A Reuters Open Interest newsletter

Making sense of the forces driving global markets

By Jamie McGeever, Markets Columnist 

Global stocks were mixed on Monday - optimism over Middle East peace talks lifted Asia and Europe, while tech and interest rate jitters weighed on Wall Street - as investors also absorbed the resignation of UK prime minister Keir Starmer and death of former Fed Chair Alan Greenspan. 

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* Yen-tervention, where art thou?

Japan's yen on Monday sank deeper into the 'intervention zone', hitting a two-year low and almost touching 162 per dollar, a level that was last breached 40 years ago. It briefly snapped higher to 161 per dollar, a possible indication of official intervention, but ended U.S. trading around 161.50.

It would appear Japanese authorities have not intervened. This may be puzzling, as Tokyo has previously and recently bought huge quantities of yen around these levels. But with oil down 40% from its May peak, the Nikkei exploding to record highs and the Fed seemingly turning hawkish, perhaps it shouldn't be.

* Starmer quits

Britain will soon have its seventh prime minister in 10 years. A day from the 10th anniversary of the Brexit referendum and barely two years after securing a landslide general election victory, Keir Starmer on Monday announced that he intends to step down. 

Frontrunner Andy Burnham is expected to replace him, perhaps as early as next month. For markets, the key issues are Burnham's stance on Britain's fiscal rules, and his pick for finance minister. Markets are sanguine, at least initially - sterling and UK stocks rose on Monday, gilts were mostly steady.  

* Alan Greenspan remembered

Former Fed Chair Alan Greenspan died on Monday, aged 100. He was dubbed 'the maestro' by admirers for guiding the U.S. economy and markets through boom times, but also came under heavy fire from critics who pointed to the eponymous 'Greenspan put' as evidence he was too in thrall to markets. 

Whichever side of that argument you fall on, there's no debating his towering presence over the Fed and global central banking, not just during the 19 years of his chairmanship, but beyond.