European shares dropped and U.S. stock futures sank after Trump threatened a 10% tariff on imports from eight European countries due to their opposition to U.S. control of Greenland. Germany’s DAX fell 1.3%, and U.S. stock futures were down 1%. The move sparked backlash from European allies, risking transatlantic relations.

In Asia, China’s economy expanded at a 5% annual pace in 2025, despite slowing in the last quarter. Hong Kong’s Hang Seng index fell 1.1%, while Japan’s Nikkei 225 declined 0.7%. South Korea’s Kospi rose 1.3%, and Taiwan’s Taiex added 0.7%.

U.S. stocks edged lower on Friday, with the S&P 500, Dow industrials, and Nasdaq composite all seeing losses. Technology stocks were strong throughout the day. Earnings updates will offer insight into consumer spending and business performance amidst inflation and tariffs.

This week brings a mix of earnings from airlines, industrial, and technology companies, including United Airlines, 3M, and Intel. The Fed will monitor inflation with the release of the PCE price index. Oil prices stabilized after protests in Iran, while gold and silver prices rose.

The U.S. dollar rose against the Japanese yen and euro. Trump’s tariff threats are testing alliances and affecting global markets, with Europe reacting strongly. The Fed faces a balancing act between a slowing job market and high inflation at its upcoming policy meeting.

Read more at Yahoo Finance: US futures sink after Trump warns of higher tariffs for 8 countries over Greenland issue