Wall Street braces for stocks to sink as Trump ramps up tariff threats over Greenland

Market Reaction - Stock futures experienced a significant decline, with Dow futures down over 600 points (1.26%), S&P 500 futures dropping nearly 100 points, and Nasdaq futures falling more than 440 points (1.72%) before the market opened [1][3][4] Tariff Threats - President Trump announced plans to impose new tariffs starting at 10% on imports from several European nations, escalating to 25% by June if they do not agree to cede Greenland to the US [3][4] - The affected countries include Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland, with tariffs set to begin on February 1 [3] Market Volatility - The CBOE Volatility Index surged above 19, indicating a shift from market complacency to heightened anxiety, marking the highest level in approximately two months [4] Safe Haven Investments - Traders are increasingly investing in safe havens such as gold and the Swiss franc due to concerns that the tariff threats could lead to a broader trade war with Europe [5] European Response - European leaders have rejected the notion of selling Greenland, emphasizing its status as an autonomous territory of Denmark, while warning of potential countermeasures against US tariffs [10] National Security Argument - Trump has framed the acquisition of Greenland as essential for US national security, citing its strategic location and resources as vital to countering Russian and Chinese influence in the Arctic [6][12] - Treasury Secretary Scott Bessent supported this view, stating that the strategy aims to prevent future conflicts by leveraging economic power instead of military force [9] Ongoing Negotiations - Trump indicated that diplomatic efforts are ongoing, mentioning a positive conversation with NATO Secretary General Mark Rutte and plans for a meeting with various parties in Switzerland [16]