Opening Bell - Morning Commentary

US Futures Fall on Trump's New Tariff Threat Over Greenland

U.S. President Donald Trump's renewed tariff threats against European allies amid rising tensions over Greenland have revived talk of the 'Sell America' trade that emerged following his sweeping Liberation Day levies last April.

The dollar retreated to its lowest level in a week during early trading on Tuesday after White House threats toward the European Union over Greenland's future triggered a broad selloff across U.S. stocks and government bonds.

US markets were closed yesterday for Martin Luther King, Jr. Day, a federal holiday honouring the civil rights leader.

US Stock futures declined sharply after President Trump threatened 10% tariffs on eight NATO allies, beginning on February 1, escalating to 25% by June 1, over his demands regarding Greenland.

Investors are preparing for quarterly results from Netflix, Johnson & Johnson, and Intel this week as corporate guidance takes on heightened importance amid the geopolitical uncertainty.

China left its benchmark lending rates unchanged for an eighth consecutive month on Tuesday, matching market expectations. The one-year loan prime rate (LPR) held steady at 3.0%, while the five-year LPR remained at 3.5%.

Oil prices stayed volatile as economic growth data from China lifted demand optimism, even as markets tracked President Trump's tariff threats against European nations amid his interest in acquiring Greenland.

Iran's crackdown on protests has quelled civil unrest, lowering the risk of attacks that could disrupt supplies from the major Middle Eastern producer. With Iran accounting for a significant share of global output, recent indications of no immediate U.S. military intervention have helped reduce supply risks across the Persian Gulf region.

Gold resumed its advance and hit a new record high on Monday as the U.S. dollar weakened against most major peers following President Trump's latest tariff threats against Europe over Greenland.

Asian markets traded mixed on Tuesday morning amid tensions between the U.S. and the EU and rising borrowing-cost concerns, as yields on Japan's 40-year government bonds reached 4% for the first time.

The Nifty resumed its downtrend yesterday, plunging 108 points to close at 25,585, its lowest level in this ongoing correction. The sharp decline was primarily fuelled by disappointing quarterly results from blue-chip heavyweights.

Nifty has now retreated nearly 3% from its all-time high of 26,373. A decisive breach below the 25,473 mark would violate the current consolidation range, potentially accelerating the slide toward the next major support at 25,318. Meanwhile, immediate resistance has now shifted lower to 25,865.

Indian markets are positioned to open modestly higher on positive global cues.