'Trump is a bull in a china store': US indices rise after two days of decline

The three major U.S. stock indices rose more than 1% each at the end of trading on January 21. Investors rejoiced at the statements of Donald Trump, who first said that he does not intend to take Greenland by force now, and then - that he will cancel the announced duties against eight European countries. Market participants actually don't really believe Trump's threats anymore, some analysts said.

- The S&P 500 broad market index rose 1.16% to 6,875.62 points on Wednesday. This is the best growth of the index for the day since November, noted Bloomberg.

- The blue-chip index Dow Jones Industrial Average added 1.21% to 49,077.23.

- "Technology" index Nasdaq Composite rose 1.18% to 23,224.82 points.

- The Russell 2000 index of small-capitalization companies added 2% at once and reached 2698.17 points.

- The VIX Wall Street Fear Index is down 16%, indicating less volatility.

- Spot gold prices fell sharply during the trades - from $4851 to $4761, but then almost recovered the losses and at the time of publication of this material were rising by 1.5%.

- Technology stocks rose in price: for example, quotes securities Nvidia rose by 3%, AMD - immediately by 7.8%.

US President Donald Trump on Wednesday first said he "does not need or want" to use military force to gain control of Denmark's Greenland. And then, after meeting with NATO Secretary General Mark Rutte in Davos, Switzerland, said he had agreed on a "framework for a future deal" on the island and his decision to waive additional duties on goods from eight European countries. The 10% levies were due to take effect on February 1.

"Because of the outrage over the U.S. asserting itself and demanding to buy Greenland from Denmark, Davos has turned into an emergency summit. Trump is a bull in a china store, so it will be interesting to see how European allies react," said Louis Navellier, chairman and chief investment officer of Navellier & Associates, as quoted by Bloomberg.

Wednesday's stock market rise followed the strongest drop in indices since October, which happened on Tuesday. Investors then reverted to a "sell American" trend due to trade war fears. In reality, however, many investors are no longer reacting to Trump, according to Argent Capital Management portfolio manager Jed Ellerbrock.

"President Trump is very unpredictable and changes direction quickly. The stock market is no longer assuming that his official statements will materialize. A battle with Europe over Greenland would have brought the market down much more than 2% yesterday if investors actually believed this was a major geopolitical conflict," Ellerbrock noted in a CNBC story.

"We'll be watching closely for future signals from the president and European partners in the coming days that may provide more clarity on the way to resolve this dispute in a way that responds to U.S. security concerns and protects local sovereignty," said Edward Jones analyst James Maquan (quoted by Bloomberg).

This article was AI-translated and verified by a human editor