(The opinions expressed here are those of the author, a

columnist for Reuters.)

By Mike Dolan

LONDON, July 21 (Reuters) - What matters in U.S. and

global markets today

By Mike Dolan, Editor-At-Large, Finance and Markets

Japan's yen strengthened on Monday as embattled Prime Minister

Shigeru Ishiba vowed to stay on as leader even after his ruling

coalition lost its majority in Sunday's upper house elections.

I'll dive into this and the rest of today's market news below.

Make sure to check out today's column, where I discuss why a

sudden shift in the euro and the threat of U.S. tariffs may give

the European Central Bank a reason to pause rate cuts, even as

deeper tensions may be quietly building.

Today's Market Minute

* Japan's ruling coalition lost control of the upper house in an

election on Sunday, further weakening Prime Minister Shigeru

Ishiba's grip on power even as he vowed to remain party leader,

citing a looming tariff deadline with the United States.

* The fringe far-right Sanseito party emerged as one of the

biggest winners in Japan's upper house election on Sunday,

gaining support with warnings of a "silent invasion" of

immigrants, and pledges for tax cuts and welfare spending.

* BP named Albert Manifold, the former boss of building

materials producer CRH, as its new chairman on Monday, as it

looks to address investor concerns about its strategy and weak

share performance.

* The high-stakes clash between Exxon Mobil and Chevron over a

prized South American oilfield may be a sign of what's to come

in the oil and gas industry as competition for a shrinking pool

of prime assets heats up, writes ROI energy columnist Ron

Bousso.

* Asia's run of subdued imports of liquefied natural gas is set

to extend for another month in July, with the top-importing

region on track for a tiny increase from June. Read the latest

from ROI columnist Clyde Russell.

Yen bounces as Japan PM hangs on

With markets rushing to price 'worst case' scenarios earlier

this month, including the chance of a leadership hiatus just as

next week's August 1 tariff deadline hits, the outcome was seen

as something of a relief. Even though pressure remains on

Ishiba, his pledge to remain as PM offers at least some focus

for any last minute trade negotiations.

Japanese markets were closed for a holiday and global

currency markets offered the only clear sign of a reaction. The

yen, which had hit a three-month low of 149.18 per dollar

last week, firmed to just under 147.7 after the results. That

dragged the dollar down across the board.

The other big movers first thing have been in global bond

markets, where U.S. Treasury yields and European equivalents -

perhaps in some read-across to Japanese investor flows - fell

notably.

Treasury yields fell across the curve to 10-day lows - after

rallying last week on a combination of benign producer price and

inflation expectations readings as well as comments from Federal

Reserve board dove Christopher Waller that he's still in favor

of resuming interest rate cuts as soon as this month.

Waller said on Friday he would accept the job as head of the

U.S. central bank if asked by President Donald Trump, but so far

Trump had not contacted him about it.

With the Fed outlook now confused by persistent White House

pressure on Chair Jerome Powell and the outside chance that

Trump attempts to fire him before his term expires next year,

last week's incoming price data has offered some comfort.

Fed futures reflect a near 70% chance of another Fed cut by

September.

But the Wall Street Journal reported on Monday that Treasury

Secretary Scott Bessent had counseled Trump not to fire Powell,

given the financial disruption that might cause.

Trump, who sued the WSJ and its owners including Rupert Murdoch

for at least $10 billion on Friday over the newspaper's report

on a 2003 birthday greeting from Trump to sex offender Jeffrey

Epstein, denied the latest WSJ report on Bessent too.

Stock markets were steady to higher across the world, with

Wall Street stock futures up ahead Monday's bell.

Helping the mood, U.S. Commerce Secretary Howard Lutnick said on

Sunday he was confident that Washington can secure a trade deal

with the European Union, but August 1 is a hard deadline for

tariffs to kick in. Lutnick said he had just gotten off the

phone with European trade negotiators and there was "plenty of

room" for agreement.

Meantime, China's foreign ministry said European Commission

President Ursula von der Leyen and European Council President

Antonio Costa will meet with Chinese President Xi Jinping on

Thursday.

The corporate earnings season unfolds during the week,

meantime, with Tesla and Alphabet - two underperforming megacaps

this year - reporting on Wednesday.

In Europe, Ryanair surged more than 6% as Europe's

largest low-cost carrier's net profit more than doubled in its

April-June quarter.

Chart of the day

China's exports of rare earth magnets to the United States in

June soared to more than seven times their May level, marking a

sharp recovery in the flow of critical minerals used in electric

vehicles, wind turbines and missiles after a Sino-U.S. trade

deal. China, which provides more than 90% of the global supply

of rare earth magnets, decided in early April to add several

rare earth items to its export restriction list in retaliation

for U.S. tariffs - creating major supply chain problems for many

firms and industries.

But the two countries hammered out an agreement last month to

resolve the issue - one in which Washington allowed chipmaker

Nvidia ( NVDA ) to resume sales of its H20 AI chips to China.

Separately, China has quietly issued its first 2025 rare earth

mining and smelting quotas without the typical public statement

- another sign of Beijing tightening its control over the

crucial sector.

Today's events to watch

* U.S. June leading indicator (8:30 AM EDT); Canada June

producer price report

* U.S. corporate earnings: Verizon, Domino's Pizza, Steel

Dynamics, WR Berkley, NXP, Roper, Alexandria Real Estate

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