Wall Street Woes: Fresh Tariff Threats Shake Markets

Wall Street indexes fell to near three-week lows due to U.S. tariff threats against Europe over the Greenland dispute. As investors returned from a market holiday, they faced a risk-off wave, with gold hitting record highs, global stocks falling, and U.S. Treasuries under pressure.

Wall Street's main indexes suffered a sharp decline, hitting a near three-week low on Tuesday. This slide was precipitated by new tariff threats from President Donald Trump aimed at Europe, spurred by a dispute over the control of Greenland. Investors returning from a market holiday encountered an already active risk-off wave, resulting in global stock declines and U.S. Treasuries feeling the pressure.

In a recent move, Trump declared additional 10% import tariffs effective February 1 on several European nations, escalating to 25% by June 1 unless Greenland's purchase deal is struck. Denmark and Greenland have rebuffed these overtures, insisting the island is not for sale. Market strategist David Lundgren noted this uncertainty is fuelling investors' anxiety and shifting focus from larger U.S. firms to smaller international markets.

On the economic front, Wall Street enters a packed schedule of data releases and corporate earnings, including the third-quarter U.S. GDP update and critical earnings reports from industry giants like Intel and Netflix. With volatile conditions and strategic movements in key sectors, the market remains watchful of ongoing tariff discussions and global economic dialogues at international forums, including Davos.

(With inputs from agencies.)