| Want the lowdown on what's moving European markets in your inbox every morning? Sign up here. Good morning. U.S.-China tensions rise, Merkel pushes for consensus ahead of the EU's crisis aid meeting, and some of Europe's winning lockdown stocks are reporting earnings. Here's what's moving markets. 'A big one' Germany's Angela Merkel and Italy's Giuseppe Conte showed a united front on delivering a 750 billion-euro recovery plan for the bloc. "The task is a huge one, so the response also has to be a big one," Merkel said. Conte said his government is willing to accept tighter criteria for the grants and loans package, a signal to "Frugal Four" nations including the Netherlands and Sweden, which have demanded a set of conditions attached to any funding. On Friday, European leaders are meeting in-person for the first time since the beginning of lockdowns to discuss the aid package. 13 Million Global cases passed the 13-million mark, as the WHO warned that things won't return to normal for the foreseeable future and that a new vaccine won't become available to everyone immediately. England will make face masks compulsory in all shops starting July 24, clearing up the government's stance after conflicting signals over the weekend. Germany's virus reproduction rate, or R-naught, rose back above the key threshold of 1 for the first time in three weeks. In other sobering news, research from King's College London suggests survivors' antibody immunity may only last for a few months. 'Flexing Muscles' U.S.-China relations took another twist as the Trump administration rejected Beijing's expansive maritime claims in the South China Sea, reversing a previous policy of not taking sides in such disputes. A spokesperson for the Chinese Embassy in the U.S. called the Trump administration's actions "completely unjustified," saying it is "flexing muscles, stirring up tension and inciting confrontation." Meanwhile, data overnight showed China's exports and imports both rose in June, despite economists predicting a decline for both. Finally, the U.K. is poised to ban Huawei Technologies Co. from its next generation mobile networks under a two-step plan, a person familiar with the matter said. Stocks Slide European futures are pointing lower after Asian stocks erased much of Monday's gain, also driven by data showing a huge contraction in Singapore's economy in the latest quarter. In New York, the S&P 500 Index briefly touched its highest since the pandemic sell-off in March, before closing lower. The Nasdaq hit another record before finishing in the red, too. Even Tesla Inc. finished down despite being up more than 16% at the session high as thousands of day traders bought shares. Finally,
oil dropped for a second day Tuesday amid expectations that OPEC+ will start winding down production cuts next month. Coming Up… Meal-kit delivery firm HelloFresh forecast second-quarter revenue and adjusted Ebitda above expectations. Gerresheimer AG, whose business line of syringes and vaccine vials helped its stock outperform throughout the coronavirus crisis, posted second-quarter profit that beat the highest estimates. Grocery delivery company Ocado Group Plc, whose stock nearly doubled amid Britain's lockdown, is also set to release first-half earnings. Later, a German court is expected to rule whether Tesla over-promised on its self-driving capabilities. What We've Been Reading This is what's caught our eye over the past 24 hours. And finally, here's what Cormac Mullen is interested in this morning Croatia and Bulgaria aren't the only ones keeping a close eye on all things euro this month. For the sixth time in seven weeks, Europe's common currency is attempting to close above a key level of technical resistance -- its 200-weekly moving average against the dollar. As my colleague Vassilis Karamanis pointed out Monday, this average has been capping rallies in the currency and keeping it within a bearish medium-term trading range against the greenback. The euro has strengthened about 1% so far against the U.S. currency in July -- less than many Group-of-10 peers -- but has a number of potential catalysts this week that might provide some extra momentum. The European Central Bank is meeting to decide on policy, with investors mostly watching out for any adjustment to their bond-buying program, and of course EU leaders meet in Brussels to hash out the details of a massive economic stimulus package. Euro bulls will be hoping for an above-average end to the week.  Cormac Mullen is a cross-asset reporter and editor for Bloomberg News in Tokyo. Like Bloomberg's Five Things? Subscribe for unlimited access to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. | 
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