27th January 2026

MACRO

Trump Threatens 25% Tariffs on South Korea

Trump threatened to hike tariffs on South Korean goods to 25% from 15%, citing the failure of Seoul’s legislature to codify last year’s trade deal. The new rate would apply to autos, lumber, pharmaceuticals and “all other Reciprocal TARIFFS.”

Canadian PM Mark Carney “aggressively” walked back comments he made at Davos during a call with Trump on Monday, according to Treasury Secretary Bessent.

(Truth Social, Reuters)

Medicare Insurers Hammered on Flat Rate Proposal

The Trump administration is proposing roughly flat rates for Medicare insurers next year - well short of Wall Street expectations. UnitedHealth, Humana and CVS all saw heavy losses in after-hours trading.

Congress is running out of time to pass appropriations before funding expires at 12:01 am ET Saturday. Senate Democrats say they won’t support the bill without changes to Homeland Security provisions. The annual tax-filing season that opened Monday will produce an estimated $100 billion cash surge beyond last year’s $329 billion total.

(Wall Street Journal)

Big Tech Dominating Corporate Bond Market

By 2030, half of the 10 largest borrowers in the US investment-grade corporate bond market will be hyperscalers - Alphabet, Amazon, Meta, Microsoft and Oracle building colossal data centres - according to Apollo Global Management.

Texas is barring state employees from using Shein, Alibaba and TP-Link hardware and software to protect “privacy of Texans” from the Chinese government.

(Financial Times, Reuters)

Japan: Yen Steadies as Takaichi Campaigns

The yen steadied as PM Takaichi started her election campaign. A leading indicator of Japan’s services sector prices rose 2.6% year-on-year in December, backing the BOJ’s view that labour shortages will continue to prod companies to pass on rising costs.

A plan to build a synthetic diamond plant in the US is a prime prospect in Japan’s $550 billion investment package, as the allies push to expand production of materials vital to chip manufacturing. It could be among the first projects unveiled ahead of Takaichi’s US visit, planned as early as March.

(Financial Times, Reuters)

China Industrial Profits Rise for First Time Since 2021

Chinese industrial profits rose last year for the first time since 2021, as the campaign against price wars and excessive competition relieved pressure on corporate earnings. China will issue a policy document addressing AI’s impact on employment with support measures for key industries.

German companies’ investments in China hit a four-year high in 2025, underscoring how Trump’s trade war is pushing industries to boost business ties elsewhere.

(Reuters, Xinhua)

India-EU Free Trade Deal Announced

India and the EU have reached a free trade agreement opening India’s vast market to European cars and other products. India accounted for about 2% of EU goods trade in 2024. The agreement follows India’s move to slash car tariffs from as high as 110% to 40%.

(Wall Street Journal)

UK: Starmer Visits China, BOE Expected to Hold

PM Starmer will fly to China today - the first visit by a British leader in eight years - seeking to mend ties and reduce dependence on an increasingly unpredictable US. The government plans to tighten scrutiny of Chinese activity within its Foreign Influence Registration Scheme without placing Beijing in the same bracket as Moscow and Tehran.

The Bank of England will hold rates at 3.75% at its February meeting, according to all but two economists polled by Reuters. Only 55% now expect a cut by end-March, down from 72% in December. Shop price inflation rose in January to the highest since early 2024 as higher energy costs and taxes spread through the economy.

(Reuters, Financial Times)

Other Macro Developments

Hungary’s centre-right opposition Tisza party has kept its 10-point lead over PM Orban’s Fidesz ahead of April elections - Orban faces a strong challenge for the first time in 16 years.

(Reuters)

GEOPOLITICAL

Trump Administration: Ukraine Must Cede Donbas for Security Guarantees

The Trump administration has signalled that US security guarantees depend on Kyiv agreeing to a peace deal likely requiring it to cede the Donbas to Russia. Washington indicated it could offer more weapons to strengthen Ukraine’s peacetime army if Kyiv withdraws from the eastern region.

Israel is preparing for talks with the Trump administration on a new 10-year security deal, seeking to extend US military support even as Israeli leaders signal they’re planning for reduced American cash grants.

(Financial Times)

Iran Death Toll Could Exceed 10,000

Human rights groups estimate the death toll from Iran’s crackdown on protests could exceed 10,000, far surpassing initial figures. The regime’s response looks deadlier by the day.

(Wall Street Journal)

Japan: Taiwan Conflict Would Collapse US Alliance

PM Takaichi said Japan’s strategic alliance with the US would collapse if Tokyo turned away from a conflict over Taiwan, but distanced herself from previous comments suggesting a possible military response.

(Reuters)

EQUITIES

Micron Building $24 Billion Chip Plant in Singapore

Micron is investing $24 billion in a new NAND chip manufacturing plant in Singapore as it races to boost output amid an acute global memory shortage. Wafer production begins in the second half of 2028. The company’s separate HBM facility under construction in Singapore is on track to contribute to supply in 2027.

(Reuters)

Intel and AMD Considering 15% Server CPU Price Hikes

Intel and AMD are considering raising server CPU prices by up to 15% as demand surges. Lead times have stretched from the typical 8-10 weeks to over 24 weeks, according to industry sources.

(Hankyung via @jukan05)

Salesforce Lands $5.6 Billion Army Contract

The US Army signed a $5.6 billion, 10-year contract with Salesforce, giving the military access to cloud software to modernise antiquated practices.

(Wall Street Journal)

Netflix-Warner Bros Deal Faces Senate Scrutiny

The chairman of the Senate’s antitrust subcommittee is raising concerns over Netflix’s proposed acquisition of Warner Bros studios and HBO Max. A hearing is scheduled for 3 February.

(Wall Street Journal)

EVs Outsell Petrol in EU for First Time

Fully electric car sales overtook petrol for the first time in the EU in December, even as policymakers proposed loosening emissions regulations. Tesla closed the year with lower European sales as BYD continued to outpace Elon Musk’s EV maker.

Ford and GM are in negotiations with bankrupt car parts supplier First Brands over financing to keep the company operating during Chapter 11.

(Wall Street Journal, Reuters, Financial Times)

Anta Becomes Puma’s Biggest Shareholder

Chinese sportswear giant Anta has agreed to acquire a $1.79 billion stake in Puma, making it the largest shareholder in the German sneaker company.

(Wall Street Journal)

Other Equity Moves

Tencent plans to expand its data centre footprint in the Middle East to boost cloud computing outside China. Nike is laying off about 775 workers as it ramps up automation as part of its turnaround strategy.

Roche said a weight-loss drug candidate achieved positive results in a midstage trial, paving the way for late-stage studies this quarter. Sandvik reported better-than-expected Q4 profit as high mining activity and commodity prices drove demand.

(CNBC, Wall Street Journal, Reuters)

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