Asia-Pacific markets mixed

US stock indices fell sharply on Monday as concerns rose over the disruptive effects of AI. At the end of last week, Anthropic announced the release of Claude Code Security, an AI-powered tool designed to identify and help fix software vulnerabilities. This triggered a sharp selloff across cybersecurity stocks.

This follows the release of Claude Cowork, which led to the rout across software company stocks. Now investors are wondering which sector is next in line to take an AI-related hit.

Investors were also considering the fresh trade uncertainty after Friday’s US Supreme Court ruling blocked tariffs imposed last April under the International Emergency Economic Powers Act (IEEPA).

Equities initially rallied on the news but then turned down as President Trump immediately announced a new 10% (then raised to 15%, before being cut to 10%) worldwide tariff on all US imports. This is legal and can run for 150 days before it must go before Congress for an extension.

But much of this tariff news was already factored in. While it is yet another wrinkle for investors to consider, and as it does add to uncertainty to some extent, the underlying issue for stock markets is that they have lost their upside momentum.  

Yesterday, the S&P 500 fell 1%, the NASDAQ dropped 1.1%, and the Russell 2000 lost 1.6%. The Dow Jones slumped 1.7%, weighed down by a 13% plunge in IBM. Technology and software stocks bore the brunt of the selloff. Tesla, Microsoft, Amazon, CrowdStrike and several other cybersecurity names declined sharply.

Source: TN Trader

Investors are now turning their attention to an uptick in the earnings calendar. Nvidia’s results on Wednesday are seen as pivotal for broader sentiment toward AI-related corporations. Earnings from software giants Salesforce, Snowflake and Workday are also in focus, with investors watching closely for evidence that these companies can defend margins and relevance amid rapid technological change.

Overnight, President Trump will deliver his State of the Union address to Congress. But before then, today sees a stack of FOMC members deliver speeches. It’s worth bearing in mind that the probability of a 25-basis point rate cut in June has declined, although the odds still favour 50 basis points-worth of cuts before year-end.

US stock index futures were a touch firmer in early trade. But they continue to move sideways and remain rangebound for now.

European equities opened lower on Tuesday. Investors reassessed the global trade landscape following President Trump’s response to the US Supreme Court blocking his Liberation Day tariffs, first introduced last April. The Euro Stoxx 50 pulled back from yesterday’s all-time intra-day high, while all the other major European indices, along with the UK’s FTSE 100, traded in negative territory.

Source: TN Trader

The European Parliament confirmed it had paused work on ratifying the US–EU trade deal agreed last summer, citing uncertainty surrounding the new US tariff framework. President Trump reiterated that countries attempting to “play games” with recent trade agreements would face higher duties under alternative trade laws.

In corporate news, Standard Chartered shares fell 0.8% after the lender reported a 16% jump in pre-tax profit that nevertheless missed expectations. JD Sports rallied on buyback news, and Rolls-Royce slipped ahead of its own results. The Danish pharmaceutical giant, Novo Nordisk, dropped 15% at one stage following poor results from the latest trials of its ‘next generation’ weight loss drug.

The Japanese yen fell sharply overnight against all the majors as political resistance to further tightening of monetary policy emerged. Japanese Prime Minister Sanae Takaichi voiced concerns over additional rate hikes in discussions with Kazuo Ueda, complicating the Bank of Japan’s policy outlook. The USD/JPY shot above 156.00 to hit its highest level in a fortnight.

Meanwhile, the US Dollar Index was little changed from yesterday, and managed to hold on to most of its gains, having bounced back after a tariff-triggered selloff on Friday and Sunday night. The dollar was supported by safe-haven demand and hawkish undertones from Federal Reserve officials, despite lingering tariff uncertainty.

Source: TN Trader

Gold surged higher yesterday to hit its highest level in over three weeks. It briefly topped $5,250 as traders rushed in to buy. The rally was underpinned by trade uncertainty, geopolitical risk and expectations that US rate cuts later in the year could limit dollar upside.

Gold has pulled back from yesterday’s high and has dropped below $5,200 by mid-morning on Tuesday. Yet the downside appears to be limited by concerns over President Trump’s tariff strategy and ongoing tensions in the Middle East ahead of renewed US–Iran nuclear talks.

Source: TN Trader

Fed officials have signalled caution on easing monetary policy too quickly. Yet markets continue to price in at least two 25-basis point rate cuts in 2026, which should prove a supportive backdrop for non-yielding assets.

Silver pulled back modestly after four days of gains. But it continues to get support from its daily MACD, which has curled up from relatively oversold conditions. 

Source: TN Trader

Crude oil was firmer overnight, building on Monday’s gains. But it drifted lower in the early hours of this morning, although front-month WTI continues to trade above $66 per barrel. Yesterday’s rally took oil prices up to their best levels in six-months.

Source: TN Trader

Support came from concerns over potential supply disruptions amid renewed US–Iran tensions. A third round of talks is scheduled in Geneva this week, although President Trump warned of severe consequences should negotiations fail.

But the upside remains capped by forecasts from the US Energy Information Administration, which point to a sharp rise in global oil inventories this year as production growth outpaces demand.

Bitcoin slid below $63,000 in early trade this morning, extending its monthly decline to nearly 30% and highlighting deeper structural fragility. Technical charts show a developing head-and-shoulders pattern, with the $60,000 level emerging as a critical support zone.

The selloff has coincided with the longest miner capitulation phase of the year, according to Glassnode data, as falling revenues force sustained reserve selling. Institutional demand has also deteriorated, with ETF flows weakening further, compounding downside pressure and increasing the risk of a decisive break lower.

The VIX edged higher overnight, reflecting renewed unease as President Trump signalled his team was preparing the reintroduction of reciprocal tariffs under alternative legal frameworks. While volatility remains far from crisis levels, the move underscores a market increasingly sensitive to policy shocks and headline-driven risk.

In short, risk appetite remains fragile. Tariff escalation, AI-driven disruption and geopolitical uncertainty are keeping investors defensive, even as pockets of strength persist in energy and other commodities. With major earnings, macro data and policy headlines ahead, markets may well be in for another volatile week.