Asian Stocks Rise Amid Caution, Dollar Inches Up

Asian stocks exhibited an uptick in early trading, although caution prevailed due to concerns over potential global repercussions stemming from President Trump's latest trade and sanction actions against Colombia. The situation remains fluid as the US dollar witnessed a slight increase.

Key Market Movements

* Japanese benchmarks surged, while Hong Kong futures indicated modest gains at the open.
* US equity futures declined, partially reversing last week's impressive performance that marked the strongest start to a presidential term since 1985.
* Australian stock and bond markets remained closed for a holiday.
* Following last week's global market rebound, fears of a trade war have resurfaced following Trump's announcement of punitive sanctions on Colombia.
* Wee Khoon Chong, strategist at BNY in Hong Kong, cautioned, "It is premature to assume that tariff threats have subsided. Asia's vulnerability to trade uncertainties persists."

Currency Performance

* The US dollar edged higher after the sanctions on Colombia, while the Mexican peso experienced a decline.
* The move moderates the greenback's significant slump recorded last week.

Upcoming Events and Factors

* Chinese economic data, scheduled for release on Monday, may shed light on the momentum of the manufacturing sector.
* Thin trading volume, as major centers prepare to close for the Lunar New Year, may exacerbate market movements.
* The commencement of the US tech earnings season will be closely monitored, particularly regarding demand for artificial intelligence.
* The US Federal Reserve is expected to maintain interest rates steady on Wednesday.

Commodities and Other Markets

* Oil posted its first weekly decline this year, spurred by Trump's threats against Russia and OPEC+.
* Coffee prices will be under observation following the tariffs imposed on Colombia.
* Bitcoin retreated after hitting a new record last week, while gold extended its weekly gains.

Key Events This Week

* Monday: China industrial profits, manufacturing PMI
* Tuesday: US consumer confidence, durable goods
* Wednesday: Australia CPI, US rate decision, Tesla earnings
* Thursday: Eurozone consumer confidence, ECB rate decision
* Friday: US GDP, personal income, spending