After a brief sell-off in the run-up to Donald Trump’s speech to global leaders at the World Economic Forum in Davos, Switzerland on Wednesday, markets are up, after the president backed off earlier claims and ruled out using force to acquire Greenland.
The Dow Jones Industrial Average was up 451 points, or about 1%, and the S&P 500 was up 67 points, also about 1%, in midday trading at the time of this writing. The Nasdaq was up about 0.7%.
On the issue of acquiring Greenland, Trump said the following: “We never asked for anything, and we never got anything . . . We probably won’t get anything unless I decide to use excessive strength and force, where we would be, frankly, unstoppable.”
“But I won’t do that. Okay?” Trump continued. “Now everyone’s saying, ‘Oh, good.’ That’s probably the biggest statement I made, because people thought I would use force. I don’t have to use force. I don’t want to use force. I won’t use force.”
Trump has threatened to impose anywhere from 10% to 25% tariffs on our longtime European allies (the U.K., Denmark, Norway, Sweden, France, Germany, the Netherlands, and Finland) over their opposition to his push for Greenland, which had previously triggered a sell-off of U.S. assets, Axios reported.
European nations own an estimated $8 trillion of U.S. bonds and equities.
The 10-year Treasury price turned higher and its yield turned lower following Trump’s comments. The U.S. dollar index pared its decline with other currencies.
Although Trump backed off claims of U.S. military action in Greenland, he did double down on his plans to acquire Greenland, saying he was “seeking immediate negotiations” to discuss the matter.
