Wall Street slips after Trump threatens some NATO members with tariffs on Greenland
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Stocks are falling on Wall Street after US President Donald Trump threatened to impose new tariffs on eight NATO members as tensions rise over his efforts to assert US control over Greenland.
The S&P 500 fell 1.3 percent in early trading Tuesday. The Dow Jones Industrial Average fell 642 points, or 1.3 percent. The Nasdaq Composite fell 1.5 percent.
Trump said on Saturday that he would impose a 10 percent import tax on goods coming from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland starting in February. European markets also fell and Treasury yields rose in the bond market.
Annual combined imports from EU countries exceed that of the top two largest individual importers, the US, Mexico and China.
Before US markets opened, bourses in Paris, Frankfurt and London all fell more than one percent and were on track for a second consecutive day of decline.
Both silver and gold again reached record highs as investors sought safety amid rising geopolitical tensions. Gold was up three per cent at US$4,733 an ounce while silver jumped more than seven per cent at US$95.30.
Trump linked his aggressive stance on Greenland to his decision last year not to award the Nobel Peace Prize, telling Norway’s prime minister in a text message released Monday that he no longer felt “an obligation to think holistically about peace.”
Trump’s message to Jonas Gahr gather There appeared to be a growing standoff between Washington and its closest allies over threats to annex Greenland, the self-ruled territory of Denmark, a NATO member.
Trump’s threat spreads anger across Europe
Trump’s threats have sparked outrage across Europe and sparked a flurry of diplomatic activity as leaders consider possible retaliatory measures, including retaliatory tariffs and the EU’s use of the EU for the first time. anti coercion device.
US Treasury Secretary Scott Besant, speaking on the sidelines of the World Economic Forum’s annual meeting in Davos, Switzerland, said America’s ties with Europe remain strong. He urged trading partners to “take a deep breath” and let tensions stemming from tariff threats on Greenland “die down”.
“Geopolitical events will be in focus today, particularly any talks in Davos,” said Michael Brown, a senior research strategist at Pepperstone, referring to the World Economic Forum.
Wedbush Securities analyst Dan Ives said the new tariff threat “clearly has an impact on the conference,” but it is likely to diminish over time.
“Our view is the bite on this issue and tariff threats will be no worse than last year as negotiations take place and eventually tensions between Trump and EU leaders calm down,” Ives wrote in a note to clients.
This week will bring more US corporate earnings and the latest inflation measurement which has been prioritized by the Federal Reserve for making policy decisions.
The US Federal Reserve’s next policy meeting is in two weeks. It is expected to keep its benchmark interest rate unchanged as it attempts to balance a slowing job market with inflation, which remains above the Fed’s two percent target. The Bank of Japan’s Monetary Policy Board meeting ends at the end of this week.
In Asian trading, Tokyo’s benchmark Nikkei 225 fell 1.1 percent to 52,991.10 after Prime Minister Sanae Takachi called snap elections on Feb. 8.
Yields on long-term Japanese government bonds rose after Takaichi signaled on Monday that he planned to dissolve parliament and call elections in a bid to take advantage of his strong public opinion ratings. He has also proposed temporarily suspending the sales tax on food.
There was a decline in Chinese markets also. Hong Kong’s Hang Seng fell 0.3 percent to 26,487.51, while the Shanghai Composite closed almost unchanged at 4,113.65.
In South Korea, the Kospi fell 0.4 percent to 4,885.75, while Australia’s S&P/ASX 200 fell 0.7 percent to 8,815.90.
Taiwan’s Taiex rose 0.4 percent and India’s Sensex fell 0.8 percent.
US benchmark crude oil rose 52 cents to US$59.86 a barrel. Brent crude, the international benchmark, rose 51 cents to US$64.45 a barrel.
