President Obama earned the dubious distinction of having fewer experienced business people in his cabinet than any other administration in modern times. President-elect Trump seems to be going for the opposite honor. In addition to Commerce Secretary-designate Wilbur Ross and Treasury Secretary-designate Steve Mnuchin, he is said to be leaning toward ExxonMobil CEO Rex Tillerson to be Secretary of State and Goldman Sachs veteran Gary Cohn to head the National Economic Council. (Goldman Sachs, incidentally, is one of the biggest beneficiaries of the “Trump Bump” in the stock market, accounting for 29% of the Dow’s recent rise.)

Tillerson is a particularly interesting choice. He is an engineer and a respected businessman – smart, focused, some would say arrogant. Steve Coll, who authored a book entitled Private Empire: ExxonMobil and American Power, wrote over the weekend that Tillerson’s life has been largely shaped by two institutions: ExxonMobil and the Boy Scouts. Like the man he may serve, he has little tolerance for political correctness. And while he has never served in government, he runs a company that is, as Coll’s book argues, a sort of independent state that must maintain diplomatic relations with some of the most difficult countries and regions in the world.

Tillerson’s biggest foray into national politics was his advocacy of the Common Core standards for education, which he pushed relentlessly as the Business Roundtable’s education chair. As Fortune’s Peter Elkind chronicled last year, Tillerson was so convinced of the essential rightness of his position that he missed a rising grass-roots backlash, and appeared tone-deaf to the political challenge.

Tillerson also shares Trump’s disdain for the press. When I interviewed him before the Council on Foreign Relations in 2012, he attacked journalists as “lazy.” “They just don’t do their homework,” he added. When I suggested he might be painting the media with too broad a brush, he replied: “There are probably a couple of camel hairs in the brush that don’t apply.”

But the issue that has come to the fore is Tillerson’s business relationship with Russia. Sen. John McCain told Fox News the Exxon chief’s relationship with Vladimir Putin is a “matter of concern to me.” Those concerns are also being fed by weekend reports about Russia’s efforts to influence the U.S. elections.

Meanwhile, Trump’s war of words with China also heated up over the weekend. The President-elect said in an interview, “I don’t know why we have to be bound by a one-China policy” that recognizes Taiwan as part of China. A spokesman for the Chinese foreign ministry responded today that “upholding the one-China principle is the political basis” for China-U.S. ties.

More news below.

Top News

• Oil, Bond Yields Soar as Markets Brace for Fed Hike

Financial markets have opened the week with a bang as they position for an expected rate hike from the Federal Reserve. Yields on 10-year Treasury bonds have hit 2.5% for the first time in over two years, while 30-year yields hit a 17-month high of 3.20%. Expectations of higher inflation were bolstered by weekend news that oil producing countries outside OPEC committed to cut their daily output by over 550,000 barrels a day, a development that makes the 1.2 million barrel/day OPEC output cut more likely to stick. Saudi Arabia, which had insisted on such cooperation from non-members, hinted that it could now even cut output by more than agreed. U.S. crude oil prices are up nearly 5% on the news at just under $54 a barrel. Shale producers, who added 21 drilling rigs last week in their most bullish week since January, are licking their lips. Bloomberg

• Boeing Clinches Iran Deal

Boeing sealed its deal to sell 80 airliners to Iran. Announced tentatively in June, the $17 billion deal is by far the biggest between a U.S. company and the Islamic Republic since the lifting of sanctions. Now for the hard part: negotiating the Washington minefield. President-elect Donald Trump publicly rebuked the company for overcharging last week, and Trump has also said he’ll overturn the Iran deal, a policy that commands some strong support on the Hill. Both the administration and Congress will have the opportunity to scupper the deal next year. By the by, Iranian officials said they were also close to finalizing an order for 118 planes from Airbus, which will face little such political opposition at home in Europe. Fortune

