The British newspaper Financial Times reported that U.S. President Donald Trump’s retreat from his threats to impose tariffs on European countries opposing his plans to acquire Greenland came after a sharp drop in stock prices, demonstrating investors’ ability to influence his decisions, even when he ignores his closest allies.
The newspaper reported on Friday that U.S. stocks lost around a trillion dollars in value last Tuesday, in one of the worst selling days since Trump declared what he called “Liberation Day” in April of last year, when he imposed tariffs on a long list of U.S. trading partners.
Although Trump described these losses as “small amounts,” according to the newspaper, compared to the gains made by the New York Stock Exchange last year since his return to the White House, he decided to cancel the tariffs he had previously threatened to impose on major European countries, including Germany and France.
“The Trump Administration’s Sensitivity to Markets”
A chief market strategist at an investment group managing $214 billion in assets told the Financial Times that “there is certainly a sensitivity within the Trump administration to what happens in the stock market.”
They added that this sensitivity “was clearly evident in the decision to backtrack on the tariffs.”
In the same context, the newspaper quoted a chief market strategist at a company as saying that Trump’s comments on Wall Street’s reaction to his threats to punish Europe for rejecting his demands regarding Greenland show that it “hit him where it hurts.”
The Financial Times explained that Trump’s retreat from his threats to impose tariffs on Europe is the latest example “of the financial markets’ ability to tame Trump,” as they described it.
Trump announced reaching a framework agreement with NATO regarding Greenland.
Trump’s Retreat from His Threats
The British newspaper The Guardian reported that European and American market indices rose yesterday, Thursday, following Trump’s retreat from imposing tariffs on Europe, a policy that analysts, according to the newspaper, describe as “Trump always backs down,” a phenomenon now commonly known by the English acronym “TAKO.”
Trump announced during his speech at the World Economic Forum in Davos, Switzerland, on Wednesday, that he would not use military force to annex Greenland. He later posted on his account on the “Truth Social” platform that he would not impose tariffs on Europe after reaching a “framework agreement” on Greenland with the NATO Secretary General.
The Guardian quoted a markets strategist at an investment company as saying, “From a market perspective, what happened is a typical Trump backtrack, which led to a market recovery as a very real threat of a trade war receded.”
It also quoted a head of macroeconomic research at a bank as saying that Trump’s retreat generated “significant relief after investors feared an escalation scenario.”
However, they pointed out that the U.S. dollar exchange rate remains below its level before Trump’s threats to his European allies.
Gold benefited from Trump’s recent threats, with its price reaching $4,960 per ounce, as demand increased for it as a safe haven during times of economic crisis.
Donald Trump
Donald Trump is a businessman and media personality who served as the 45th President of the United States from 2017 to 2021. His presidency was marked by a populist and unconventional political style, significant tax reforms, and a focus on immigration restriction and “America First” foreign policy.
Air Force One
Air Force One is the official air traffic control call sign for any United States Air Force aircraft carrying the President of the United States. The most recognizable planes are two highly customized Boeing 747-200B series aircraft, which entered service in 1990 and are equipped with advanced communications and security features to function as a mobile command center.
Shannon
Shannon is a town in County Clare, Ireland, best known for its international airport, which was established in the 1940s as a key transatlantic refueling stop. The area’s modern development was largely shaped by the airport and the adjacent Shannon Free Zone, one of the world’s first industrial free trade zones created in 1959.
Ireland
Ireland is an island nation in northwestern Europe, historically shaped by Celtic culture, Christianization, and centuries of English rule, which led to its partition in 1921 into the independent Republic of Ireland and Northern Ireland, part of the United Kingdom. It is renowned for its rich literary tradition, vibrant music, and iconic landscapes, with a history deeply marked by the Great Famine of the mid-19th century and a long struggle for sovereignty.
Joint Base Andrews
Joint Base Andrews is a major United States Air Force facility located in Maryland, serving as the primary airfield for presidential transport, most notably Air Force One. It was established in 2003 through the merger of the former Andrews Air Force Base and Naval Air Facility Washington, with the original Andrews field being activated in 1943.
