Trump's Greenland Gambit Roils European Markets

European shares fell on Monday after President Trump reignited trade tensions by threatening new tariffs unless the U.S. was allowed to purchase Greenland. The announcement sent the STOXX 600 index down amid earnings reports and upcoming geopolitical discussions at the World Economic Forum in Davos.

European markets experienced a steep drop on Monday following President Trump's controversial proposal to impose new tariffs unless the United States is permitted to acquire Greenland. This unexpected move has rekindled global trade tensions and cast doubt on previously established agreements.

The pan-European STOXX 600 index decreased by 1.3% as investors braced for a week filled with crucial earnings reports and the influential World Economic Forum in Davos. Notable declines included France's CAC 40, Germany's DAX, and London's FTSE 100, which fell by 1.8%, 1.4%, and 0.4%, respectively.

In response, European officials are strategizing potential countermeasures to deter the U.S. president's tariff threats, which include a proposed 10% tariff on Scandinavian and select European nations' goods starting February 1, escalating to 25% by June 1 if negotiations falter.

(With inputs from agencies.)