• Gentiloni Does It

Italy’s titular head of state Sergio Mattarella asked outgoing Foreign Minister Paolo Gentiloni to put together a ‘technocratic’ new government. Most of Italy’s political parties are pressing for snap elections but it’s not clear how quickly the current constitutional mess (in the wake of last weekend’s failed referendum) will allow that. What is much clearer is that the banking sector is approaching crisis point. The ECB on Friday rejected an appeal to extend the deadline for Monte dei Paschi’s capital raising beyond year-end. In more positive news, Unicredit, the only globally important Italian bank, agreed to sell its Pioneer asset management unit to France’s Amundi for $3.7 billion, adding to the $2.6 billion it got from selling its stake in Poland’s largest bank last week. Bank stocks have opened the week up, relieved at the prospect of a new administration being formed relatively quickly (by Italian standards). ItalyEurope24

• Turkey’s Political Chaos Spreads to Economy, Markets

Turkey’s economy is getting a battering from the country’s political upheavals. Gross domestic product fell by a shocking 1.8% in the three months to September (an annualized 7.2%), the period covering the failed coup against President Recep Tayyip Erdogan and his subsequent indiscriminate retribution against secular and Kurdish elements of Turkish society. The lira, already the worst-performing currency among major emerging markets this year, fell another 1.5% Monday, on a combination of the GDP news and the soccer stadium bombings in Istanbul at the weekend that killed 38 people and wounded 155. Turkish militants claimed responsibility for the attacks, fostering fears that the conflict in the remote east of the country is spreading.  Fortune

Around the Water Cooler

• The Much Less Dirty (Two) Dozen

Nearly two dozen of the world’s most successful business leaders, entrepreneurs, and venture capitalists will invest up to $1 billion in a clean energy fund led by Microsoft co-founder Bill Gates. The news will be a welcome morale boost for a sector unsettled by the incoming administration’s apparent lack of sympathy for it. The Breakthrough Energy Ventures Fund includes John Doerr, chairman of venture firm Kleiner Perkins Caufield & Byers, Alibaba founder Jack Ma, Khosla Ventures founder Vinod Khosla, Laura and John Arnold Foundation co-chair and former energy hedge fund manager John Arnold, Amazon founder and CEO Jeff Bezos, and SAP co-founder Hasso Plattner. The fund will put money into anything from startups all the way to companies that have reached commercialization. It will consider a broad range of sub-sectors, including electricity generation and storage, transportation, industrial system use, agriculture, and energy system efficiency. Fortune

• Special Price for Our American Friends!

Another twist in the ongoing saga over Chinese outbound investment: Apollo Global Management is buying Philips’ lighting business LumiLEDs for a cut-price $2 billion, just under a year after the U.S. Treasury blocked a sale to China’s Go Scale for $2.8 billion for undisclosed reasons. LumiLEDs lights are found in one in three cars worldwide, but the Treasury’s action provoked speculation that it also had intellectual property in much more sensitive areas. The deal comes only weeks after the Treasury also killed German semiconductor company Aixtron’s plans to sell itself to a Chinese group. Philips’ shares fell over 1% on the news. Fortune

• Honda Grabs a Piece of…Grab

It emerged at the weekend that Honda Motor had invested in Grab, a ride-hailing service that operates across South-East Asia (in the course of a separate announcement about a new but vague partnership between the two relating to motorcycles). Grab last made news by piloting a driverless taxi scheme in Singapore together with startup nuTonomy. The array of competitors to Uber is not small, and while they may lack the same aggregate degree of backing from private investors, they are increasingly well funded by companies with clear strategic interests at stake, and with plenty of lobbying power of their own. That will complicate Uber’s plans to gain market dominance and monetize its app to the degree that its backers have assumed. Fortune

• Lagarde to Stand Trial

International Monetary Fund managing director Christine Lagarde goes on trial Monday, accused of negligence during her time as French finance minister after an over-generous settlement to an ally of then-President Nicolas Sarkozy. The trial is due to last until Dec. 20 and Lagarde faces up to a year in prison if convicted. A conviction could open up a big can of worms at the IMF, where the U.S. may be tiring of approving scandal-plagued Europeans. A vacancy there would indulge the new administration’s love of deal-making in some style, while a non-European head would certainly complicate the IMF’s relationship with the Eurozone. Fortune

Summaries by Geoffrey Smith Geoffrey.smith@fortune.com;

@geoffreytsmith