Wall Street ends higher on Greenland framework deal
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Traders working on the floor of the New York Stock Exchange, in New York City, on Jan 21.
PHOTO: REUTERS
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- Wall Street closed higher after a Greenland deal framework averted new US tariffs on European allies, announced by Donald Trump on Truth Social.
- Positive sentiment was boosted by strong bank earnings and United Airlines' upbeat outlook, lifting regional bank indexes and other airline stocks.
- The Dow rose 1.21%, the S&P 500 gained 1.16%, and the Nasdaq increased 1.18% following Trump's announcement, reversing earlier momentum dips.
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NEW YORK - All three Wall Street benchmarks closed higher on Jan 21, buoyed by the news that a framework for an agreement on Greenland had been reached, averting the possibility of new US tariffs on European allies.
“We have formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region,” US President Donald Trump wrote on his Truth Social platform. “Based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st.”
Wall Street benchmarks had been trading in positive territory at the time of the announcement, but soared in its wake as investors cheered the aversion of a potential new tariff war over the future of Greenland.
“I don’t think who owns Greenland has any immediate impact on anything, in terms of economics,” said Mr Jason Pride, chief of investment strategy and research at Glenmede.
“What the economic impact is whether we all start imposing tariffs on each other,” he added.
According to preliminary data, the Dow Jones Industrial Average rose 588.64 points, or 1.21 per cent, to 49,077.23, the S&P 500 gained 78.76 points, or 1.16 per cent, to 6,875.63 and the Nasdaq Composite gained 270.50 points, or 1.18 per cent, to 23,224.83.
Momentum swings
Before the mid-afternoon Greenland announcement, Wall Street had been broadly positive, as investors responded to the steepest selloff in three months on Jan 20 to regain some ground.
However, while initial momentum had propelled benchmarks more than 1 per cent higher, this momentum had been ebbing by early afternoon.
While light on details, Mr Trump’s announcement allowed markets to focus on underlying strengths within the US economy, including strong earnings from banks.
The latest wave of results from lenders, including some of the largest superregional names, helped send the regional banking index soaring. Gainers among the S&P 500 sub-sectors were led by energy . It was buoyed by Halliburton, which gained after earnings beat estimates, while EQT Corp and Expand Energy advanced as natural gas prices hit a six-week high on cold weather.
Meanwhile, United Airlines rose after the carrier issued an upbeat outlook for the current quarter and the full year. Other airlines benefited from the positive sentiment, with Delta Air Lines, American Airlines and Southwest all gaining. REUTERS
