GLOBAL MARKETS-Shares ease as investors ponder US-Iran peace talks; yen nears 40-year lows

Global markets edged lower as U.S.-Iran peace talks were called off and as yen nears 40-year lows, testing risk appetite. The MSCI All-World index slipped 0.15%, while European shares were down 0.12% after earlier gains as investors weighed the geopolitical backdrop. The U.S. session was closed for Juneteenth, dampening liquidity and reaction. The dollar strengthened toward weekly highs, and two-year yields rose about 10 basis points versus a week ago, even as 10-year yields edged down to 4.451%. Oil traded just under $80 a barrel amid reports of a ceasefire in Lebanon and a gradual Hormuz reopening, complicating the supply outlook. Yen hovered near 161.3 per dollar as Tokyo officials warned intervention remains an option, and the dollar's strength weighed on sentiment. RBC Capital Markets analysts noted that Hormuz reopening could resemble the Red Sea pattern, with shipping activity well below pre-crisis levels. The energy market's dynamics intersect with equity flows as traders price in policy shifts from the new Fed Chair Warsh and possible gradual rate adjustments. The backdrop remains cautious, with markets parsing war-related disruption and the path toward broader Middle East stability.