When the U.S. stock market next opens on Tuesday it will be slightly weaker because of President Donald Trump’s Greenland tariff threats, experts have suggested.
Since assuming office, Trump has stressed that the U.S. needs to acquire Greenland for security reasons, sparking a backlash from Greenland and European leaders who have defended Greenland’s rights as a self-governing territory to determine its own future. The U.S, has not ruled out using military force to take Greenland.
Amid this diplomatic upset, Trump wrote on Truth Social Saturday that the U.S. would implement a 10 percent tariff on goods from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland starting February 1, rising to 25 percent on June 1 where it would remain until a deal on Greenland is reached.
Since Trump made his comments, the U.S. stock market has been closed for the weekend and on Monday for the Martin Luther King Jr. Day, but when it reopens on Tuesday there may be changes based on how the markets received the news.
Speaking to Newsweek, Dan Ives, the global head of tech research, managing director and senior equity analyst at Wedbush Securities said: “The U.S. market will be weaker when it opens up on Tuesday but investors will ultimately view the bark is worse than the bite with Trump’s threats.”
“Nearly 80 million Americans gave President Trump and Republicans in Congress a resounding Election Day mandate to Make America Wealthy Again. The Trump administration is focused on delivering on this mandate with a proven agenda of tax cuts, deregulation, tariffs, and energy abundance,” White House spokesman Kush Desai told Newsweek.
Why It Matters
The potential tariffs threaten to upset the global economy and the value of certain companies, stocks and indexes. This would affects investors and their income and could cause companies to cut jobs and decrease business investment and pass on costs to consumers, leading to higher prices for Americans.
Trump’s imposition of tariffs in April 2025 shocked global markets and caused Trump to pause some of his tariffs for 90 days.
What To Know
According to markets data, on Friday, the S&P 500 fell 0.1 percent while the Dow industrials lost 0.2 percent. Nasdaq Composite Index also lost 0.1 percent.
The US Dollar index, which tracks the value of the currency against others, is down 0.35 percent.
Meanwhile, stock futures have fallen in Europe. Bloomberg reported that European equity-index futures dropped 1.3 percent.
London’s FTSE 100 index fell 0.4 percent, according to multiple reports.
Peter Tchir, head of macro strategy at Academy Securities said: “I expect stocks to open the week a little lower (in the 1 to 3 percent range) with big tech doing the worst, as that is where the EU goods do the most damage if they decide to ratchet up tariffs on their end.”
“Market is probably right to downplay the tariff risk and potential escalation from Europe,” he told Newsweek. “But negotiations this time might be very different, as even deciding to sell land, is a pretty decent sized hurdle.”
As several European leaders have warned that Trump’s tariff threats risk unity within the North Atlantic Treaty Organization (NATO), the European Union (EU) is reportedly considering a $107 billion tariffs package in retaliation to Trump. The report, from the Financial Times, said the bloc may also use an anti-coercion instrument which would limit American companies from accessing the internal European market. This is known as the bloc’s “trade bazooka.”
Ives added: “This is all a game of high stakes poker and the market could be volatile as more negotiations take place this week around Greenland. Investors have learned over the last year to stay calm and opportunistic with Trump tariff threats.”
What People Are Saying
President Donald Trump said on Truth Social Saturday in part: “Starting on February 1st, 2026, all of the above mentioned Countries (Denmark, Norway, Sweden, France, Germany, The United Kingdom, The Netherlands, and Finland), will be charged a 10% Tariff on any and all goods sent to the United States of America. On June 1st, 2026, the Tariff will be increased to 25%. This Tariff will be due and payable until such time as a Deal is reached for the Complete and Total purchase of Greenland.”
Denmark, Finland, France, Germany, the Netherlands, Norway, Sweden and the United Kingdom said in a joint statement published on Sunday: “As members of NATO, we are committed to strengthening Arctic security as a shared trans-Atlantic interest. We will continue to stand united and coordinated in our response.”
U.K. Prime Minister Keir Starmer wrote on X: “Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong. We will of course be pursuing this directly with the US administration.”
European Commission President Ursula von der Leyen wrote on X: “Tariffs would undermine transatlantic relations and risk a dangerous downward spiral. Europe will remain united, coordinated, and committed to upholding its sovereignty.”
What Happens Next
The U.S. stock markets reopen on Tuesday. Trump will meet with European leaders at the World Economic Forum in Davos this week.
Tchir said the market could change as the conflict continues. “I think we will see bond yields, especially at the long end of the yield curve. There will be some concern that if we see escalation, we could see Europe and the U.K. reduce their holdings of treasuries. Also, depending on the purchase price, if we ever get to that point, it would likely require to issue more bonds. So look for higher yields.”