[Morning Briefing] No 'Warsh shock'…Major U.S. stock indexes rise in tandem

◆ Even amid jitters over a 'hawkish tilt'…bargain hunting in blue chips

All three major U.S. stock indexes closed higher. On the 2nd (local time), the Dow Jones Industrial Average rose 1.05% to 49,407.66, the S&P 500 gained 0.54% to 6,976.44, and the Nasdaq Composite advanced 0.56% to 23,592.11. As investors continued to gauge the future monetary-policy direction of former Fed governor Kevin Warsh, nominated as the next chair of the U.S. central bank (Fed), bargain-buying interest appeared to flow mainly into blue-chip names. Both the bond and FX markets are reflecting Warsh’s hawkish leanings to some extent, but not aggressively; and given that Warsh also showed dovish tendencies during the first Donald Trump administration, equities likewise appear not to be leaning hard into a broad 'Warsh trade,' instead responding on a stock-by-stock basis.

◆ Trump: "In talks with Iran"…oil prices slide

On the 2nd (local time), New York crude prices tumbled, with March-delivery West Texas Intermediate (WTI) settling at $62.14 a barrel, down 4.7% from the previous session. The move is seen as driven by easing 'Iran risk' after U.S. President Donald Trump—who had suggested the possibility of military intervention against Iran—said he is "seriously talking with the Iranian government." Weather forecasts indicating temperatures will moderate from this week are also expected to weigh on oil demand.

◆ India: 50→18%…Trump’s 'elastic tariffs'

Also on the 2nd (local time), President Trump said the U.S. will cut reciprocal tariffs on India to 18%, underscoring that India has agreed to stop purchasing Russian crude oil, as Washington has demanded. He said, "We agreed to a trade deal that takes effect immediately. We will cut reciprocal tariffs from 25% to 18%." The U.S. had imposed a total 50% tariff on India—25% in country-level reciprocal tariffs plus an additional 25% punitive tariff tied to oil trade with Russia—meaning tariff rates on India’s exports to the U.S. will drop to less than half.

◆ Ruling-party floor leader’s address…seeking opposition cooperation?

Han Byung-do, floor leader of the Democratic Party of Korea, will deliver a parliamentary address today (the 3rd) at the National Assembly plenary session. He is expected to stress what he calls ending the insurrection, prosecutorial reform, judicial reform and improving livelihoods, and to broadly present the legislative agenda—including bills aimed at livelihoods—for the February extraordinary session. In particular, he is expected to seek the People Power Party’s cooperation on key issues, such as passage of a special law on investment in the U.S. and a special bill on administrative integration. President Lee Jae-myung recently publicly criticized at a Cabinet meeting that "the pace of legislation in the National Assembly is too slow."

◆ Cold snap eases from daytime…highs of 3–10°C

Today, Tuesday, will see the cold ease somewhat, with daytime highs rising to 3–10°C, and daytime temperatures are expected to stay around or slightly above seasonal norms for the time being. However, caution is needed as melted snow during the day may refreeze overnight, creating icy roads and black ice in many areas. Fine-dust levels are forecast to be 'Moderate' in the Seoul metropolitan area, Yeongseo in Gangwon, the Chungcheong region, Gwangju, North Jeolla, Daegu-Gyeongbuk, and South Gyeongsang, and 'Good' in Yeongdong in Gangwon, South Jeolla, Busan-Ulsan, and Jeju.

Kim Bong-gu, Hankyung.com reporter kbk9@hankyung.com