Global markets are bracing for volatility this week as President Donald Trump’s sweeping new tariffs take effect, sparking fears of a trade war with Mexico, Canada, and China.
The tariffs have already triggered retaliation threats and could drive up consumer prices while complicating the Federal Reserve’s rate-cut plans.
At the same time, a wave of corporate earnings reports will provide fresh insight into the health of major industries.
Meanwhile, MicroStrategy’s earnings will be a key test for the crypto market, which suffered its largest liquidation event of the year on Feb. 3.
With Bitcoin trading below $100,000 and market observers weighing the economic fallout of Trump’s trade policies, this week’s developments could set the tone for markets in the months ahead.
The global economy is on edge after President Donald Trump announced sweeping new tariffs, escalating tensions with key trading partners. The move imposes a 25% tariff on imports from Mexico and Canada and a 10% levy on goods from China, excluding Canadian energy imports.
The tariffs, which take effect this week, could generate up to $250 billion annually—equivalent to 0.9% of U.S. GDP—but the real impact will likely be higher consumer prices and trade disruptions.
Canada has already signaled retaliation, with Mexico expected to follow. China, meanwhile, is weighing taking the dispute to the World Trade Organization. Trump has also hinted at potential tariffs on the European Union.
“Unless negotiated away, the U.S. tariffs on imports from Mexico, Canada, and China could raise U.S. consumer prices by about 0.6% by year-end,” analysts at Berenberg said in a note.
The move puts Trump on a collision course with the Federal Reserve, which may hesitate to cut interest rates amid rising inflation.
While the tariffs on China are lower than the 60% Trump initially proposed, Mexico and Canada may see reductions if they comply with U.S. demands on migration and fentanyl.
The crypto market responded swiftly, suffering its largest liquidation event of 2025, wiping out $400 billion in market value as investors reassessed risk.
This week also brings a heavy slate of corporate earnings , with investors looking for insight into trade risks, AI investments, and post-holiday consumer demand.
Palantir is expected to release its report later today. With AI-driven enterprise adoption in focus, the company is coming off a strong Q3, where it posted $725.5 million in revenue.
Alphabet Inc. (Google) and AMD are set to release their earnings on Feb. 4.
On Thursday, Feb. 6, Amazon is expected to report strong AWS growth and increased AI spending. In Q3, it posted $158.9 billion in revenue, exceeding forecasts.
Other major reports include AstraZeneca (Feb. 6), Pfizer, Uber, and PepsiCo. Novo Nordisk will also release its full-year results, with investors watching sales of its weight-loss drug after a mixed Q3.
Amid Bitcoin’s recent plunge below $100,000, all eyes will be on MicroStrategy’s earnings report on Feb. 6. The company is expected to post revenue of $124.5 million, flat year-over-year, with a projected net loss of $20.5 million versus a $102.5 million profit in Q4 2023.
Despite its $93 billion market cap, traditional valuation metrics seem irrelevant, with its price-to-sales ratio nearing 200x. Instead, MicroStrategy’s stock performance remains closely tied to its Bitcoin holdings, which have fueled a 730% surge over the past year.
The company’s 20-day rolling correlation with Bitcoin has ranged from -0.28 to +0.94, reflecting both macroeconomic factors and capital-raising strategies. In January, MicroStrategy announced a plan to raise up to $2 billion as part of its broader “21/21 plan,” targeting $42 billion in capital by 2027 to acquire more Bitcoin.
Despite the expected quarterly loss, analysts remain bullish. A full 78% rate MicroStrategy as a “buy,” while 22% label it a “strong buy.” The median price target sits at $510, with a high of $650.
With Bitcoin hovering around $94,000 , MicroStrategy’s earnings could determine whether the crypto sector finds renewed strength or extends its decline.