Nikkei 225, Kospi, Hang Seng Index

Asia-Pacific markets were mostly lower on Monday as investors weighed renewed U.S. tariff threats tied to Greenland, raising concerns about escalating trade tensions with Europe.

European states are reportedly discussing counter-tariffs and broader punitive economic measures in response to President Donald Trump’s new tariff threats, further straining relations over Greenland.

On Saturday, Trump announced that exports from eight European countries would start at 10% on Feb. 1 and climb to 25% by June 1 if talks to take U.S. control of Greenland, a mineral-rich, semi-autonomous island under Danish control, fail.

of hong kong Hang Seng Index It rose 0.1%, while the CSI 300 in mainland China traded flat following increased regulatory scrutiny following a surge in trading activity.

Authorities moved to rein in leverage after turnover on the onshore market reached record levels, partly driven by margin trading balances rising to an all-time high.

Despite the tightening, Standard Chartered’s Raymond Cheng said the bank was bullish on China A shares, citing the economy as stabilizing and fiscal policy support expected at China’s policy meetings in March 2026.

“We view the strength of Chinese equities as sustainable given policy stimulus that will add further upside to our projected mid-teens earnings growth over the next 12 months,” the bank’s regional chief investment officer for Greater China said. he said.

Investors are closely monitoring developments in Japanese markets after Prime Minister Sanae Takaichi said on Monday that he plans to dissolve parliament and call early elections on February 8.

of japan Nikkei 225 It fell 0.7% while the Topix fell 0.52%. South Korea’s Kospi index fell 0.41%, while the small-cap Kosdaq traded flat.

The yield on Japan’s 40-year government bond rose to 4% for the first time.

Japan’s ruling coalition has a one-seat Lower House majority since its formation in October, when Takaichi became prime minister following the resignation of his predecessor. Fitch Group said in a note that early elections would increase political uncertainty in the short term but could bring greater policy clarity if a government with a stronger mandate emerges.

Fitch expects government debt to remain high over the medium term but decline gradually as stronger nominal GDP growth offsets wider fiscal deficits and higher borrowing costs.

Consolidated general government debt is projected to decline to the mid-range of 190% of GDP by fiscal 2029, from an estimated peak of 199.5% in fiscal 2025 and 222% in fiscal 2020.

Australia’s S&P/ASX 200 index lost 0.46%.

US stock futures pointed to a negative session on Wall Street as Trump intensified his rhetoric towards Greenland.