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Published : 02 Feb 2026, 11:48 AM
Asian shares followed Wall Street futures deep into the red on Monday as chaotic selling in precious metals made for a nervous start to a week that is packed with corporate earnings, central bank meetings and major economic data.
SilverXAG= lost another 10 percent at one stage, as Friday's 30 percent plunge squeezed leveraged positions in what had become a very crowded trade. Dealers said pressure on the UBS SDIC silver futures fund in China added to the rout, with talk of investors having to sell profitable assets to cover margin calls.
Adding to the unease was a move by the CME to raise margins on a number of futures contracts, including gold and silver.
Oil prices also fell more than 4 percent as President Donald Trump said over the weekend Iran was "seriously talking" with Washington, perhaps lessening the risk of a US military strike on the country.
The jitters saw South Korea's formerly high-flying KOSPI .KS11 shed 5.5 percent, the biggest one-day loss since the tariff-induced market mayhem of last April.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS sank 2.8 percent, while Chinese blue chips lost 1.0 percent, with heavy falls in gold indexes.
Japan's Nikkei fell 1.0 percent, supported only briefly by an opinion poll suggesting Prime Minister Sanae Takaichi's Liberal Democratic Party was likely to score a landslide victory in next week's lower house election.
Such a victory would likely make it easier to push through aggressive stimulus policies, and ease political uncertainty. More debt-funded spending could pressure bonds and the yen, with Takaichi talking up the benefits of a weaker currency for exports.
It was also a busy week for earnings in Europe, with around 30 percent of Euro STOXX market capitalisation due to report. EUROSTOXX 50 futures STXEc1 and DAX futures FDXc1 both fell 1.1 percent, while FTSE futures FFIc1 dipped 0.5 percent.
S&P 500 futures ESc1 lost 1.2 percent and Nasdaq futures NQc1 fell 1.6 percent, with much now riding on earnings to support valuations. About one quarter of the S&P 500 set to report this week, and growth in earnings per share was running at 11 percent on the previous year, when consensus had been for 7 percent.
The focus will be on tech majors Alphabet, Amazon and AMD, particularly costs and benefits of AI in the wake of Microsoft's badly received results.
Analysts at Goldman Sachs noted consensus estimates for AI hyperscaler capex this year had climbed to $561 billion, up 38 percent on 2025 and compared to $540 billion expected at the start of earnings season.
DOLLAR STEADIES AS YEN SLIPS
In currencies, the dollar looked a little steadier as early weakness in the yen saw it edge up 0.1 percent to 155.00 JPY=EBS. Yet, the euro still added 0.2 percent to $1.1868 EUR=EBS, regaining some of Friday's 1 percent retreat.
The dollar rally had been initially triggered by Trump's choice of former Federal Reserve governor Kevin Warsh to become the next chair of the central bank.
Analysts assumed Warsh was less likely to press for all-out rapid rate cuts than some other possible choices, though he has sounded more dovish than current chair Jerome Powell.
"Trump is most unlikely to have nominated Warsh if he was not genuinely supportive of lower interest rates, and for which there is plenty of evidence Warsh believes that the economy can achieve higher rates of non-inflationary growth," said Ray Attrill, head of FX strategy at NAB.
This was why market pricing remained at two rate cuts for this year, with a move seen unlikely until June when, presumably, Warsh will be chair. Futures imply a 68 percent chance of a steady outcome at the April meeting and, oddly, 68 percent for an easing in June.
That outlook may change should the January payrolls report on Friday surprise significantly in either direction, assuming the government is open and it is actually released.
Also on the menu this week are policy meetings by the Reserve Bank of Australia, European Central Bank and Bank of England.
The RBA is an outlier in that markets imply around a 75 percent chance it will raise interest rates by a quarter point to 3.85 percent, so reversing one of three cuts delivered last year, in an attempt to quell resurgent inflation.
In commodity markets, volatility was the main theme as gold fell 4.1 percent to $4,665 an ounce XAU=, having shed almost 10 percent on Friday. Silver was last down 7.0 percent at $78.61 XAG=, with trade extremely choppy.
"We think this is a buying opportunity for both gold and silver as the market eventually resumes their preference for hard assets relative to the US dollar," said Vivek Dhar, a mining and commodities strategist at CBA.
"We still maintain our forecast for gold futures to reach $US6,000/oz in Q4 2026 on stronger structural safe-haven demand and a lower Fed Funds rate."
Oil prices fell as investors waited anxiously to see whether the US would strike Iran, or some sort of deal could be struck.
Brent LCOc1 slid 4.5 percent to $66.30 a barrel, while US crude CLc1 dropped 4.6 percent to $62.19 per barrel.
