Greenland or Trade War: Trump Threatens Europe with 10% Tariffs as Alliances Fray

He's asking for Greenland but offering tariffs. U.S. President Donald Trump just sent a shockwave through global markets by threatening to slap a 10% extra tariff on imports from eight European countries. The move, a direct response to their opposition to his desire to take control of Greenland, has forced a rare and forceful rebuke from America's closest allies.

Trump Greenland Tariffs 2026: A Transatlantic Crisis

The targeted nations—including Germany, France, and the UK—warned that the threats "undermine transatlantic relations and risk a dangerous downward spiral." This joint statement marks the most significant diplomatic rift since Trump's return to the White House nearly a year ago. According to SPI Asset Management, the strategic alignment that keeps capital flowing into U.S. assets is no longer a given.

Markets reacted swiftly on Monday, Jan. 19, 2026. Futures for the S&P 500 skidded 0.8%, while the Dow Jones Industrial Average futures fell 0.7%. In Asia, Tokyo's Nikkei 225 dropped 0.8% to 53,523.92, while South Korea's Kospi defied the trend, jumping 1.4% on tech strength.

Earnings and Inflation: The Road Ahead

Investors are now bracing for a heavy week of earnings from Intel, 3M, and United Airlines. The Federal Reserve is also awaiting the PCE price index—its preferred inflation gauge—before its policy meeting in two weeks. With inflation stubbornly above the 2% goal, the central bank's balancing act between a slowing labor market and rising prices has become even more precarious.