Dow Jones & Nasdaq 100: US-EU Tariff Risk Weighs on US Futures

• Trump threatened 10% tariffs on Denmark, Finland, Norway, Sweden, France, Germany, the Netherlands, and the UK starting February 1, rising to 25% by June 1, linked to demands for Greenland acquisition.
• The EU could deploy its 'anti-coercion instrument' in retaliation, enabling trade sanctions, export restrictions, and exclusion of US companies from its internal market.
• Dow Jones E-mini fell 427 points and Nasdaq 100 E-mini dropped 267 points in Asian trading, though Dow and S&P 500 futures remain above their 50-day and 200-day EMAs, indicating continued bullish bias.

Market Summary: US Futures Decline on EU-US Tariff Tensions

Key Developments:

US stock futures fell during Asian trading on January 20, 2026, as escalating tariff threats between the US and EU sparked risk aversion. Dow Jones E-mini futures dropped 427 points, Nasdaq 100 E-mini fell 267 points, and S&P 500 E-mini declined 64 points.

Tariff Details:

President Trump announced 10% tariffs on eight NATO members (Denmark, Finland, Norway, Sweden, France, Germany, Netherlands, and UK) on January 17, set to take effect February 1 and escalate to 25% by June 1. The tariffs aim to pressure EU leaders regarding US acquisition of Greenland. Denmark has deployed additional troops to Greenland in response.

EU Response:

The EU threatens to deploy its anti-coercion instrument (ACI), enabling trade sanctions, export restrictions, intellectual property protection removal, and market exclusion for US companies. A full-blown trade war could nullify the 2025 US-EU trade deal.

Technical Outlook:

Despite losses, Dow and S&P 500 futures remain above 50-day and 200-day EMAs, maintaining bullish bias. Nasdaq 100 traded below its 50-day EMA, signaling bearish near-term sentiment.

Key Levels:

• Dow: Resistance at 49,901 (January 13 high); Support at 50-day EMA (48,364)
• Nasdaq: Resistance at 50-day EMA (25,468); Support at 25,000
• S&P 500: Resistance at 7,036; Support at 50-day EMA (6,877)

Market Drivers:

Positive factors include expectations of strong Q4 earnings (Netflix reporting Tuesday), Fed rate cut prospects, and resilient US economic data. ADP employment data due Tuesday will influence Fed rate path expectations. The analyst maintains a cautiously bullish outlook unless trade tensions escalate further.