Financial markets, including the banking sector, faced renewed pressure as geopolitical tensions resurfaced. Shares of major international banks like Standard Chartered and HSBC retreated from recent highs amid uncertainty sparked by former U.S. President Donald Trump's threats to impose new tariffs on European nations unless the U.S. gains access to Greenland.
Standard Chartered's stock fell roughly 0.7% to 1,865 pence in early London trading, easing from a 52-week peak. The bank's ongoing share buyback program, which saw it repurchase 535,597 shares for about $1.21 billion on January 16, provided only a temporary cushion against the broader market jitters. Analysts noted the buyback helped prevent a sharper decline, but geopolitical concerns remained dominant.
Economists at ING described the tariff threats as "more political than economic," highlighting risks of policy-driven market disruption. The uncertainty caused European equities to slip and prompted analysts from ANZ and Rabobank to caution about potential U.S. dollar weakness, questioning its safe-haven status. Deutsche Bank strategist George Saravelos warned that prolonged standoffs could escalate into a "weaponisation of capital," disrupting global trade and investment flows, a scenario particularly sensitive for banks with significant international exposure like Standard Chartered.
Meanwhile, HSBC shares also edged lower, closing at 1,238.8 pence despite bullish internal commentary about reaching a £300 billion market valuation. Investor caution is focused on upcoming corporate events, including a Hong Kong High Court hearing on January 23 regarding the privatization and potential delisting of Hang Seng Bank, a £13.6 billion acquisition. The next key catalyst for both banks will be their annual results; Standard Chartered reports on February 24, and HSBC follows on February 25. Investors will scrutinize these for guidance on credit trends, restructuring progress, and shareholder return plans.
