Stocks rally as Trump drops Greenland tariff threats
Stocks rallied Thursday after President Donald Trump dialled back threats to hit key European countries with tariffs over their opposition to a US takeover of Greenland.Gains were fuelled also by a surge in tech stocks as the artificial intelligence trade roared back into the spotlight after the head of top AI chipmaker Nvidia said the sector needed “trillions of dollars” more investment.Markets had been rattled this week by the US president saying he would hammer several nations — including Germany, France, Britain and Denmark — with levies for their pushback against his grab for Greenland, a Danish autonomous territory.But relief came Wednesday when Trump backed down on threats to seize the North Atlantic island by force from ally Denmark and retracted his tariff threat.”That was enough to trigger the so-called TACO trade — ‘Trump Always Chickens Out’ — and markets responded with one of their strongest rallies in recent months,” said Fawad Razaqzada, market analyst at Forex.com.- Trade wars ‘biggest concern’ -But analysts said there was no guarantee that Europe-US relations had improved durably, a concern that capped gains.”The Greenland situation may have calmed down, but there are still enough unanswered questions,” said AJ Bell investment director Russ Mould. “It’s more about financial markets regaining balance than moving into top gear.”One lesson from this week’s price swings was that “financial markets fear tariffs more than geopolitical risks”, noted Kathleen Brooks, research director at XTB. “Trade wars are the biggest concern for markets.”Advances in Asian equities earlier were led by tech-heavy markets Tokyo, Taipei and Seoul, with the latter topping 5,000 points for the first time as chip companies enjoyed bumper gains.The surge came after Nvidia boss Jensen Huang told the World Economic Forum in Davos that the infrastructure to develop and power generative AI models will require further “trillions” of dollars in investment.He told delegates that the AI boom “has started the largest infrastructure buildout in human history”.The remarks helped boost South Korean chip leaders Samsung and SK hynix, tech investment giant SoftBank in Japan, and European heavyweights ASML and STMicroelectronics.French video game giant Ubisoft lost more than a third of its value in a single session, with its stock closing more than 39 percent lower, after the “Assassin’s Creed” maker announced it expected to make huge losses this year and needed to restructure drastically.- Key figures at around 1640 GMT -New York – Dow: UP 0.9 percent at 49,517.60New York – S&P 500: UP 0.7 percent at 6,924.82New York – NASDAQ: UP 1.0 percent at 23,465.06London – FTSE 100: UP 0.1 percent at 10,150.05 (close)Paris – CAC 40: UP 1.0 percent at 8,148.89 (close)Frankfurt – DAX: UP 1.2 percent at 24,856.47 (close)Tokyo – Nikkei 225: UP 1.7 percent at 53,688.89 (close)Hong Kong – Hang Seng Index: UP 0.2 percent at 26,629.96 (close)Shanghai – Composite: UP 0.1 percent at 4,122.58 (close)Euro/dollar: UP at $1.1748 from $1.1683 on WednesdayPound/dollar: UP at $1.3496 from $1.3418Dollar/yen: DOWN at 158.28 yen from 158.43 yenEuro/pound: DOWN at 87.05 pence from 87.08 penceBrent North Sea Crude: DOWN 1.3 percent at $64.42 per barrelWest Texas Intermediate: DOWN 1.3 percent at $59.82 per barrelburs/jh/rlp





