After President Donald Trump’s weekend announcement threatening a 10% tariff on imports from eight European countries amid his push to acquire Greenland, global markets reacted sharply. On Tuesday, the Dow Jones Industrial Average dropped over 700 points (about 1.5%), while the S&P 500 and Nasdaq each fell more than 1.7%, wiping out early-year gains. European benchmarks like the Stoxx 600 slid around 1%, continuing a declining trend that began Monday.
In fixed income, US Treasury yields surged, with the 10-year note reaching 4.28% and the 30-year nearing 4.9%, the highest since September. The US Dollar Index dropped nearly 1%, marking its worst day since last April, signaling widespread foreign investor selloff amid elevated geopolitical risk.
Investors flocked to safe havens: gold futures surged 3.5% to record highs above $4,750 an ounce, while silver gained 6.3%, briefly surpassing $95 per ounce. This flight to safety highlights growing uncertainty over US trade policy and its impact on the transatlantic relationship.
Watch for potential further volatility as the US Supreme Court considers the legality of Trump’s tariffs and as European Union leaders debate retaliatory tariffs. The next moves will signal how durable this shock is for global markets.
