By Mike Dolan

LONDON (Reuters) -What matters in U.S. and global markets today

I'm excited to announce that I'm now part of Reuters Open Interest (ROI), an essential new source for data-driven, expert commentary on market and economic trends. You can find ROI on the Reuters website, and you can follow us on LinkedIn and X.

Whatever the endgame is in the unfolding Israel-Iran war, global financial markets will take their cue from the oil markets, where prices moved up slightly today as hopes for a quick ceasefire were dashed.

I'll discuss this morning's market news below. In my column today, I explain how President Trump’s mounting pressure on the Federal Reserve could backfire.

Today's Market Minute

* U.S. President Donald Trump urged Iranians to evacuate Tehran, citing Iran's rejection of a deal to curb nuclear weapons development, as Israel and Iran attacked each other for a fifth straight day on Tuesday.

* The Group of Seven nations expressed support for Israel in a statement late on Monday, labeling Iran as a source of instability in the Middle East, with the G7 leaders urging broader de-escalation of hostilities in the region.

* The Bank of Japan kept interest rates unchanged on Tuesday and announced that it would decelerate the pace of its balance sheet drawdown next year.

* Critical energy infrastructure in Israel and Iran has not escaped unscathed from the first few days of the countries' escalated conflict. Worst-case scenarios have yet to be realized, but the war is already having a notable impact on energy production and exports in both countries, writes Roi energy columnist Ron Bousso.

* China has built up crude oil stockpiles while refining substantially less than what it has available from imports and domestic production, which will likely enable the world's biggest oil importer to buy lower volumes in the coming months if prices surge over Middle East tensions, writes ROI Asia commodities columnist Clyde Russell.

Oil contained as Mideast war wages

Despite reports on Monday that Iran was pushing for a ceasefire, the two sides continued to bombard each other overnight.

U.S. President Donald Trump left the G7 summit in Canada early to focus on the crisis, issuing an alarming evacuation warning to the residents of Tehran in the process.

While U.S. crude prices edged back up above $72 per barrel again on Tuesday, they remain below Friday's close and almost 8% lower than they were this time last year.

For now at least, neither Iran's major oil export installations nor the critical regional waterway of the Straits of Hormuz have been closed off.