Greenland Tariff Threats and China Data Move Markets

The US being closed for Martin Luther King Day has not stopped markets anywhere else from reacting decisively to weekend developments.

President Trump announced plans to introduce a 10% tariff on 8 European countries starting February 1st over their opposition to the US attempt to take over Greenland, further increasing political tensions.

Needless to say, European markets have been selling off this morning, led downward by the tariff-sensitive auto sector. The DAX is down 1.3%, the CAC is down 1.5%, and the FTSE is down 0.5%.

There also has been a decisive shift in capital flows from offense to defense. Cryptocurrencies are getting pounded today with Bitcoin dropping 2.2%. Meanwhile, precious metals are on the rise again with Silver soaring 5.5% and Gold gaining 1.8%.

China announced mixed economic numbers overnight with Q4 GDP (4.5% vs Street 4.4%) and industrial production (5.2% vs Street 5.0%) exceeding expectations but retail sales (0.9% vs Street 1.2%) disappointing. Market reaction has been mixed to this news. Hong Kong fell 1.1%, but Shanghai gained 0.3%. Tokyo lost 0.6%. Copper is up 0.7%.

Energy trading is mixed today. Natural gas is up 13.2% with a Noreaster rolling up the coast and temperatures falling in consuming regions. Crude Oil, however, is falling away from $60.00/bbl, down 0.7% so far this morning.

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