Asian markets opened the first full trading week of the year on a stronger footing, even as investors grappled with the geopolitical and market implications of a dramatic US military operation in Venezuela.
The capture of Venezuelan President Nicolas Maduro over the weekend injected fresh uncertainty into global markets, influencing moves across equities, commodities, cryptocurrencies, and currencies, while also prompting sharp political reactions from allies and further pointed remarks from President Donald Trump.
Asian markets and oil react to Venezuela developments
Asian equities advanced broadly on Monday, with investors weighing geopolitical risks against optimism ahead of a heavy slate of economic data.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.36%, while S&P 500 e-mini futures edged up 0.13%.
Japan’s Nikkei 225 jumped 3%, nearing a record high reached two months ago, after data showed manufacturing activity stabilised in December following five months of contraction.
South Korea’s Kospi and Taiwan’s benchmark index both climbed more than 2.7% to fresh record highs.
Elsewhere, Australia’s benchmark index added 0.1%.
China-linked markets lagged.
Hong Kong’s Hang Seng Index fell 0.01%, dragged lower by energy stocks after a gauge of Hong Kong-listed oil and gas companies fell 3.1%.
Oil prices were choppy as markets assessed the impact of the US intervention in Venezuela and an OPEC+ decision to keep output unchanged.
Brent crude futures fell 0.3% to $60.55 a barrel.
Neil Shearing, group chief economist at Capital Economics, said the removal of Maduro was “unlikely to have meaningful near-term economic consequences for the global economy,” though he warned that “its political and geopolitical ramifications will reverberate.”
Marko Papic, chief strategist at BCA Research, said Venezuela would need significant capital and engineering support to restore output.
“We are therefore not sellers of oil in this situation and, in fact, think that upside risks could develop,” he said.
Bitcoin and safe havens gain on political uncertainty
Bitcoin rose to a three-week high in early Asian trading as political uncertainty boosted demand for alternative and haven assets.
The largest cryptocurrency climbed as much as 2.3% to $93,323, its highest level since Dec. 11, before easing back to around $91,453 later in the session. Ether was little changed at $3,141.
The move came alongside gains in precious metals.
Gold rose about 1.8% to $4,411.50 an ounce, after earlier jumping above $4,400, while silver surged as much as 3.92% as investors sought safety.
Bitcoin’s recent gains follow weeks of range-bound trading and come despite the cryptocurrency ending last year down 6.5%.
Sean McNulty, APAC derivatives trading lead at FalconX, said the rally was being driven by crypto-native firms and a lack of selling by miners, family offices, and large funds.
On Jan. 2, investors put $471 million into US-listed Bitcoin exchange-traded funds, the largest daily inflow since Nov. 11.
Denmark pushes back on Trump’s Greenland rhetoric
Geopolitical tensions extended beyond Latin America. Danish Prime Minister Mette Frederiksen warned President Trump to stop threatening to acquire Greenland, just a day after the US operation in Venezuela.
“The Kingdom of Denmark — and thus Greenland — is part of NATO and is therefore covered by the alliance’s security guarantee,” Frederiksen said, adding that she would “strongly urge the United States to stop the threats against a historically close ally.”
Her remarks followed comments by Trump, quoted by The Atlantic, saying, “We do need Greenland, absolutely.”
Trump has long floated the idea of acquiring the mineral-rich territory, an ambition that has been repeatedly rejected by both Greenland and Denmark.
Trump targets Colombia and signals wider drug crackdown
A day after Maduro’s capture, Trump signaled that other countries could face pressure over drug trafficking.
Speaking aboard Air Force One, he singled out Colombia and its president, Gustavo Petro.
“Colombia is very sick, too, run by a sick man who likes making cocaine and selling it to the United States, and he’s not going to be doing it very long,” Trump said.
Trump said his campaign against Venezuela would also weaken Cuba, noting that Cuban soldiers assist Venezuela’s military.
“Cuba looks like it is ready to fall,” he said, without offering evidence.
He struck a slightly more conciliatory tone toward Mexico, while repeating complaints about drug flows and noting that Mexican President Claudia Sheinbaum has rejected his offer of US military assistance.
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