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Stocks rebound as Greenland agreement calms markets

Equity markets recovered on Wednesday after US President Donald Trump used his appearance at the World Economic Forum in Davos to pull back threatened tariffs on several European countries, citing progress towards a framework agreement on Greenland and the broader Arctic region. US stocks reversed earlier losses, led by technology shares, while Asian markets were trading higher on Thursday, with South Korea’s Kospi briefly hitting a new record. In Europe, equities stabilised. Investors are now turning their attention to US gross domestic product data later on Thursday, as well as quarterly results from major US corporates such as Intel and Procter & Gamble.

  • Data
  • Autore Shane Strowmatt, Senior Investment Writer
  • Tempo di lettura 5 minuto

Volatility
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Equities recovered on Wednesday after US President Donald Trump indicated at the World Economic Forum in Davos that threatened tariffs on eight European countries, including Germany, would not take effect on 1 February, citing progress towards a framework on Greenland and the wider Arctic region. He later said that he and Nato Secretary General Mark Rutte had agreed a basic framework for a future agreement on Greenland, centred on cooperation over a proposed Golden Dome missile defence system and access to Greenland’s mineral resources. Gold retreated as market sentiment calmed, dropping to around USD 4820 per ounce on Wednesday after briefly touching a fresh record above USD 4880 earlier in the week. The US Dollar index stabilised after losses earlier in the week and US Treasuries were little changed, with the 2-year yield hovering around 3.6% and the 10-year yield near 4.3%.

US stocks rebound on Greenland hopes

In the US, the general agreement on Greenland supported stocks. The Dow Jones Industrial rose 1.2% to 49,077.23 points, the Nasdaq 100 gained 1.4% to 25,326.58 and the broader S&P 500 advanced 1.2% to 6875.62, reversing sharp losses from the previous day. At company level, semiconductor stocks outperformed, with Nvidia shares climbing 2.9% and Intel jumping 11.7%, while Netflix fell 2.2% after disappointing quarterly figures.

Asian stocks follow Wall Street

Asian equities advanced on Thursday following the rebound on Wall Street, with South Korea’s Kospi briefly climbing more than 2% to a record over 5000 points but later retreating to trade with a gain of around 0.8%. Tech shares supported regional gains after Nvidia chief executive Jensen Huang highlighted strong long-term demand for artificial intelligence infrastructure, lifting chipmakers such as Samsung Electronics, SK Hynix and Japan’s SoftBank Group, while Hyundai Motor also hit a new high. Japan’s Nikkei 225 was trading 2% higher, while Australia’s S&P/ASX 200 was 0.8% higher. Hong Kong’s Hang Seng Index was essentially flat, slipping 0.1%, and mainland China’s CSI 300 was trading little changed.

Japan export growth slows, Korea's GDP growth cools

In macroeconomics, Japan’s exports increased 5.1% year-on-year in December, below market expectations and down from 6.1% in November, as shipments to the US fell 11.1%. Exports to mainland China grew 5.6%, sales to Hong Kong jumped 31.1% and exports to the wider Asia region rose 10.2%. For 2025 as a whole, exports rose 3.1%, compared with 6.2% in 2024, as weaker demand from the US and China was partly offset by robust growth in shipments to Hong Kong and Taiwan, with additional support from AI-related electronics demand, front-loaded US orders ahead of tariff hikes and a weaker yen.

South Korea growth cools at year-end

South Korea’s economy expanded 1.5% year-on-year in the fourth quarter, slowing from 1.8% in the previous quarter and undershooting market expectations, while gross domestic product contracted 0.3% quarter-on-quarter in the sharpest decline since the end of 2022. For 2025 as a whole, growth slowed to 1%, the weakest since 2020, even though full-year exports reached a record USD 709.7 billion on the back of strong semiconductor shipments, while low inflation near the central bank’s 2% target allowed the Bank of Korea to keep its key rate at 2.5% amid currency pressures.

European stocks stabilise after Trump speech

European equities steadied on Wednesday after US President Donald Trump used his speech at the World Economic Forum in Davos to rule out the use of force over Greenland, easing fears of a further escalation despite his continued insistence that the US should take control of the Danish territory. The euro area blue-chip index EuroStoxx 50 trimmed earlier losses to close 0.4% lower, while the Swiss SMI slipped 0.1%.

UK inflation edges higher in December

UK consumer price inflation increased to 3.4% in December from 3.2% in November, coming in slightly above the market's expectations, while core inflation remained unchanged at 3.2%. The Office for National Statistics said on Wednesday that the acceleration was driven mainly by higher tobacco prices following recent excise duty increases, as well as more expensive airfares and rising food costs, particularly for bread and cereals. The latest figures, following softer labour market data earlier this week, have prompted some market participants to question whether the Bank of England will proceed with an interest rate cut at its next meeting or delay easing, even though rate reductions later this year may be possible if wage and price pressures continue to moderate.

Corporate and economic calendar

Corporate news in focus: Quarterly figures from Abbott Laboratories, Freeport McMoran, Intel, Intuitive Surgical, and Procter & Gamble.

Economic data in focus: US gross domestic product (14:30) and US weekly initial jobless claims (14:30).

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.

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