EUROPEAN OPEN: Trump threatens Europe with tariffs over Greenland; SCOTUS to hear BAYN GY bid to curb Roundup cases; ASM NA beats Q4 expectations amid China rebound

• EUROPEAN OPEN: Stocks have come under pressure after US President Trump announced tariff threats on eight European countries over Greenland (see below). The USD fell, Treasury futures were mixed (US cash markets are shut on Monday for the Martin Luther King Day holiday). Cryptocurrencies also declined as risk assets weakened, with Bitcoin dropped to below USD 92k. Precious metals rose after the threats; gold hit a fresh record and silver jumped, while other safe havens including the CHF and JPY strengthened as trade tensions intensified. Copper advanced toward USD 13k amid the USD weakness, and also as China met its growth target. Iron ore fell on oversupply concerns after China confirmed a sharp cut in steel output, new African mine supply reached China and port stockpiles rose; China’s steel production fell more than 4% in 2025 to about 961mln tons. Oil prices fell in early Asian trading as easing Middle East tensions reduced supply disruption fears, with analysts citing recent comments from US President Trump as helping to lower the risk of immediate US action in Iran. Front-month WTI was trading near USD 59/bbl and Brent sub-USD 64/bbl. US natgas prices jumped after forecasts for the last week of January turned colder, with Arctic air expected to sweep the eastern US; the shift is set to boost demand for gas used in heating and power generation.
• GREENLAND: US President Trump said the US will impose tariffs on Denmark, Norway, Sweden, France, Germany, The UK, Netherlands and Finland over Greenland. Tariffs of 10% will start on 1st February, rising to 25% on 1st June, until a deal on Greenland is reached. Treasury Secretary Bessent said Europe is too weak to ensure its own security, backing Trump’s insistence on taking over Greenland; he dismissed EU threats to halt a tariff deal, saying Trump is using strategic leverage to achieve his aims. EU capitals are considering EUR 93bln in tariffs or market restrictions against the US after Trump's threats. Measures aim to gain leverage before Davos talks. Tariffs were prepared last year but suspended until 6th February. Leaders will hold an emergency meeting in the coming days to consider possible retaliation, an EU official said, and they plan to meet in person near the end of this week. French President Macron will seek activation of the EU’s anti-coercion instrument (ACI) as pressure grows for retaliation. EU lawmakers are also preparing to halt approval of the EU’s trade deal with the US in response. UK PM Starmer will reaffirm the UK’s commitment to NATO, and will stress the importance of the alliance; Starmer told Trump that imposing tariffs on allies in connection with NATO’s pursuit of collective security is wrong, Downing Street said. Trump’s trade threats over Greenland raise the risk European governments may cut holdings of US assets, potentially supporting the EUR, Deutsche Bank strategist George Saravelos said; Europe owns about USD 8tln of US bonds and equities, almost twice the rest of the world combined.
• STOCK SPECIFICS: Amid the Trump threats of tariffs on EU nations over their stance on Greenland, European autos, tech and luxury have come under pressure, while defence names are being supported. The UK will this week unveil plans to overhaul merger scrutiny, including abolishing the CMA panels system, curbing some jurisdictional powers and merging market studies and investigations into a single process, Sky reports. Of note for the UK property sector, asking prices for UK residential property rose at a record pace in January, signalling a rebound in market sentiment after budget-related volatility; Rightmove said average asking prices increased 2.8% M/M to GBP 368k, the largest January rise in its 25yr index history, and the sharpest monthly gain since June 2015. In tech, ASM International (ASM NA) reported Q4 revenue of EUR 698mln, above expectations and guidance, with orders of EUR 800mln; stronger bookings reflected a late-quarter rebound in China and solid advanced logic and foundry demand. ASM expects Q1 revenue to rise vs Q4 2025 levels. In industrials, Lockheed Martin (LMT) and BAE Systems (BA/ LN) were each awarded contracts under the Defense Microelectronics Activity Advanced Technology Support Program V, sharing a USD 25.36bln ceiling. BAE was also awarded a USD 204.16mln US Navy contract for maintenance, modernisation and repair of USS Iwo Jima. In materials, Aluminum Corp. of China, a major Rio Tinto (RIO LN) shareholder, is reportedly expected to support a potential acquisition of Glencore (GLEN LN) that would increase its exposure to copper; any deal would still require approval from the Chinese government, with Chinalco already said to be in talks with authorities. In healthcare, of note for Bayer (BAYN GY), the US Supreme Court announced that it will review the Durnell Roundup case; the company expects a decision on the merits during the Court’s 2026 session, which ends in June. Novartis' (NOVN SW) Lanalumab received FDA breakthrough therapy designation for Sjögren’s disease and plans global submission in early 2026.

TODAY'S AGENDA:

Today is Martin Luther King Jr. Day in the US, a market holiday. Newsquawk European coverage will begin at 06:30GMT/01:30EST, and the desk will shut at 18:00GMT/13:00EST, then re-opening on the same day for the beginning of APAC coverage at 22:00GMT/17:00EST.

• DAY AHEAD: In Europe, final HICP data for December is expected to be revised down to 2.1% Y/Y from 2.2%, while the core rate is seen revised down to 2.3% Y/Y from 2.4%. Canada inflation in December is seen rising 0.1% M/M, with the annual rate expected to fall to 2.1% Y/Y from 2.2%. The BoC will also publish its Business Outlook Survey and Survey of Consumer Expectations.
• WEEK AHEAD: Highlights include US PCE, BoJ policy announcement, China Activity Data, Flash PMIs, and inflation readings from the UK, Japan and Canada. US corporate earnings will pick up this week, with highlights from NFLX, JNJ, SCHW, PG, INTC.
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