By Jamie McGeever
ORLANDO, Florida (Reuters) -TRADING DAY
Making sense of the forces driving global markets
By Jamie McGeever, Markets Columnist
Politics and AI powered huge moves across world markets on Monday, namely the collapse of the French government and surprise emergence of a likely new leader in Japan, and a multi-billion dollar chip-supply deal between AMD and OpenAI.
More on that below. In my column today, I ask the question: who needs U.S. economic data when you have the stock market? It may sound flippant, but the ties between Wall Street, household wealth and consumption have rarely been stronger.
If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today.
1. From OpenAI to Meta, firms channel billions into AIinfrastructure as demand booms 2. France’s political paralysis sparks fresh credit ratingwarnings 3. Takaichi win as Japan leader may delay, not derail, BOJrate hikes 4. Time for Germany’s ‘sugar rush’ to hit: Mike Dolan 5. Top fund managers urge Bank of England to stop sellinggilts into rocky debt markets
Today’s Key Market Moves
* STOCKS: Japan’s Nikkei leaps 4.75% to new peak above48,000. Europe, UK, Nasdaq, Russell 2000, MSCI World hit newrecords too, fresh closing high for S&P 500. * SHARES/SECTORS: AMD shares +24%, Philadelphiasemiconductor index hits new high. Real estate the biggest U.S.sector decliner. * FX: Japan’s yen sinks nearly 2% to 150/$, bitcoin atrecord high above $125,000. * BONDS: French yields spike, and Japanese yields surge tohistoric peaks – the 30-year yield a record 3.29%. U.S. Treasuryyields up, biggest rise in two weeks at the longer end. * COMMODITIES: Gold hits new record high of $3,970/oz,homes in on $4,000. Precious metal surge as much as 5%, oilrises almost 1% after OPEC+ ups production less than expected.
Today’s Talking Points:
* Is France really ‘uninvestable’?
France’s government collapsed on Monday within hours of being appointed after Prime Minister Sebastien Lecornu unexpectedly handed in his resignation to President Emmanuel Macron, making it the shortest-lived government in modern French history.
The French market reaction was predictable enough – stocks and bonds fell – but the big picture for the euro zone’s second largest economy is more of a worry. French bonds are now increasingly seen as riskier than Italy’s, and BCA Research has gone as far as to say French bonds are “uninvestable”.
* Japan jolts global markets
Japan’s ruling Liberal Democratic Party, which has governed Japan for almost all of the postwar era, has picked hardline conservative Sanae Takaichi as its leader, putting her on course to become the country’s first female prime minister.
