BY EMMANUEL OGBONNA
U.S. financial markets were poised for a subdued start on Monday, with stock futures pointing to modest losses as investors weighed weather-related disruptions, currency volatility and mounting geopolitical and trade uncertainties. In Asia, Japanese shares led regional declines after a sharp rebound in the yen sparked heavy selling in export-oriented stocks.
Futures tied to the S&P 500 slipped 0.1% ahead of the opening bell, while contracts for the Dow Jones Industrial Average were largely flat. Nasdaq futures fell 0.2%, reflecting cautious sentiment as investors prepared for a busy week of corporate earnings and a closely watched meeting of the U.S. Federal Reserve.
Shares of major U.S. airlines came under pressure in early trading, with most carriers falling more than 1% after thousands of flights were canceled or delayed by a massive winter storm. The storm swept from the Rocky Mountains to the East Coast, bringing heavy snow, ice and freezing temperatures that snarled travel, knocked out power in some regions and disrupted supply chains.
Energy markets reflected the impact of the cold snap. U.S. natural gas futures surged another 4.5% as frigid weather boosted heating demand nationwide. In some areas, snowfall exceeded a foot, straining infrastructure and leaving many households without electricity.
In Asia, Japan’s Nikkei 225 dropped 1.8% to close at 52,885.25, with losses concentrated among large exporters. Toyota Motor Corp. slid 4.1%, underscoring investor concerns that a stronger yen could erode overseas earnings when repatriated into local currency.
The sell-off followed a sharp appreciation of the yen against the U.S. dollar, fueled by speculation that Japanese authorities, potentially in coordination with U.S. officials, may be preparing to intervene in currency markets. While finance officials in Tokyo stopped short of confirming any imminent action, they acknowledged close communication with Washington regarding excessive currency moves.
“Intervention chatter did the trick,” said Ipek Ozkardeskaya, a senior analyst at Swissquote. She noted that the yen’s rapid rebound since late last week reflected growing expectations that policymakers would act to stabilize the currency.
A weaker yen has generally supported Japanese exporters by inflating the value of foreign revenues. However, the currency’s prolonged decline since 2021 has also driven up the cost of imported food, fuel and raw materials, squeezing households and businesses in the world’s fourth-largest economy. The recent strengthening of the yen reversed part of that trend, with the dollar falling to 154.14 yen from 155.01 yen, after trading near 158 yen just days earlier.
Precious metals surged as investors sought safe-haven assets amid geopolitical tensions and market volatility. Gold rose another 2%, briefly pushing above $5,100 an ounce, while silver jumped 8.5% to $110.04 per ounce. Prices for both metals have climbed sharply in recent months as uncertainty over global growth, trade policy and conflicts has intensified.
Attention this week is expected to center on corporate earnings, with investors looking for signs of how recent U.S. tariff policies are affecting profitability. Among the companies scheduled to report are United Airlines, Boeing, General Motors, Meta, Microsoft and Apple, results that could shape market direction in the days ahead.
Trade policy developments are also in focus after U.S. President Donald Trump renewed threats to impose a 100% tariff on Canadian goods if Ottawa pursued a free trade agreement with China. Canadian Prime Minister Mark Carney pushed back, saying Canada has no plans to sign such a deal.
Canada last year aligned with the United States by imposing a 100% tariff on electric vehicles from China and a 25% tariff on Chinese steel and aluminum. Beijing responded with steep import taxes on Canadian canola oil, meal, pork and seafood. Earlier this month, however, Carney diverged from Washington during a visit to China, agreeing to cut Canada’s tariff on Chinese electric vehicles in exchange for reduced duties on Canadian agricultural exports.
Markets will also be closely watching the Federal Reserve, which meets this week to decide the future path of U.S. interest rates. Most economists expect policymakers to leave rates unchanged after a series of cuts at the final three meetings of 2025, as officials assess inflation trends and the broader economic outlook.
Elsewhere in Asia, South Korea’s Kospi fell 0.8% to 4,949.59. Hong Kong’s Hang Seng Index edged up less than 0.1% to 26,765.52 after a volatile session, while China’s Shanghai Composite slipped nearly 0.1% to 4,132.60. Markets were closed for holidays in Australia, New Zealand, India and Indonesia.
European markets were mixed at midday, with France’s CAC 40 down nearly 0.2%, Britain’s FTSE 100 up 0.2%, and Germany’s DAX trading flat.
In energy trading, oil prices eased slightly. U.S. benchmark crude fell 14 cents to $60.93 a barrel, while Brent crude, the international standard, slipped 8 cents to $64.99 a barrel, as traders balanced weather-driven demand against concerns about global economic growth.