Equity markets surge due to rate-lowering expectations, international currencies experience turbulence from political turmoil worldwide

Global Markets and Politics: A Round-Up

Gold prices surged past $3,600 an ounce for the first time on Monday, with U.S. gold futures rising 0.66% to $3,637.10 an ounce. This surge was mirrored in spot gold, which rose 1.37% to $3,635.26 an ounce.

The U.S. dollar extended its Friday losses, with the dollar index falling 0.42% to 97.46. The euro rose 0.36% on the dollar to $1.1759, marking a strong performance against the greenback.

In the bond market, the yield on benchmark U.S. 10-year notes fell 3.9 basis points to 4.047%. This decline in yields was observed across the globe, as U.S. Treasury yields declined on Monday.

Stock markets also saw mixed performances. MSCI's gauge of stocks across the globe rose 3.67 points, or 0.38%, while the S&P 500 and Nasdaq Composite reached record closing highs. The S&P 500 rose 13.65 points, and the Nasdaq Composite rose 98.31 points. However, the Dow Jones Industrial Average closed up 114.09 points, reaching a new record high of 45,514.95.

In contrast, the Argentine benchmark stock index [.MERV] fell 13.25%, and an index of Argentine stocks traded on U.S. exchanges [.BKAR] lost 18.6%. These declines were attributed to a heavy election defeat for Argentina President Javier Milei's ruling party in Buenos Aires province, which led to the Argentine peso reaching a record low.

Political instability was also seen in France, where the French government was brought down over its plans to tame the ballooning national debt, deepening a political crisis. The possible future, more market-friendly Prime Minister of Japan expected in a potential government change is Toshimitsu Motegi, who is seen as a representative of the established party wing and is one of the main candidates to succeed Shigeru Ishiba after his resignation.

The oil market saw a slight increase, with U.S. crude settling up 0.63%, reaching $62.26 a barrel. Brent ended at $66.02 per barrel, rising 0.79% or 52 cents on the day.

In a significant political development, Japanese Prime Minister Shigeru Ishiba resigned on Sunday, leaving the door open for a potential government change. Meanwhile, Francois Bayrou, France's fourth prime minister in less than two years, lost a confidence vote on Monday, further deepening the political crisis in the country.

Overall, Monday saw a mix of economic and political developments, with gold prices reaching new highs, stock markets showing mixed performances, and political instability in several key countries.

Equity markets surge due to rate-lowering expectations, international currencies experience turbulence from political turmoil worldwide