Maryland
Maryland is a U.S. state on the Atlantic Coast, founded in 1632 as an English colony under a charter granted to Cecil Calvert, the second Lord Baltimore. It was established as a haven for English Roman Catholics and became a pivotal border state during the American Civil War.
Greenland
Greenland is the world’s largest non-continental island, located between the Arctic and Atlantic Oceans. It has a long history of Inuit habitation and was later settled by Norse Vikings in the 10th century before coming under Danish rule, from which it now exercises extensive self-government.
Financial Times
The Financial Times is a leading international daily newspaper founded in London in 1888, originally focused on financial and business news. It is renowned for its distinctive salmon-pink paper and has grown into a global publication covering economics, politics, and current affairs.
New York Stock Exchange
The New York Stock Exchange (NYSE), founded in 1792 with the Buttonwood Agreement, is the world’s largest stock exchange by market capitalization. Located on Wall Street in New York City, it has served as a central hub for public trading and capital formation for over two centuries, symbolizing American finance and global capitalism.
White House
The White House is the official residence and workplace of the President of the United States, located in Washington, D.C. It was designed by James Hoban and its construction was completed in 1800, with President John Adams being the first to reside there. The building has been expanded and renovated over the centuries, including after being burned by British forces in 1814.
Germany
Germany is a country in Central Europe with a complex history, having been a collection of states for centuries before unifying in 1871. It was a central power in both World Wars, was divided into East and West Germany during the Cold War, and reunified in 1990 to become a leading economic and political force in the European Union. Its cultural landscape is marked by numerous historic sites, castles, and contributions to philosophy, music, and science.
France
France is a Western European nation with a rich history that dates back to ancient Gaul, evolving through monarchy, revolution, and empire to become a modern republic. It is globally renowned for its profound cultural influence in art, philosophy, cuisine, and fashion, and is home to iconic landmarks like the Eiffel Tower and the Palace of Versailles.
Wall Street
Wall Street is a historic street and financial district in Lower Manhattan, New York City, which became the epicenter of American finance following the 1792 Buttonwood Agreement that established the New York Stock Exchange. Today, it is synonymous with the U.S. financial markets and houses major exchanges, banks, and financial institutions.
NATO
NATO, the North Atlantic Treaty Organization, is a military alliance established in 1949 by the United States, Canada, and several Western European nations to provide collective security against the Soviet Union during the Cold War. Its foundational principle is Article 5, which states that an attack on one member is an attack on all. Following the Cold War, NATO has expanded eastward and adapted its missions to include crisis management and counter-terrorism operations.
The Guardian
The Guardian is a British daily newspaper founded in 1821 in Manchester, originally known as *The Manchester Guardian*. It moved its main operations to London in the 1960s and is renowned for its progressive editorial stance and international journalism, particularly its investigative reporting and open digital model.
World Economic Forum
The World Economic Forum is an international non-governmental organization founded in 1971 by German engineer Klaus Schwab, originally as the European Management Forum. It is best known for its annual meeting in Davos, Switzerland, which brings together political, business, and cultural leaders to discuss global issues and shape agendas. The organization’s mission is to improve the state of the world by engaging leaders to shape global, regional, and industry agendas.
Davos
Davos is a Swiss Alpine town in the canton of Graubünden, historically known as a health resort and for its development as a winter sports destination. It is now most famous for hosting the annual World Economic Forum meeting, where global political and business leaders gather to discuss major economic and social issues.
Switzerland
Switzerland is a landlocked country in Central Europe known for its long history of neutrality, which was formally established in the 1815 Congress of Vienna. It is a federal republic comprised of 26 cantons and is globally recognized for its political stability, direct democracy, and iconic Alpine landscapes.
Truth Social
Truth Social is a social media platform launched in February 2022 by Trump Media & Technology Group. It was created following the suspension of former U.S. President Donald Trump from other major platforms, positioning itself as a space for free speech and an alternative to what it describes as “Big Tech censorship.”
