn't catch up on vehicle sales this year. Other highlights on this morning's reporting agenda include food behemoth Unilever NV, oil major Repsol SA and marketing firm Publicis Groupe. Aside from earnings, get ready for three sentiment indicators-- Eurozone and German consumer confidence, and French manufacturing confidence. An afternoon highlight will be weekly U.S. initial jobless claims, as market participants hope for a sign of a sustained recovery after last week's slow-down.

What We've Been Reading

This is what's caught our eye over the past 24 hours. 

And finally, here's what Mark Cudmore is interested in this morning

My trader senses are tingling. Having been bullish global stocks for most of the past few months, I'm suddenly feeling quite nervous again. The obvious threats -- rising coronavirus fatalities and mounting U.S.-China tensions -- aren't new. I'm more concerned about the fact that good news isn't being celebrated in stocks. So far, most earnings are comfortably beating (low) expectations, especially among the bellwether names. If that's not going to help equities to another leg higher, what will? More stimulus? And that's my other concern: Rising political conflict in the U.S. may mean a rather disappointing stimulus outcome compared to what investors had been assuming only a month ago. Don't get me wrong -- this isn't a call for a new bear market and general panic. It's just a suggestion that a 45% gain for the MSCI All-Country World Index over the past four months is really quite sufficient and upward momentum is declining rapidly. I'd be much more enthused again after a healthy correction and the height of summer seems an entirely appropriate time for one.

Mark Cudmore is a Bloomberg macro strategist and the Managing Editor of the Markets Live blog. Bloomberg Terminal users can follow him there at MLIV.

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