[MARKET ANALYSIS] Asia-Pac equities outperform US and EU equity futures as EU-US trade tensions re-emerge following disagreement over Greenland

• Asia-Pac stocks opened mostly in the red as markets react to the increased trade tensions between the US and Europe, but have pared back some losses.
• ASX 200 started the week with modest losses, with IT and Financials weighing on the index. Gold and Utilities are helping limit the downside in the ASX as spot XAU hits a new ATH.
• Nikkei 225 has been hit the hardest, with losses as much as 1.5%. This comes amid a strengthening JPY as a safe-haven bid spreads throughout markets.
• KOSPI outperforms its global peers, extending on its ATHs, as South Korea and China prepare for a new round of free-trade negotiations.
• Hang Seng and Shanghai Comp. initially started the Asia-Pac session on the back foot but are starting to diverge as the session continues, with the Shanghai Comp. shifting into the green while the Hang Seng extends on earlier losses. China released its GDP figures, with the Q4 figure beating expectations and 2025 hitting China’s target. However, equities didn’t react to the data.
• US equity futures gapped lower and are holding onto earlier losses following the re-emergence of US-EU trade tensions.
• European equity futures are indicative of a negative open with the Euro Stoxx 50 future down 1.1% after cash closed -0.3% on Friday.

The resurgence of trade tensions between the US and Europe, particularly related to Greenland, is impacting global equity markets, with Asia-Pac equities showing mixed responses. While some indices like the Nikkei 225 face pressure due to a strengthening JPY, others like KOSPI are outperforming as they benefit from potential trade negotiations with China. Traders should focus on how these geopolitical factors are influencing risk sentiment and capital flows across regions, especially as US and European futures indicate a negative sentiment ahead.