Asian Markets Gain as Bitcoin Surges on US Strategic Reserve Inclusion

Asian markets saw cautious gains on Monday as investors awaited developments on US tariff policies, while Bitcoin surged following news of its inclusion in a proposed US strategic reserve of cryptocurrencies.

Bitcoin Leads Crypto Rally

Bitcoin, the world’s largest cryptocurrency, jumped 10% to $92,905, following a social media announcement from US President Donald Trump that Bitcoin, Ether, XRP, Solana, and Cardano would be part of a new digital asset reserve. Ether, the second-largest cryptocurrency, pulled back to $2,443 after gaining 13% over the weekend.

The news fueled optimism in crypto markets, with analysts predicting increased institutional interest in digital assets as part of the US government’s evolving financial strategy.

Stock Markets Show Modest Gains

Asian equities responded positively to the developments. MSCI’s broadest index of Asia-Pacific shares (excluding Japan) edged up 0.3%, while Japan’s Nikkei gained 1%. Chinese blue-chip stocks added 0.8%, supported by a rise in manufacturing activity, with February’s PMI improving to 50.8 from 50.1.

US S&P 500 and Nasdaq futures were flat after staging a late recovery on Friday following a volatile trading week. Meanwhile, FTSE and DAX futures climbed 0.6%, signaling optimism in European markets.

Tariff Uncertainty Weighs on Investors

Despite market gains, concerns lingered over US tariff policies. US Commerce Secretary Howard Lutnick confirmed that tariffs on Canada and Mexico would take effect on Tuesday, but President Trump was still considering whether to proceed with the planned 25% rate.

Additionally, a 10% tariff on Chinese imports is set to be implemented this week, coinciding with China’s National People’s Congress, where potential stimulus measures and retaliatory actions may be announced.

“As with other Trump tariff announcements so far, it’s hard to know if this is a bluff or a genuine turn in policy,” said JPMorgan economist Michael Feroli. “If enacted, it would create a significant new headwind for economic growth and increase inflationary pressures.”

Recession Fears Grow Ahead of Jobs Data

Worries over US economic health intensified after a series of weak economic reports. The Atlanta Fed’s GDPNow tracker swung from a +2.3% annualized growth estimate to -1.5%, raising concerns of a potential recession.

Investors are closely watching Friday’s US payrolls report, which could influence expectations for Federal Reserve rate cuts. Fed fund futures now indicate a 69-basis-point rate cut by December, up from 46 basis points a week ago.

Federal Reserve Chair Jerome Powell is scheduled to speak on the economic outlook on Friday, following the jobs data release.

Global Market Trends

• European Central Bank (ECB) is expected to cut interest rates by 25 basis points to 2.50% on Thursday due to continued weak economic data.
• Gold prices rose 0.5% to $2,873 per ounce after declining 3% last week.
• Oil prices rebounded as speculation about US easing sanctions on Russian output created market volatility.
  • Brent crude futures climbed 76 cents to $73.57 per barrel.
  • US crude futures added 74 cents to $70.50 per barrel.
• The US dollar eased slightly, with the euro rising 0.5% to $1.0421 amid hopes for progress in Russia-Ukraine peace talks.

As the week progresses, tariff decisions, US economic data, and global monetary policy signals will shape investor sentiment in both equity and crypto markets.