Topline
U.S. stock futures fell sharply early on Tuesday, signaling investor concerns about President Donald Trump’s tariff threats against European allies amid his push to take control of Greenland.
U.S. President Donald Trump tours the Ford River Rouge Complex on January 13, 2026 in Dearborn, Michigan.
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Key Facts
In early trading Tuesday, the benchmark S&P 500 Futures Index sunk 1.73% to 6,856 points, while Dow Futures fell 1.61% to 48,751 points.
The tech-centric Nasdaq futures index was the worst hit, diving more than 2% to 25,157 points.
European markets were also hit, with the pan-European STOXX Europe 50 falling 1.32% amid Trump’s threats to impose fresh tariffs on countries opposing his bid to take over Greenland.
The London Stock Exchange’s benchmark FTSE 100 index sunk 1.32% while Germany’s DAX and France’s CAC 40 fell 1.37% and 1.20% respectively.
What Do We Know About Trump’s Tariff Threat Against Europe?
On Saturday, Trump announced he will impose a 10% tariff on eight European countries that recently deployed military personnel in Greenland following his threat to take over the Danish territory. In a post announcing the decision on Truth Social, Trump said Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland will be impacted and the tariff will go into effect on Feb. 1. The sweeping levy covers all exports and will increase to 25% in June and remain in effect until the U.S. takes control of Greenland.
What About Other Tariff Threats Against European Countries?
French President Emmanuel Macron has publicly criticized Trump’s tariffs against Europe over Greenland as “unacceptable” and has even reportedly refused to join his proposed “Board of Peace” for Gaza. When asked about this on Monday night, Trump told reporters: “Well, nobody wants him because he’s going to be out of office very soon.” Trump then claimed Marcon was being hostile towards him and said: “I’ll put a 200% tariff on his wines and champagnes,” and maybe then the French president would join the board. Trump’s latest threat triggered a selloff of shares of key publicly listed French wine makers. Shares of LVMH—which owns brands like Moët & Chandon and Dom Pérignon—fell nearly 2.9% to €566 ($663), while Remy Cointreau’s shares dropped 2.4% to €38 ($44.50).
How Has Europe Responded To Trump’s Tariff Threats?
European leaders including Macron and British Prime Minister Keir Starmer have criticized the tariffs. Macron has pushed the European Union to respond with a so-called trade bazooka using its most powerful retaliatory tool, the anti-coercion instrument. If implemented, the EU could use this to target major U.S. service exports, which could hit U.S. tech giants particularly hard. However, the New York Times has reported that some within the bloc are still pushing for a negotiation rather than retaliation. An EU spokesperson told reporters: “Our priority is to engage, not escalate…Sometimes the most responsible form of leadership is restraint.”
Tangent
On Tuesday, U.S. Treasury Secretary Scott Bessent mocked the EU’s ability to mount a coordinated response against Trump’s latest tariff threat. Bessent, who is in Davos to attend the World Economic Forum, told reporters: “I imagine they will form the dreaded European working group first, which seems to be their most forceful weapon.” The treasury secretary later said, “I am confident that the (European) leaders will not escalate and that this will work out in a manner that ends up in a very good place for all.”
Further Reading
Trump Shares Private Texts Sent By Macron And NATO Secretary General On Greenland (Forbes)
Trump Announces 10% Tariffs On European Countries Supporting Greenland (Forbes)
