Stocks Remain Low for Holiday Closure as Tariff Fears Take Over
Stocks took a tumble on Friday as Trump announced plans to annex Greenland through tariff threats to European nations.
Quick overview
- President Trump announced plans to acquire Greenland, threatening higher tariffs on countries that oppose his intentions.
- The stock market experienced slight declines ahead of the holiday, with the Dow, Nasdaq, and S&P 500 all down.
- Investors are concerned about potential market volatility due to Trump's tariff threats, particularly affecting riskier assets.
- Key stocks like Nvidia and Walmart showed mixed performance, with Nvidia down slightly and Walmart gaining before the market closed.
President Donald Trump announced plans to acquire Greenland and issued a threat of higher tariffs to countries that do not support his plans.
The stock market trended slightly down on Friday as trading exchanges closed for the Monday holiday. The Dow fell 0.17%, and the Nasdaq dropped 0.6%. The S&P 500 was down 0.6% as well, and investors are worried what Trump’s new tariff threat will mean for the market.
Trump has made his plans clear for adding Greenland to U.S. possessions, but the land is owned by the Dutch government. Greenland is considered an important piece of real estate for military defense, as it is strategically placed to provide a base of operations for defensive and offensive strategies against China, Russia, and other Northern Hemisphere powers.
Global Stocks Slip as Market Volatility Increases
Investors may be hesitant to build their portfolios on potentially risky assets right now as the market could shift dramatically in the coming weeks. The stalwarts that remain reliable from month to month may continue to perform well enough, but some of the riskier, more unstable stocks are likely to see many of their investors pull away as Trump begins what looks to be another trade war.
Stocks slipped only slightly on Friday, but investors are preparing for further decline on Tuesday when the market reopens. The stock exchanges will be closed all through Monday for the Martin Luther King Jr. holiday. When they open back up, they may be facing the impact of a new trade war between the United States and Denmark, Finland, Norway, Germany, Sweden, France, the Netherlands, and the United Kingdom. Trump already announced that he would be instituting the new tariffs from February 1st, which would increase levies to 10% and then an additional 25% on June 1st.
What we have seen in the past is that countries tend to respond quickly to Trump and work out an agreement that leads to lower tariffs than those promised but that at the same time Trump gets at least some of his requests met. Until some kind of agreement is reached, however, the stock market may be in a state of turmoil and mostly trend downward.
Nvidia (NVDA) is one of the key stocks to watch at the moment, since it has the largest market capitalization and serves as an indicator for the quickly growing and highly lucrative AI market. NVDA stock fell 0.44% on Friday but remains elevated after a spike on Thursday.
Walmart (WMT) gained 0.42% on Friday before the market closed. This is another indicative stock that tends to do well when the market dips. This reliable stock can perform admirably even during an economic recession and may be one of the better choices for investors looking to weather the coming storm of market instability.
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