U.S. stocks plunged 1.8-2.4% on Tuesday after President Trump threatened 10% tariffs on European goods over Greenland, citing national security.
Market Reaction
On Monday, Americans celebrated Martin Luther King Jr. Day, so it wasn’t until Tuesday that Wall Street investors could react to the threat of a trade conflict between the U.S. and Europe. Major U.S. indexes lost 1.8–2.4% in value, recording their largest single-day losses in three months.
Trump’s Tariff Threat
Over the weekend, Donald Trump threatened that if the United States do not gain control over Greenland, he will impose a 10% tariff on goods imported from several European countries starting February 1. In the future, rates could rise to 25%. The Danish island is considered by the U.S. president to be crucial for U.S. national security.