‘Going to double’: Stock markets soar after Trump’s Greenland backflip

Share markets rallied this morning after Donald Trump announced he was cancelling planned tariffs on the EU over Greenland and said he “won’t use force” to take the Danish island territory. The Dow Jones Industrial Average was up around 600 points, or 1.2 per cent, in afternoon trading on Wall Street, while the S&P 500 and Nasdaq Composite were also up about 1.2 per cent. Gold topped out at $US4888 an ounce in early trading on Wednesday, but silver traded below $US94 after touching $US95 a day before. The safe-haven precious metals fell sharply after Mr Trump’s tariff backflip. Greenland tensions saw markets crater on Tuesday, with US stocks, bonds and the dollar all lower in a broadbased sell-off that drew comparisons to the brutal reaction to Mr Trump’s announcement of sweeping global tariffs early last year. The US President, speaking at the World Economic Forum (WEF) in Davos, Switzerland, nodded to the stock dip, suggesting the Dow could soon hit 50,000, points, from around 49,100 points, and then “double”. “Our stock market took the first dip yesterday because of Iceland,” Mr Trump said, apparently mixing up Iceland (which is green) and Greenland (which is icy). “So Iceland’s already cost us a lot of money. But that dip is peanuts compared to what it’s gone up. And we have an unbelievable future in that stock market. That stock market is going to be doubled. We’re going to hit 50,000 and that stock market’s going to double in a relatively short period of time.” President Donald Trump in Davos, Switzerland. Picture: Evan Vucci/AP It came after Mr Trump announced had had a “framework of a future deal with respect to Greenland” and would not impose tariffs on Europe like he threatened to do. Markets have tumbled this week after Mr Trump threatened tariffs up to 25 per cent on several European countries — including France, Germany, Britain and Denmark — in response to their opposition to his plans to take Greenland. But “investors found some relief after President Donald Trump’s speech at Davos was less confrontational than anticipated,” Patrick Munnelly, strategist at Tickmill Group, told AFP. “Trump assured that no military action would be taken in the Greenland dispute, calming market nerves.” In Europe, London and Paris closed marginally higher, while Frankfurt fell. Mr Trump’s threats have sparked warnings of retaliation at the World Economic Forum meeting in Davos, with European Union chief Ursula von der Leyen saying that the 27-nation bloc would be “unflinching” in its response. In his Davos speech, Mr Trump touted the strength of the US economy and stressed what he said are the security imperatives for having control of Greenland. In Asian trading earlier Wednesday, Tokyo’s stock market fell, while Hong Kong and Shanghai rose. The US dollar steadied after several downward sessions provoked by Mr Trump’s tariff threats. Greenland was a major topic at the annual meeting of political and business leaders. Picture: Chip Somodevilla/Getty Images “The fear narrative ran ahead of reality,” said Stephen Innes, managing partner at SPI Asset Management. “The idea of Europe dumping US assets en masse makes for a dramatic storyline, but it collapses under practical constraints. There are not enough deep alternative pools to absorb that kind of flow without severe dislocation.” Mr Trump announced on Wednesday that “we have formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region”. “This solution, if consummated, will be a great one for the United States of America, and all NATO Nations. Based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st,” he wrote on Truth Social after his meeting with NATO Secretary General Mark Rutte. It was a major breakthrough on the most contentious issue facing Trump and Europe. No immediate details on the framework were available. Mr Trump has been vocal in his desire to own the island in the North Atlantic and Denmark has been just as vocal about keeping it in their possession. As European leaders pushed back on Trump’s desire to own Greenland, the President got tough. Earlier this week he threatened a 10 per cent tariff “on any and all goods” sent from the UK, Denmark, Norway, Sweden, France, Germany, the Netherlands and Finland to the US. He said it would begin February 1 and increase to 25 per cent on June 1. People walk on a snow-covered shopping street in the city centre in Nuuk, Greenland. Picture: Sean Gallup/Getty Images But now he’s rescinded that plan, saying Vice President JD Vance, Secretary of State Marco Rubio, and Special Envoy Steve Witkoff will lead discussions on Greenland. Greenland was the main topic of the President’s speech to the World Economic Forum on Wednesday, where he ruled out using military force to take the island. “I don’t have to use force,” he said. “I don’t want to use force. I won’t use force.” He...

‘Going to double’: Stock markets soar after Trump’s Greenland backflip

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